Automotive News - September 23, 2024 - 12

12 * September 23, 2024
opinion
I
EV registration
data shows risks
of playing politics
T
esla Inc. faces increasing competition in the electric
vehicle market it once had nearly to itself as its
models age and rivals ramp up their offerings.
But, as our Laurence Iliff reported, registration data
from Silicon Valley shows another dynamic at play.
Call it the X factor.
Tesla CEO Elon Musk's political shift to the right on the
social network he owns, X (formerly Twitter), could be
dragging the brand down in largely liberal Silicon Valley.
In Santa Clara County, Calif., the heart of Silicon Valley,
new Tesla registrations fell 22 percent from January through
July from the same period a year earlier, while EV rivals saw
41 percent growth, S&P Global Mobility found. In the broader
five-county tech corridor, Tesla registrations fell 21 percent
while registrations for non-Tesla EVs grew 1.4 percent.
As one consultant put it: " More and more people have just
had it with him. "
Musk has always been outspoken and certainly has the
right to take any political position he pleases. His stances on
regulation and encouragement of entrepreneurship and
innovation are hardly controversial in the business world.
He also has a clear interest in encouraging discourse on X,
which he spent $44 billion to purchase.
But as the election draws closer, Musk's posts have ranged
from standard candidate support to amplifying conspiracies
to downright inappropriate, especially his musing about the
lack of assassination attempts against the current president
or vice president.
Let this be a cautionary tale. Automaker executives have a
role to play to promote sales and increase shareholder value,
and Musk's public image isn't helping anymore. Tesla's
favorability is falling among both Democrats and Republicans,
according to a survey by CivicScience. EV buyers are looking to
other brands, such as Rivian and Hyundai, because of their
new EVs and because they aren't connected with Musk.
If another automotive CEO created social media posts with
that kind of content it would be a big story, but Musk has
evaded consequence for pushing social norms before.
Most auto executives maintain strict boundaries in public
settings, and the box is there for a good reason.
Tesla's declining EV registrations in Silicon Valley, where
the EV maker was founded, shows that pushing the norm too
far - to an inappropriate, conspiratorial or overly political
level - could hurt business.
Cleanup has a plan to pluck all of
that plastic out of the ocean. The
group says it's proved the concept
and now it needs billions of
dollars to do it.
Most of the money is going to
have to be donated, but at least a
little can come from the sale of
items made with the recycled
ocean waste.
That's where Kia comes in with
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COMMENT
Cleaning the ocean has a price
- and layers of complications
n the next month or so, Kia will begin
offering an accessory for its EV3
subcompact electric crossover that will
be made of recycled plastic scooped
out of the Great Pacific Garbage Patch.
That's the spread of the Pacific Ocean -
west of California, north of Hawaii, about
twice the size of Texas - that's estimated to
have more than 200 million pounds of
plastic waste sloshing about in it.
A nonprofit called Ocean
funnel, if you will, about the length of the
Golden Gate Bridge - 1.4 miles - that
gathers the plastic bits in a giant net and
can haul in about 180,000 pounds at a time.
It sweeps an area the size of a football field
every five seconds, Slat said.
At an event Sept. 6 in San Francisco, he
said building out the now-proven concept
could clean up the garbage patch's 200
million pounds of plastic in 10
years at a cost of about $7.5
billion. But he projects that with
more advanced GPS trackers and
AI-equipped drones, Ocean
Cleanup could do the job in five
years for about $4 billion.
That's not a small sum, but it
could be well within the reach of
JAMIE
BUTTERS
EXECUTIVE
EDITOR
its own proof of concept.
" This is how we started our process, as a
test on how can we basically ramp up the
industrialization of that recycled plastic
from the Ocean Cleanup, " said Kaoru
Kumasegawa, Kia's vice president for global
brand strategy.
We thought there would be recycled
Pacific garbage in the EV9, but at this point
the three-row crossover uses recycled dryland
plastic and bioplastics, he said.
The challenges are immense -
potentially overwhelming - but making a
start gives a chance to improve and really
make a difference.
Ocean Cleanup
Having been on one of the Ocean
Cleanup boats, I can attest that the garbage
really stinks. And the crew says it's a lot
worse when the trash is freshly dumped
onto the deck for sorting.
It's gross work, for sure, but it sure beats
leaving all of that junk in the water.
" The longer that plastic remains in the
ocean, the more that stuff fragments down
to smaller and smaller microplastics, which
are first of all pretty much impossible to
ever get out, but also are much easier to
end up in the food chain, " said Ocean
Cleanup founder Boyan Slat.
It doesn't come without a cost.
Slat said that after years of trial and error
and iteration, they've struck on a workable
solution.
Two Maersk Supply Service vessels -
Tender and Trader - pull a giant flexible
governments, corporations or
individuals. Slat rattles off the
comparisons: It's the same amount
as the gourmet pet food industry.
It's less than half of what
Americans will spend this year on
Halloween decorations. It's a quarter of 1
percent of the net worth of the 10 richest
humans. It's less than 1 percent of the net
profit of the world's plastic producers over
the length of the project.
All true, but it isn't nothing. It's like two
assembly plants or 500 dealerships.
Julian Searle is Ocean Cleanup's business
development chief, which involves a lot more
than fundraising - but there isn't much
else that can be developed without funds.
He's focusing his efforts on corporations,
in part because it's the area he knows best.
But strategically, he knows that they can be
more nimble than governments and they
have big budgets - some of which can be
steered toward efforts that pay off in terms
of public relations, marketing or ESG -
environmental, social and governance -
goals.
" I don't think one person or one
company is going to write the full check.
That might make life a little too easy, " he
said wryly. " So it's really about: Is it 10 large
corporations, is it 20, you know, slightly
smaller sort of coalition members? Those
are the kind of discussions we're having. "
His aim is to have enough intent
expressed by the end of the year that the
scaling up can get started.
While that's a lot of money for a nonprofit
to raise, it seems like it should be doable:
The money exists and the cause is noble.
Yes, there are critics, who say more efforts
should be focused upstream: Taxing the
LETTERS
Hold technicians
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responsible for work
TO THE EDITOR:
Technicians, or the talent, are running
fixed operations. Let's take back control
with practices we are already using. Techs
want to run the show. They want more
money and guarantees than ever. Let's get
past that; just pay them, but we need to
hold them responsible.
Make them value their pay instead of
taking it for granted. If they're a high-paid,
high-level tech, then they need to deliver.
Keep up their training.
Keep production levels high.
Keep punctual attendance.
Ensure the right diagnosis is made and
right parts are ordered.
Test drive the vehicle before and after.
These easy steps will keep techs more
engaged with less time to complain.
Change the mindset of responsibilities.
Demand these already required practices.
One way to help production is to simply
have parts in stock instead of too many
special orders. Use a " lost sale " process.
Production of techs is improved.
Customers are much happier.
Fewer mistakes are made in getting the
wrong parts.
Rental expenses are reduced.
This will help all parties involved.
Lastly, most of the manufacturers have
their own chemicals available. Get rid of
the aftermarket flushes. Make your staff
your salespeople and not a spiff chaser. Put
the factory chemicals on your own menus.
MICHAEL ONTMAN
Porter Ranch, Calif.
snot out of so-called virgin plastics to
encourage more use of planet-friendly
alternatives; focusing on keeping plastics
from reaching the ocean (which is Ocean
Cleanup's other main effort - intercepting
the trash at the mouths of rivers); cleaning
beaches of plastic waste that washes
ashore.
To eliminate plastic waste in the ocean,
all of those things need to happen.
Downstream challenges
I worry about the downstream
challenges. If Ocean Cleanup starts pulling
40 million pounds of plastic into American
harbors every year, where is it going to go?
A lot of the plastic that gets salvaged is
from fishing nets, which are particularly
challenging to recycle. It typically has to be
taken to Europe for processing, said Rose
Beaumont, chief marketing and
communications officer.
The economics are truly daunting. Searle
said virgin plastic can be as much as $1 per
kilogram, while recycled plastic is typically
$2 to $4 per kilogram. " And our costs are
even higher, " he said. Beaumont likened
the end product to diamonds.
The hard plastics from the Pacific are salty
and stinky and harder to recycle than the
stuff collected at curbside. And the ropes
and nets from fishing boats are harder still
to reuse.
I've been told that plastics don't recycle
indefinitely, like aluminum might. Ocean
Cleanup is focused, Searle said, on making
sure that the new products aren't going to
end up back in the ocean or in a landfill.
Finding value at the end of the line is an
interesting challenge that Kia is about to
embark on. " This was made from
disgusting human waste " is a tough
marketing pitch. I'm sure it will sound
more like " this was made from an effort to
rid the ocean of plastic waste. "
It's not clear how many things people
are going to be willing to pay extra for - or
how much extra - because it was sourced
as part of a heartwarming cause. The
coffee market, for instance, shows that
there are at least some consumers willing
to pay for more ethical sourcing -
especially for something that is so
ingrained in everyday life.
Fingers crossed that the EV3 accessory
will be as appealing as diamonds.
You may email Jamie Butters
at jbutters@crain.com.

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Automotive News - September 23, 2024

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