Why Automakers' EV Factory Investments Aren't Paying Off In The U.S.

Automakers aren’t selling as many cars as they used to, and the EV transition is a lot rockier and slower than some expected. This means there’s a lot of factory space in North America and around the world that is sitting empty and unused. Some companies especially challenged are Ford, GM, and Stellantis, Nissan, and EV makers such as Tesla and Rivian. That could mean billion dollar losses, job cuts, and chaos in the supply chain. Auto makers, industry analysts and even governments are adjusting expectations and trying to prepare for an uncertain future.

Chapters:
00:59 - Why automakers are losing billions on their factories
1:06 - Chapter 1: Factory utilization
04:25 - Chapter 2: EV transition
08:58 - Chapter 3: New normal

Producer: Robert Ferris
Editor: Andrea Miller
Animation: Jason Reginato
Senior Managing Producer: Tala Hadavi
Additional footage: Getty Images, Reuters

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Why Automakers' EV Factory Investments Aren't Paying Off In The U.S.

[thebaps-wu]

They conveniently left out the part where automakers were trying to sell their EV's for 20k over their gas-powered equivalents. Yes, I can save money on gas. No, it doesn't bridge a 20k gap in price.

[ladhkay]

What shoddy reporting. The carmakers have no one to blame except themselves. 60 grand for a mid suv really?? Always charging +10-20K over sticker, they def deserve to go under

[philburch]

Stellantis raised the prices of it's vehicles by 60% from 2019 to 2024... that's not inflation, that's total corporate greed. And the customers basically gave them the finger.

[rangledangle]

Well the dealers got greedy and jacked up the prices, so no one thinks those cars are worth it anymore. Go direct to consumer and make everyone happy.

[daniele]

I wonder why their $100, 000 Silverado EV isn't outselling their $40, 000 gas Silverado?

[novadea]

In a sane world the manufacturers and retailers would drop prices of the overproduced cars to clear up their lots but I'm pretty sure in the dystopian timeline we live in they'll instead decide to just scrap them/let them rot, because it totally makes sense to not receive any money for the thing you produced instead of the money you thought people would be willing to pay for it 🙄.

[tjhouston]

Why are we trying to skate by the issue… THEY ARE

[Arlington]

They were bragging a few years ago about how they had great profit margins by selling less but way much more expensive units...

[mprooveit]

We can't even afford the same internal combustion vehicles we could afford in 2019/2020... An F-150 selling for $42K in 2020 is now $62K. Did anyone's income go up proportionately to that?

Nevermind EVs... never asked for one and it isn't practical. If other states manage the electrical grid like CA, EV simply isn't a reasonable choice.

[rorytribbet]

Make the cars cheaper lol that’s how you sell more. People LOVE buying new things, but right now across the west but certainly in the US, salaries don’t even come close to approaching what they need to be for people to pay the kinds of prices companies are asking.

[mishulicius]

EVs aren't selling because they are ridiculously overpriced. And automakers used these tactics from the beginning, until it backfired on them.

[sutats]

Just like mobile phones, people don't change theirs as much in recent years since most of them are equipped with functions and features beyond what most would need.

[msj]

It's the high ass PRICES!!! I bet if we let those Chinese EV cars in with no tariffs they would sell like hotcakes.

[_Diggler]

Wages don’t match the prices they want to charge. Didn’t the bean counters consider that? People can afford a $35k car. So let’s only make/sell $60k cars! We smart!!

[Ktrain]

The EV market was created artificially by the government through subsidies and requiring the auto makers by law to manufacture them.
The market was not naturally created by consumer demand.
Manufacturers changed their factory production methods and over produced a product that only a small segment of consumers were asking for.
I like this piece and it was a good breakdown. But it surprises me that outlets don't report on this part of the story.

[mistervo]

High inflated pricing to maximize profit, but it backfired because consumers won't buy it

[kplumber]

Automakers are in trouble due to the high prices cars are selling for. Now cars are almost as expensive as buying a house. There’s your low demands.

[F-ci]

They priced the middle/lower middle class out. Keep adding options we don’t want or need. Good decade to run a mechanic shop.

[kylekraemer]

Another thing not mentioned is that people are tired of spending big money for unreliable vehicles that depreciate like a rock. Does anyone trust GM, Ford, Stellantis or Nissan? Notice how Toyota and Honda don't have the same problem moving cars.

[johnarnold]

Not much said about Tesla. They profit about 8 grand per vehicle sold while Ford loses about 100 grand per vehicle.