Have Car Companies "Innovated" Themselves Out of Business

over the last two decades very few major markets have seen changes quite as widespread and expensive as the car industry a push towards electrification new major competitors from China and South Korea self-driving technology tighter regulations and hundreds of billions of dollars in investor money has made it extremely difficult for companies to adapt to every single last change while also delivering a product that's not sh dozens of companies are betting their entire future on the next 5 years but that's happening as a lot of people are still underwater on their last car so they're not in

a rush to buy their next technology is changing so quickly that cutting edged cars today might be completely redundant in a few years time meaning the right thing to do for most drivers is to sit back and wait the investors on the other hand are realizing that if you invest billions of dollars to disrupt a market you shouldn't be surprised when the market gets disrupted congratulations CEO Elon Musk unveiling the taxi of the Noto distant future the Cyber cab at an exclusive event tonight it's now moving towards electric vehicle so Jaguar came up with a

bright plan a complete Rebrand except for cars this time they're selling Vibes everyone knows the minute you drive a new car off the lot its value depreciates but for electric vehicles the drop is dramatic calling a million hybrid vehicles because they may catch fire the Prius Prius plug-in hybrid and the CHR uh SUV model are all needing electrical system repairs a few months ago the British car company Jaguar announced announced that it would cease producing cars until it could totally rethink its entire product lineup the prestigious automaker was once a British alternative to German luxury

Brands like Mercedes Audi and BMW even though the company was technically Indian in recent years though the company has released cars that were plagued with reliability issues lapses in quality and were generally much worse value for money than even the premium Brands they were trying to compete with the company's ipace compact SUV was supposed to be their Mass Market product of the future but it had worse range in Tech than most other small electric SUVs all at a significantly higher price point the only thing really selling the cars was their premium brand image but that

can only last so long last year in an interview the company's own Chief creative officer admitted that the company had no brand Equity left whatsoever the only thing keeping the company alive was it shared ownership with Land Rover but eventually it was just taking up space on dealership lots that could be filled with cars that actually sell in response to sales numbers that were circling the drain the company has stopped selling cars with the plan to entirely relaunch the brand the first phase of this plan was launched last week with a brand new logo and

marketing video that Drew mixed reviews advertising a new and improved car company without actually showing any cars is a bold strategy now a British car company making horribly unreliable cars and then going bankrupt is not worth making a video about that's just what they do but this is just a sign of a much wider issue that is affecting the whole industry and that is simply nobody knows what the [ __ ] is going on back in the good old days of 2021 Ford and Volvo were amongst the first traditional car companies that made a pledge

to transition their entire fleet to electric vehicles in certain Global markets at the time demand for EVS was outpacing crippled Supply chains and credits made them quite affordable last month the companies had quietly walked back their Ambitions because the market for electric vehicles changed in three big ways the first was that electric vehicles specifically have been the target of major sanctions across the world primarily targeting cheap cars coming out of China despite all of its Swedish branding Volvo is actually owned by Gilli a Chinese conglomerate holding company and a lot of its EVS are made

in China because the battery supply chain is far more mature there this means that their fully electric Fleet would be uncompetitive in markets like the USA unless they move production there exclusively which would be hard for a lot of their vehicles the second reason is at the same time tariffs are going up subsidies for EES are coming down the price premium of an electric car in many places was offset largely by tax credits that would cover a significant share of the purchase price these have become less popular as people are seeing them as their tax

dollars going to subsidize some tech Bros model 3 and the third simplest reason is that people just don't want to buy EVS early adopters are a relatively small Market especially for such a valuable purchase even those customers who are happy to put up with a little bit of inconvenience or a higher price point to do their part for the envirment or just to Signal how forward thinking they are are not going back to EVS a survey conducted earlier this year by the Mackenzie Center for future Mobility found that 46% of current EV owners would shift

back to an internal combustion engine car for their next purchase setting issues with charging infrastructure as their primary concern now people rolling coal in their lifted F350s are probably never going to switch to an electric vehicle unless there is literally no other option apart from something completely Unthinkable like public transport but even the group that was already one over and made the big purchase are switching back making car companies across the industry Rec consider going all in on ev even Tesla the Undisputed king of EV sales in America is starting to hit a plateau in

new deliveries the first quarter of this year marked the first time since the launch of the model S that they delivered less cars in the same quarter the year before other new EV companies like rivan and Lucid motors which were hopeful competitors with Tesla are still losing tens of thousands or even hundreds of thousands of dollars on every car they sell because they have had to offer extremely competitive cars to Market to tempt buyers to take a chance on a relatively unknown company the cars they are making are some of the best engineered machines on

the road but they are now only being kept Alive by multi-billion Dollar financing rounds from foreign governments or incumbent automakers who are probably more interested in their technology than their actual cars to keep up every other car maker has to also compete with a company that is losing money on every car they sell which is putting even very wellestablished automakers in a tight spot to tempt new buyers car companies have to spend billions to keep on offering something new that makes their old model seem relevant by comparison but just as many people are put off

because next year there will be something even better so there is no harm in Waiting especially when things can go so badly wrong Fisker was another new e competitor that offered alternatives to the Tesla lineup which has already gone out of business their cars were cost competitive but they are now effectively worthless because their after sale service no longer exists and highly technical proprietary EVS can't be worked on by independent third party mechanics move fast and break things might work for technology work cost overheads to the end user are zero but the average new car

costs almost $50,000 at the same time that most people are struggling to keep up with the cost of living what people really want is a car that will move at all and won't break the bank so it's time to learn how Mone Works to find out why car companies are struggling to provide that this week's lesson was sponsored by ODU the all-in-one solution for businesses that brings together a full Suite of integrated apps to streamline every aspect of your company's operations every aspect from sales CRM accounting and much more ODU simplifies complex business processes by

integrating them into one userfriendly platform ODU gives you the power to manage your sales Pipeline with a few clicks automate lead scoring and even predict the next best action to take with your leads and customers with ODU they make streamlining everything in your company a priority the platform's MRP capabilities allow for seamless production planning scheduling and real-time inventory tracking ensuring your business runs smoothly ODU was built for customization and needs of use whether you're in need of a CRM Sales Inventory project management or even creating your own app with ODU Studio the platform molds to

your business requirements select only the apps you need making it as lean or comprehensive as you wish and the best part you can experience the Simplicity and power of ODU firsthand without any commitment getting started is risk-free with a 14-day free trial no credit card required and you could use any single app for free forever click the link in the description or request a demo today to see how ODU can transform the way you do business now it's not just EVS that are struggling to adapt to changing market dynamics as the newest product offering in

the market they are being upgraded the fastest especially since a lot of automakers have skilled back research and development into internal combustion engines but old-fashioned cars have created their own problems too cars are simultaneously lasting longer and shorter at the same time a study by the autom market data firm capap hbi in the mid-20s found that the life cycle of new cars is now significantly shorter than it was in past decades with the average new model only taking 2 years before an upgraded model comes along a lot of models receive a refresh every single year

where manufacturers will make small changes to styling infotainment and make small drivetrain tweaks to differentiate between model years more frequent regulation changes around emissions and safety has made these equally more frequent updates necessary but obviously I don't need to tell you that if Brands can make last year's model look obsolete with some styling changes they will do it it the number of different car models available in the market has also increased by over 50% in the last 20 years fueled by both the introduction of new EV models but also car brands trying to cover more

of the market 20 years ago a Bentley Aston Martin or Ferrari SUV would have been a laughable idea but now it's their bestselling car this is happening across the industry as automakers try to cash in on their brand value to produce more mass Market cars if you consider a half million doll V12 Ferrari commuter car Mass Market even at a regular price point manufacturers are making a range of vehicle sizes especially for SUVs where it's not unusual for a single brand to have four or five different model offerings from compact to fullsize SUVs with several

different trim and drivetrain options for each including full internal combustion hybrids and AVS within the same model the end result is that across all price points car manufacturers are making more cars which are being updated more often while having to adhere to more regulations across more markets with more competition from more startup with more funding than they really should have brands are having to allocate a lot of money to R&D to stay relevant and if they can't keep up even big Global Brands like Nissan have quickly lost market share now not every car company has

the luxury of selling their cars at a loss so this growing business expense is being passed along to customers the Inconvenient Truth About new technology is that sometimes it's kind of crap Toyota has become the world's bestselling card brand largely thanks to their legendary reputation for reliability generally Toyota develops cars very slowly which means that models have long production runs and even if something is a bit outdated they will keep it around as long as it's reliable the combination of reliability and the Very fact that their cars don't normally look that different year-to-year has also

helped them maintain very strong secondhand prices which doesn't directly help the company but it does mean that it has a DieHard customer base that won't drive anything else but even legendary Toyota has not been immune from this disruption sweeping the car market they have had to move with the times and phase out a lot of their big lazy inefficient but extremely reliable engines and replace them with smaller more highly strong Alternatives this change has caused several extremely high-profile engine failures which have tarnished the Brand's Invincible reputation now by the Numbers Toyota's reliability is still class

leading but a viral video of someone's new $30,000 Corolla burning down on the side of the highway sticks with the average consumer more than the numbers do now apart from the people that are happy to lease the newest car every 2 years this Market is not great for anybody most car buyers just want a simple reliable car to get them around most companies want to provide it to them even the investors are playing a billion- dollar game of Last Man Standing and it's all because some Industries just don't need to be disrupted now some former

employees here at how money Works have abandoned me to start their own channel and they have actually made a video that shows the result of this disruption in every industry I am sad to see them go but their new videos are really good so I want to see them do well definitely check it out and make sure to like And subscribe to keep on learning how money works