Toyota just entered a partnership with Panasonic where it will make 50x the battery production it currently does or enough for 5.5 million Toyota BEVs by 2030- and to be clear its full BEVs we're talking about because you don't 50x Toyota's current battery usage at 5.5 million miles and get anything but long rage full BEVs from it. Remember that the head of Toyota personally took over Toyota BEV development a few years ago. Now this contradicts a recent BS announcement by Toyota that projected only 6% BEVs by 2030 but contract (actions) speak louder than words especially the ones publicly contract terms for in terms of the number of vehicles... as opposed to vague announcements by VW. Now what do you think might have changed. We could see Toyota's logic in that Toyota was slowly moving toward a model of hybrid where the ICE part of their hybrids was a component that could just be swapped out for more battery kind of like replacing a diesel generator on a locomotive for a battery. And we knew of Toyota's objective about not wanting to go commodity and some of hits hard won points of differentiation. So what changed (some clue below)? But what changed with the announcement of that number in its true context is enough for us to understand that Toyota has clearly abandoned FCEV and everything else aside from BEVs- and this is now clear no matter what else they say. And for context remember that they already had a partnership with Panasonic for battery production in place. The number 5.5 million in 2030 contains all the magic. Why 2030? That is the end of a convergence point for a bunch of trends both technological and legal. 2030 is obvious so we won't go into that except to say that 2025 contains everything that is meaningful about 2030 and seven year battle for survival and dominance begins right now and it is truly existential and a lot of that (below) has a lot to do with China's state of preparedness right now. What makes contracting for enough battery capacity for 5.5 million BEVs per year by Toyota a tell all may not be obvious to those who haven't been paying attention- they may thing it would represent the very low end of 50% BEVs by 2030 but would be an absolutely wrong assumption, it actually represents far in excess of what total vehicle production is likely to be for Toyota even it takes massive market share. Right now Toyota globally manufactures just over 10 million vehicles per year and I think that is down a bit. You might think that in 10 years they could double their production of vehicles or at least bring it up by 50% and in 20 years double it right? But they know that what Tony Seba has said is true and due to electric autonomy buyers by 2030 will be fleets or Toyota will be selling to themselves and the market for new vehicles will have contracted 10x-18x. Even if you think they could double their new car sales to 20 million 11 years from now (after all, all things being level that might just be keeping pace with inflation) you still have to factor in the coming radical reduction in the need for vehicles even against developing world growth. That reduction would leave Toyota with 2 million cars to sell per year if they were lucky and even that might be possibly taking share from competitors. Maybe that means the capacity would cover vehicles with 500 miles of range solid state quick charge and still hold share at 1 million vehicles a year? Because after all Seba is projecting these kinds of reductions before 2030. What Seba is talking about is a 10x reduction from today's numbers of required new vehicles per year by at least 2030 so presumably developing world growth is already taken into account. Right now demand is about 100 million new vehicles a year globally, whereas then Toyota's present share would account for the whole world's new production in 2030 or possibly before or well before. Maybe not, maybe the developing world surprises but even so 5.5 billion BEV's presumes Toyota takes huge share and may be able to earn more revenue per vehicle (would have to or take a hue hit)- one of the things suggesting Tesla will never have to sell something cheaper than the base Model 3. But note Tony also says the average American will spend 1/10x on transport per year. So imagine this is the most disruptive period business has ever faced. We will need a permanent high indexed GAI just to keep the peace and not descend into civil war- Musk is right on that front too. Now as we know fossil fuel shill Ford just announced the unthinkable in saying it would make an all electric F-150. The Ford chief did not put down electrics but made a fully positive announcement- which may be the best evidence yet that Ford might survive. This might have provided cover for Toyota to come forward. In order to make this claim credibly Ford as a weak company has had to enter partnerships with 2 other weak companies, those being VW and Apple and as Pull has speculated Ford had to give up F150 IP and preassembly IP to get that venture- Ford put sufficient skin (its crown jewels) into play to show it was serious. But these (Ford and ilk) are weak companies not just on the merits of their products or prospective products or business or market context but weak in the competitive sense. they are second stringers because on the other side is Toyota-Panasonic-Amazon... and Tesla, Also Google-Honda- GM will be in that fold- its a 3rd stringer. There is a little more revenue on the Ford alliance side than say the Toyota side but no inspiration or quality on that side- Apple has just been cruising on what was laid down while Jobs was alive, it has nothing going forward but it does have a pure parasite capital model. Honda seems to be part of whatever Google has going on. I presume Nissan is lost or merges with FCA which I think gets tossed into the Google cart with Honda along with Hyundai Kia. Worth noting the Google team in order of value Honda, Hyundai/Kia, Nissan Renault, GM, FCA- Jaguar- Volvo probably get tossed in here too. I see rivals Mercedes and Daimler having to merge or do a hard partnership to have a chance at surviving but they don't for a Fifth element- their best fit would be in the Toyota group. So there is the VW team, the Google Team and the Toyota Team but all of them will seriously struggle with the tidal wave China is about to unleash so its quaternary and not stable cartel oligopoly that's coming. None are better tied to China than Tesla it seems, Tesla's Asian base seems solid and that is what is needed. If Rivian is high enough quality it will probably get added to the Toyota Team. I wonder if Boeing and Airbus get added to an extent to the VW team- it is the weakest of them. But I don't think the 3 new conglomerated groups together match what China is unleashing right now. Amazing how effective Elon has been. Someone needs to make a montage of all the naysayer claims juxtaposed against the present reality of Tesla. For every stupid short pronouncement have a clip of a Model 3 beating a Camaro SS or Ford Mustang at the track. Now it seems Toyota has just fully weighed in. When Musk would say he was amazed at China's progress and China rolled out the red carpet I think we see where the vision is. That foolish GM exec that said there would be no GM BEV trucks even 20 from now will surely be fired soon- just like saying there wouldn't be an electric Porsche 911. Now we have to put all of this into the perspective on China, because we just learned that China has the BEV productive capacity it needs for 2030 right now, really for what the entire world may need in to replace total new vehicles in 2030 with BEVs right now. Right now China has 500 new BEV makers- that is competition. And at the start of this year has enough BEV capacity for 20 million new cars per year or enough to replace 90% of its domestic market right now. I've wondered about the battery capacity for that but that is what the reporting is saying. So right now in 2019 China has the productive capacity to replace the entire world's new car need in 2030 possibly by 2x. But keep in mind that a lot of these companies may also seek to become fully green energy suppliers so we could see Toyota supplying solar cells and batteries along side AEV subscriptions directly and that may be part of the difference that would accommodate the even greater BEV capacity coming on line. Also I think it is clear that the Trump administration is over, the world has had enough of Bush and Trump seeing into Russia's soul and the fossil fuel centered results, the Trump admin is not going to be able to do more damage to the green global economy it has been seen and rejected for what it is- the American admin and society will be too tied up in getting rid of its money centered conflicts of interest to interfere further or get distracted by mid east fossil fuels- when fossil fuels act up now they just get summarily replaced at an even greater clip.
