What to Expect From Cars, and Car Tech, in 2019

The year 2019 is when automakers go into overdrive on EVs, plug-ins, and hybrids. Will they sell more alternative-fuel cars? Maybe, maybe not. It’s also the year more automakers add new midsize and compact pickup trucks. Will they sell? You betcha; country musicians don’t sing about rainy country roads and Teslas. And 2019 or 2020 is the date when automakers have said we’d see the first wave of self-driving cars (Level 3) that allow extended hands-off driving. The jury is out on that, and it’s still probably a decade away before we see what people consider truly autonomous cars, essentially Lyfts without drivers.

There is a split among what automakers are developing, what buyers want, what buyers want when gasoline is flirting with $2 a gallon, and what’s happening to Planet Earth if we believe to be accurate the 97 percent of research papers that say global warming is an accepted fact.

Here are five trends that shape cars, SUVs, and driving in 2019 and then into the second decade of the 2000s.

1. Cheap Gas Gives Pickups, SUVs Two-Thirds of Market

Ten states will likely begin 2019 with the price of regular unleaded gasoline below $2 a gallon, says AAA: Missouri, Oklahoma, Arkansas, South Carolina, Texas, Alabama, Mississippi, Louisiana, Kansas, and Iowa. Our interpolation of late-2018 data (the government shutdown has us running what-ifs on Excel, in lieu of furloughed feds) says the average price of gas at the start of the year, the average of all states, will be around $2.20 a gallon. That’s the historical average price for regular the past 90 years and a huge decline since we spent 2011-2014 living with $3.45 to $3.85 gasoline.

Cheap gas and cheap loan rates for 60 to 84 months made it possible to buy bigger vehicles or cars and trucks with more options. The single best-seller in the US, the Ford F-150 pickup, is likely to account for 900,000 units out of 2018’s estimated 17 million sales, a 10 percent increase on a vehicle that came out in the 2015 model year. Five years ago, cars and trucks (pickups, SUVs, crossovers) were even in market share. By late 2018, cars were at 30 percent and slipping. That has implications for CAFE, or Corporate Average Fuel Economy, the average of all vehicles sold by each automaker. Even with smaller turbocharged engines on big vehicles, and even with hybrid technology such as the 2019 Ram 1500’s eTorque 48-volt booster motor, much more than 20 mpg in real-world driving can be tough to hit for full-size pickups.

Americans like big SUVs because we carry a lot of stuff when we travel, and we’ve gotten bigger, too. The average American male is about 25 pounds heftier than in the 1960s.

Not all pickups and SUVs are monster-size. 2018’s best-selling SUVs were the Toyota RAV4 (estimated 425,000 sales), Honda CR-V, Nissan Rogue, Chevrolet, and Ford Escape, all compact vehicles. Most of them fit two adults nicely in back. You cannot sell a compact SUV these days if it’s only roomy in front.

2. A Flock of New EVs, Plug-Ins on the Way

Did you know the best selling luxury/sports vehicle in the US this year was the Tesla Model 3, an electric vehicle with at least 125,000 sales, topping the Lexus RX, Mercedes-Benz GLC, Audi Q5, Cadillac XT5, and Acura RDX? Or that all three Teslas — Model 3, Model S, Model X — will be among the top 20 best-selling luxury vehicles in 2018, according to GoodCarBadCar.net? Sales of electric vehicles that qualify for the federal EV tax credit — EVs or plug-in hybrids with at least 16-kWh battery capacity — will be 325,000-350,000 vehicles this year. That’s a 20 percent increase over 2017. And still, it’s just under 2 percent of the US market of 17.5 million light vehicles.

New players are coming to market. The electric Jaguar i-Pace is our wfoojjaec Car of the Year, a serious competitor to the Tesla Model S, and better-looking. The Porsche Taycan (formerly Mission-E) is sold out for a year and the majority of buyers placing $5,000 deposits were Tesla owners, Porsche says. Two US-focused companies are showing electric sedans, crossovers, and even a 400-mile pickup truck: the Byton (top image) and Rivian. They’re aiming to build share of mind in 2019 and launch in 2020.

A year-end article by Dan Neil, Pulitzer-winning auto writer for the Wall Street Journal, headlined “Think Electric Vehicles Are Great Now? Just Wait…,” takes the view that only pure EVs matter:

… internal-combustion (IC) just doesn’t work for me anymore. In the car market I am a human headwind. … This is above all a pocketbook issue for me. A gas-powered vehicle would be too expensive. I plan to keep my next vehicle 10 years, at least. Over that time the cost of ownership for an EV, including fuel (on the order of a penny a mile for the electricity), repairs and maintenance would be considerably lower than comparable costs of an IC car. My other big worry: resale value. In case you haven’t been following the news from the Paris climate talks, most nations of the world have put the IC vehicle under a death sentence.

… The steady improvement in lithium-ion batteries’ energy and power-density over cost will render the latest plug-in hybrids comically superfluous in a matter of years.

Substitute 2030 for “now” and I’m buying in. There’s still lots of value now in plug-ins. Most journalists, like most Americans, live within 200 miles of the ocean. But in the American heartland, public charging stations come fewer and farther between. A plug-in gets you the first 20 to 50 miles on battery power, and those miles cost no more than half the cost of gasoline miles. Then the combustion engine takes over and the plug-in parts give it hybrid-like functionality. But a plug-in carries a noticeable price premium, offset by the federal tax credit of up to $7,500.

Meanwhile, as for hybrids: Toyota makes the hybrid price delta almost immaterial, a meager $800 surcharge on a $30K vehicle, and you get 39 versus 29 mpg EPA city mileage. And it’s faster than the gas-only RAV4. Still, plug-ins are taking hybrid market share. In California, sales of EVs, PHEVs, and hybrids reached 9.1 percent of new vehicle registrations, the highest of the US states: 3.3 percent pure EV, 2.9 percent PHEVs, and 4.0 percent hybrids (versus 7 percent in 2013).

Even pickups are going hybrid. The well-received Ram 1500 offers eTorque, as mentioned above, a 48-volt booster motor that adds low-end oomph. Real men love torque. BMW, one of the last adherents to diesel power, has shifted its sights to plug-in hybrids near-term because they provide roughly the same fuel economy as diesel, and your hands don’t get as greasy when you refill with gasoline.

3. Rest-of-World Is Bigger Than We Are

Oceans, national borders, and border walls don’t keep out the rest of the world’s pollution. East Coasters (and Canadians) deal with near-Midwest factory pollution, and the West Coast collects some of the effluent from factories on the other end of the Pacific.

The automotive world is going electric; the combustion engine is on (long-term) notice. Not everyone believes it, just as not everyone believed battleships would be replaced by aircraft carriers, or the 8mm movie by videocassettes and then by the shiny disc DVD which is being killed off by streaming. (You can buy Crazy Rich Asians for $20 on DVD or Blu-ray, or stream it for $3, and most people will find one viewing is enough.)

Successive iterations of the combustion engine with gasoline direct injection, cylinder shutdown, and variable valve timing are resolving some issues. Fuel economy is up and emissions are down. But the combustion engine cannot get around the one zeppelin-size fact: Emissions of carbon dioxide (CO2) are emitted in direct proportion to how much carbon fuel is burned (gasoline, diesel, natural gas). That contributes to global warming. Ninety-plus percent of research papers (not scientists) say global warming is man-made, including 97 percent of papers analyzed in 2015-16. Light vehicles (cars, pickups, SUVs) are not the only culprit. But transportation as a whole — planes, trains, automobiles, buses — accounts for more than half. Thus the push to electrification. Using fossil fuels to produce electricity for cars is at least twice as efficient when it’s burned by the utility company, and more so if it’s solar, hydro, wind or nuclear (the latter of which is very safe most of the time, with the handful of exceptions such as Three Mile Island, Chernobyl, and Fukushima). To jumpstart electrified cars, the US government has offered tax credits on hybrids and now on EVs to offset the higher costs of newer technology; not everyone believes that’s a good idea even though we have subsidized and regulated crop production since the 1930s.

The rest of the world is different from the US and North America because ROW has all but three of the 40 or so megacities, places with populations of more than 10 million and health-endangering levels of pollution. (We have Mexico City, New York, and LA; Toronto is a near-megacity). Where North America ponders EVs, cities like Shanghai, Delhi, Guangzhou, Beijing, Manila, Shenzhen, San Paolo, Lagos, Wuhan, Dhaka (Bangladesh), and Chengdu need them desperately to cut air pollution. Ever hear of Harbin, Jinan, Nanjing, Shantou, Changzhou, Xi’an, Hangzhou? Those are China’s “small” megacities, each with fewer than 15 million population.

If the US wants to be a technology provider to China, beyond what China can glean from our poorly protected server farms, the US needs to be a leader in electrification now. Also, some of our brand names are magic in the rest of the world. A case in point is Buick. Of the 1.4 million Buicks sold worldwide, just 219,000 were sold in the US, while 1.18 million were sold in China (plus 22,000 scattered through the rest of the world). GM sold 4.0 million cars total in China, 2.4 million in the US.

Most every automaker has made some form of a pledge that by 2019, 2020, or 2021, every or almost every new model will be electrified in some way, ranging from a hybrid version to full electric. Volkswagen just announced the next generation of combustion engines that roll out in 2026 will be VW’s last combustion engines.

4. The Need for Simplicity, Common Sense, and Lower Cost

Fifteen years ago, the chairman of Panasonic said he could see the automobile as a commodity platform for Panasonic’s and others’ electronics. The automakers blew off the idea as hubris. Now, virtually every automaker offers Apple CarPlay and Android Auto in addition to their own infotainment interfaces. Car buyers had enough grief from the early years of Microsoft/Ford Sync, and more recently, from devices that took away knobs and buttons for the joys of touchscreens on bouncy roads such as Cadillac CUE. Now we’re shifting back to sanity.

Simplicity can mean knobs and buttons in addition to touch commands (the work fine when the car is stopped), big buttons instead of small, big rubbery knobs instead of tiny chromed knobs.

Common sense means understanding what buyers want in their local markets. If buyers in the megacities of Asia or Africa want (need) EVs, Americans would really like warnings that don’t make shrill prompts. Asian cars especially make lots of noises that alert the driver and passengers; it may be that in their worlds, the person in the passenger seat (often female) would not correct the driver (often male) upon hearing a warning beep. One luxury automaker brought its first car to the US several years ago with a ventilated front driver’s seat, but not one for the passenger, based on the gender hierarchy in the home country.

Many automakers think of their cars as mechanical devices with some electronics on top. Buyers see the electronics as the reason cars are different from year to year. And they see most non-automotive electronics as going down in price, so they expect cars to have more features and still cost less. “As if,” say the automakers. Automakers are coping with common platforms. Volkswagen Group, owner of a dozen brands up through Bentley and Lamborghini, will create one platform for most of the brands that use front-drive (or all-wheel-drive with front engine) for several sizes of cars and SUVs. They turn to third parties to help them develop infotainment systems and driver assists.

You’d think BMW and Mercedes-Benz have enough margin built in to not worry about parts costs. But in fact, they are pondering cooperation on “key automotive components” that are not competitive, according to Bloomberg. That might be on mufflers, improved parts stamping, seat safety systems, or protective door beams, but not suspension components that make for distinctive handling. It might be the radars and cameras for self-driving, but not the algorithms that separate the two. Cooperation already exists: BMW and Toyota cooperated on the next-generation Z4 and Supra that has the BMW engine in both. The only way Mazda could afford to build the current MX-5 Miata was by licensing a version to Fiat as the Fiat 124. GM and BMW in the past collaborated on a complex hybrid-engine transmission. German automakers Audi, BMW and Daimler collaborated on mapping when they bought HERE Technologies. Ford and VW may collaborate on vans. Broadly, automakers are bonding to make sure Alphabet (Google) and possibly Apple don’t become the leaders in self-driving and ride-sharing.

Simplicity for many people includes safety features and safety suites. Honda and Toyota are leaders with named suites: Honda Sensing, Toyota Safety Sense. Others are adding similar packages, such as Ford with Co-Pilot 360. Be careful: Some automakers omit them from their entry models to make them less expensive (and some stripper trim lines are less than 5 percent of the model run, so you don’t encounter them). Others build safety suites that lack either blind-spot detection or lane-departure warning. You want both features, plus adaptive cruise control, plus automatic emergency braking (which is usually included if the car has lane departure warning since both use the same camera).

5. Cars You’ll Miss (But Never Bought)

Just five years ago, cars and trucks/SUVs had half the market each. With sedans inching below 30 percent, many of them are going away. Chrysler is down to one sedan, the Chrysler 300. Ford’s sedan lineup is almost a goner, too: the Focus, Fiesta, Fusion, and Taurus as well as the small C-Max crossover-ish vehicle, are departing. That leaves the Mustang. Ford President and CEO Jim Hackett said,

We are committed to taking the appropriate actions to drive profitable growth and maximize the returns of our business over the long term. Where we can raise the returns of underperforming parts of our business by making them more fit, we will. If appropriate returns are not on the horizon, we will shift that capital to where we can play and win.

General Motors is jettisoning many of its sedans, all of them well-built and fuel-efficient, with cockpits that no longer resemble velour bordellos. They include the full-size Chevrolet Impala and similar Cadillac XTS, the midsize Chevrolet Cruze, and the aging Buick LaCrosse. No surprises there. But GM also jettisoned the full-size Cadillac CT6, a sporty full-size car with very good handling and SuperCruise, the defacto technology standard for self-driving cars. Also a surprise departure: the Chevrolet Volt plug-in hybrid. GM CEO Mary Barra said the company wants to focus on electric vehicles, and one could argue there’s still life left for bridge vehicles such as the Volt PHEV. Old-timers will wax eloquent about GM’s fat-dumb-and-happy barges of the 1970s as the last good cars GM made. Fact is, the 2014-2019 Impala was the best full-size car GM built, so good that it replaced the Toyota Camry as Consumer Report’s choice for an affordable, roomy sedan with good handling and safety. Now the Impala will die after selling about 20,000 units this year, while the Camry, much improved after the CR smackdown, was on target to sell 375,000 units.

Note that virtually all the sedans being killed off are from US-headquartered automakers. Honda, Nissan, and Toyota are chugging along, building ever-more SUVs but also sticking with their sedans. For now.

When an automaker end-of-lifes a model, the price collapses both for current-year models as well as used cars. If you need a sedan or are torn on what you want, the next year will be a great time to pick up a new model. For a student or young adult tight on money, there will be fewer deals better than a two- or three-year-old Chevrolet Cruze or Ford Fusion with good safety features, rock-bottom prices, and a decent supply of spare parts for the next decade.

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