Fun fact: There were (about) 1.4 billion vehicles on the planet in 2022, according to various estimates. 

As you might expect, the U.S. has one of the highest concentrations, at around 82 to every 100 people. But there are other car-loving countries, like Finland, which according to the World Economic Forum at one point had 1.07 cars per person. 

Not so in Singapore. The city-state, which you can drive across in under an hour and has a wide-ranging public transport system, has just 12 cars per 100 people, data gathered by Reuters shows. 

A model country for decarbonising transport, you might say – but there’s one problem. According to the Singaporeans, if you’re going to have a car, it better be a supercar – and those usually aren’t electric, at least for now. 

More on this in today’s AutoFile – the last from Victoria Waldersee and Nick Carey before Joe White returns next week with fresh quips about baseball and the hapless Detroit Tigers – alongside Ford’s loss-ridden road to EV profitability and the possible end of days for Evergrande’s electric ambitions: 

Singaporean chip designer Eu Gene Goh is an electric-vehicle evangelist with two Teslas in the garage… but he still loves his McLaren 765LT. REUTERS/Caroline Chia

Singapore is the most expensive place on the planet to buy a car. That’s because the 5.6-million person city-state has a unique system to limit cars on the road: to drive your vehicle, you need to obtain one of a limited number of 10-year certificates bought through a bidding process which can cost tens of thousands of dollars. 

The system, though effective at keeping the number of cars on the road low, prices lower-income people out of car ownership and means that Singapore now has more Porsches on the road than Teslas. Over the past decade, the number of Ferraris in Singapore has grown by 67% and Lamborghinis by 38%, the data shows. 

Alongside a few other ambitious countries like Iceland, Netherlands and Sweden, Singapore wants to phase out combustion engine cars altogether by 2030 – but sports cars aren’t so easy to electrify, and although EV sales constituted 12% of total sales last year, a Reuters analysis showed EVs represent just 1% of cars on the road, with ultra-wealthy car-tech enthusiasts buying their Tesla but ultimately keeping it in the garage and taking the Ferrari out instead.

Workers plug in an electric Ford Mustang Mach-e electric vehicle during a press event at the Ford Halewood transmissions plant in Liverpool, Britain, December 1, 2022. REUTERS/Phil Noble

Ford expects its electric vehicle business to lose $3 billion this year, with cumulative losses in 2021-2023 of up to $6 billion by the end of the year – but all is on track for a pre-tax margin of 8% by late 2026, the company said. 

Investors seem to believe them, with shares up 1.9% on Thursday despite the big red numbers. The company said last March it would run its EV unit separately from its legacy combustion engine business, allowing investors to separately value the two businesses  

It’s well-known that building up an EV business is, Reuters Breakingviews columnist Jonathan Guilford notes, a “big cash incinerator”. While some say EV-only makers have an edge by focusing exclusively on new technologies, legacy automakers can use the profits from their combustion engine business to subsidize the build-up of EVs – unlike start-ups which rely on external funding. 

Still, it’s a steep hill to climb, Guilford writes, with rising costs and pressure from competitors making breaking into the new market all the more challenging. But scale helps. 

A Ford announcement at the end of the week further emphasizes the expense involved in going electric. The carmaker said it plans to build up to 500,000 electric trucks a year at its BlueOval City complex under construction in western Tennessee.   

The complex is being jointly developed with Korean partner SK On at a cost of $5.6 billion. 

China’s embattled Evergrande’s New Energy Vehicle Group may have to halt production of EVs if it cannot obtain more funding.  

If, at some point in the future, it receives over 29 billion yuan – about $4.2 billion – it could launch a number of new models and hit mass production, the company said.  

But for now, it’s struggling under the weight of its parent company, the most indebted property developer in the world, which is in the middle of restructuring $22.7 billion in offshore debt.  

The hope is for that process to facilitate an orderly resumption of business operations – but the EV business may need to be shut down in the meantime.  

This continues the woes Evergrande’s EV unit, which had previously planned mass production of its second EV model in the first half of 2023 and said it aimed to make 1 million vehicles a year by 2025. The Chinese group was forced to sell off some parts of its EV business in 2021 to cut its debt.

New car buyers are paying painfully high interest rates in the U.S., forcing some to swap their purchases out for a more humble ride or cough up record amounts upfront to avoid high payments. 

Europe’s politicians are optimistic they’ll find a solution to the e-fuels debate, which though not on the agenda for an ongoing summit is dominating discussion, sources say. Officials suggest a deal could be struck in a number of days.  

Renault and Nissan may pair up on a vehicle charging network in 11 European countries, Renault told Reuters. “It is up to Nissan to decide,” their charging unit CEO said.  

Reuters Daily Briefing

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