It is no secret that the gas combustion engine is facing its twilight time. The new kid on the block, the electric powered vehicle is approaching dawn. At present, it comes in two forms: all-electric and plug-in hybrid. The ratio of sales between the two is 60% for electric and 40% for the hybrid. In numbers, the electric combo sold 720,000 worldwide and the reliable gas cars sold 17 million. The gas powered car is still king of the road, but there is revolution in the kingdom. Nevertheless, experts say that by 2040, it will be an even split.
California is pushing the timeline. They have set 2035 as the last year for new gas-powered sales in their state. Coincidentally, GM has stated that it will end production of gas-powered vehicles in the same year. Ford says it will be all-electric in Europe by 2030.
With that type of dramatic change, all car manufacturers are preparing. The average price for a new electric style car is over $32,000. In this category, of the three cheapest vehicles in this segment of the market, Ford and Volkswagen hold two spots: Volkswagen with their e-Golf and Ford with their C-Max. They want to expand their presence, but their planning took a hit last week. The problem centers on the fuel, so to speak. Electric need batteries. The best performing batteries are lithium. The engineering problem is to make the batteries safer, increase the range capability and reduce the weight for better mileage, versatility and comfort.
Tesla is the market leader. Tesla is now also a miner. They have turned their attention to the battery. Tesla recently purchased 10,000 acres containing lithium in Nevada to develop their own lithium process and to ensure supply. This is central to any development into the electric segment of the market. A court decision last week has many ramifications associated with it.
Intellectual theft...LG Chem v. SK Innovation
is a growing problem. Asian nations have a cultural problem. They do not honor patents. Apparently, SK hired 70 employees from LG. They took with them trade secrets in battery knowledge. This type of theft happens every day in Silicon Valley. One firm poaches another for talent and product knowledge to leap-frog the competition. Whatever happened to the old technique of bribery? Only kidding! This is a serious problem in global commerce. China leads the most wanted list. China would be great in the WWE, where lying, cheating and no rules can lead to success. In life, this is despicable. Someone spends years to develop a system or a product, only to have it copied overnight and sold for less under state sponsored subsidies. This is another reason why I would end all trade with China. Anyway, the ruling by the U.S. International Trade Commission went against SK. This is a serious blow to Volkswagen who has a contract with SK to make a special battery for their ID.4. It is does damage to Ford who also has a deal to make a special battery for their F-150.
Biden's Green Policy Plan
will be tested by this verdict. Like I stated, this case has many ramifications. Under the surface today, there is another problem. A court's verdict is no longer law of the land. The problem is lawyers. It is not whether something is right or wrong, but who wins. SK will ask Biden to veto the ruling under executive order. The court's decision has put a ban on SK for ten years. SK says that they will build this special battery plant in Georgia. If Biden does not veto the decision, American workers will lose this new source of high paying jobs. On the flip-side, LG has a battery plant in Michigan for GM. Biden's decision is basically picking who wins and who loses. Fortunately, this conflict was between two S. Korean firms. Imagine if one of them was Chinese? China will be watching this case. If I was Biden, I would rule against SK. Do not reward cheaters! You send a signal to China to start behaving in an honorable fashion. By the way, the judge on this court showed real understanding of life. He gave Volkswagen and Ford a transition time to make a new deal or find another supplier. In any event, Volkswagen and Ford took a hit to their future plans for electric vehicles. Peace.
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