Serious EV power from Croatia!

I’m sure most, if not all readers of this blog have a few automotive legends of their own. Henry Ford is no doubt part of most people’s list as the man who gave us the first mass-produced automobile. I would of course also cite some of my Italian car legends that you’ve seen featured on this blog, and no doubt include Christian von Koenigsegg as well, the Swede who built the world’s fastest car from scratch on the countryside in Sweden. These days however, at least for the general public, Elon Musk is probably the biggest of them all. You can debate how much of a car company Tesla is (or for that matter how sane Elon is), but you can’t debate the success Tesla cars have had (and as shown last week, this goes for the resale values as well!).

What’s fascinating with Elon next to the fact that in addition to cars, he also builds rockets that he lands back on earth after the flight, is that just like Koenigsegg, he started from a piece of paper (albeit with lots of money in his pocket). He did so in the biggest car market in the world, but of course he himself is South-African. Let’s just say that the odds of success weren’t necessarily on his side, and they were even less so for Koenigsegg, as also highlighted in my piece last year. So in that case, how would you rate the odds of a 20-year old Bosnian setting out to build the fastest EV supercar in the world in neighboring Croatia? Yeah, right. You’d be wrong though, because his name is Mate Rimac and he’s quickly developing to becoming something like the next Elon. This week, we’ll look closer at him and the car brand carrying his name!

Rimac’s electric BMW – the fastest EV in the world at the time!

Mate Rimac is only 34 years old, but he’s already accomplished more than most do in a lifetime. Having grown up in Germany and Croatia, he participated in various innovation contests at a young age and in 2006, after having exploded the engine of his BMW E30, decided to transform it to an electrical car. So he did and not only that, he made it the fastest EV in the world at the time, which got him quite a lot of press coverage that would turn out to be very useful a few years later. Mate also competed with the car against traditional combustion engines and usually won, and it was sometime around here that he became convinced of the potential of EV’s and decided to set up a company and build better cars than Tesla. At the same time he invented a few other things as well, such as a rear-view mirror without blind spot and the iGlove, aimed at replacing the computer mouse and keyboard. It didn’t, but there’s little doubt Mate had lots of ideas in his head and by the looks of it, still does.

Mate Rimac and the Rimac Concept One

At first, Rimac’s company focused on conversion of traditional cars to electric drivetrains. That business developed nicely and became known as Rimac Automobili in 2009, when Mate was 21. It took him another two years to get a few employees at the company’s HQ in Croatia, and at this time he also met a GM designer called Adriano Mudri. The two men got along and started discussing building an EV supercar together. Thanks to the previous garnered publicity, they also got an invitation to the royal family of the United Arab Emirates who would become the financier of Rimac’s first prototype called Concept One, unveiled at the Frankfurt Auto Show in 2011. Eight Concept Ones were built in total and as far as I know seven are still around, the eighth having been crashed in quite spectacular fashion by Richard Hammond of (the original) Top Gear. That’s without doubt the most expensive car Hammond has ever crashed…

Next to the car however, Rimac continued to work with other brands on modifications and parts related to electrification. These include Porsche, Aston Martin, BMW and Koenigsegg, and in 2018 VW/Porsche also bought a 10% stake in Rimac. Last year, it was then confirmed that the partnership has been extended to a new company called Bugatti Rimac where Rimac owns 55% and will provide electrification to the coming hybrid Bugattis. Porsche is also said to have invested further in the company in its latest financing round. As if that wasn’t enough, Rimac also produces the battery systems for the Aston Martin Valkyrie and the Koenigsegg Regera.

The Nevera – a mix of other sports cars and old uniform neckties!

With a top speed of 220 mph (roughly 350 km/h) the Concept One was no doubt extreme, even for an EV, especially 10 years ago. This was however only the hors d’oeuvre for what was to come. The even faster Concept S would follow in 2016 as more of a track car, before the Nevera was unveiled in 2018 and is being delivered to customers form this year. With 150 cars being built for a price of EUR 2m these customers are to be considered very lucky, as this 1914 hp monster sets a new standard even for EV’s. With a top speed of over 400 km/h and a 0-100 time of 1.85 seconds, it also reaches 300 km/h in nine seconds, faster than an F1 car and something that will most probably have you searching for your eye balls at the back of your head, should you try it.

Of course speed isn’t enough though, and the Nevera (which by the way is the name of a Mediterranean storm – what is it with auto makers and winds??) certainly looks the part. It’s a beautiful car with hints of the new Corvette at the front and a McLaren of your choice in the back. Air vents along the sides have the same shape as the necktie of Croatian soldiers fighting for Napoleon (you’d be forgiven for not noticing that yourself…). Of course almost every panel is carbon fibre, it uses butterfly doors and a break spoiler in the back, deploying at a predetermined speed. Rimac confesses he’s programmed that speed to be low enough for the spoiler to deploy frequently, as clients find it cool….

Quite a plush interior given the car’s power, more of a GT than a track car

The Nevera has four electrical engines, one per wheel, which are thus operated and adjusted individually, further contributing to great handling. The interior is more plush than you would expect and definitely more of a GT car than a track car. That doesn’t mean it drives badly though: the first of the 150 Neveras will be delivered to ex-F1 world champion Nico Rosberg who is enthusiastic about not only the power but also how the car handles. In terms of colors you can of course have whatever you want – Mate himself has chosen raw carbon fibre for his own Nevera, a bit of a debatable choice but who are we to argue…

We’ll see where Rimac goes from here, but both the cars and the prestigious collaborations have put him on a fast track for even greater things going forward. From interviews and videos he also seems like a genuinely good guy, which is always nice to see. Notably all Rimac employees, from the cleaning stuff and up, have a share in the company. Of course, unless I have more prominent readers than I know, neither you nor I will probably have the pleasure of driving a Nevera or see for ourselves how nice Mate Rimac is. There is however another way to experience the Rimac magic, namely by buying an electrical MTB from his other company Greyp Bikes, founded in 2015. That will save you a couple of million, be better for your health and give you the first MTB that can communicate with all other Greyp MTB’s around the world, and also film what happens behind you when you ride. If that’s not an irresistible offer, I don’t know what is!

EV’s will never rule the world

A few months ago, as spring was still losing the fight against the last efforts of winter, I attended a financial conference close to Zurich. That’s one of those events where asset managers meet up with investors to tell them why they are the best option to invest with, in whatever theme they feel is of most interest at the time. Not too long ago, these events still had some diversity to them, as you had the opportunity to speak to a great variety of managers on different strategies. Those days are gone. Today, everything, and I really mean everything, is around ESG (Environmental, Social & Governance) and impact. In a way that’s great – I’m absolutely convinced of companies needing to behave like good citizens, both towards their employees and the environment (which is what ESG is about), and if they can report some concrete metrics on that good behaviour (which impact is about), then all the better. What I don’t like is when the discussion gets stupid, because when it does, it also gets counter-productive. In this case, as you probably guessed already, it was about EV’s.

Is everything really green in EV land? Eeh… no.

One of the sessions I chose to attend was with a portfolio manager (PM) who started by presenting his team with their name, role and how they commuted to work. The options were bike, public transport or EV, and when someone asked about conventional cars, she was told that wasn’t allowed on the team. The PM thereafter spent whatever was left of his 20 minutes to talk in extremely broad, non-committing terms about how we were all going to die very soon unless we all invested through him in cool companies such as Tesla and solar panel manufacturers, rather than the terrible old dinosaur industrial companies, to which he gladly also counted traditional car manufacturers who now build EV’s – go figure. To conclude, he then looked at his client relations guy standing next to him and explained how he had convinced him to buy a Tesla, and how happy he was by now. Apparently the colleague wasn’t trusted with saying this himself.

In the context of what was supposed to be a serious, institutional investor conference, this was all a bit too much for me so I put up my hand, congratulated the client relations guy on his new car and said I hope firstly he didn’t have a car before, since replacing it with an EV in most cases and for a very long time will be detrimental to the environment and not positive from a total emission perspective, and secondly that I hope he drives a lot, since he’ll need around 100.000 km’s for his Model S to be “net positive” in total CO2 emissions compared to a conventional car. I added that I’d be interested in knowing where the solar panels of the mentioned company were produced. All this made the PM quite excited, and in a rather arrogant way (how dare you question the wisdom of EV’s??) told me that the 100.000 km number was absolutely not correct and based on “biased research by the petroleum industry”. He never gave a number himself. With regards to solar panels, he had to admit that a large part were still produced in China, but “not in the problematic parts”. Stupid me – I wasn’t aware there were parts in China which are not a Communist dictatorship…

It’s been a year and a half since I published one of my most read posts on EV’s and how they won’t save the climate (catch it here if you missed it). One of the main points in that post was on the “CO2 deficit” of EV’s, i.e. the very large amounts of CO2-emitting energy that goes into their battery production. This fact was validated by a study I learnt of recently, commissioned by VW in 2019 and done by the Austrian Joanneum Research Institute together with the German automobile club ADAC and the excellent German Economics Professor Hans-Werner Sinn.

Given the above, it’s safe to say that almost no EV’s make sense from a CO2 emission perspective.

With apologies for the bad quality (coming from the fact that I took a picture of the screen during a presentation by Prof. Sinn), it’s pretty easy to see why VW didn’t want a lot of publicity around the study’s results and instead chose to bury it in a basement somewhere before it was leaked to the public. You see, the results go against the complete electrification VW and all other car makers in the world are currently embarked on. The diagram is based on the total CO2 emissions of a car, so for an EV including the production of batteries, and the two lines depict on one hand an electric Golf and on the other the same car with a diesel engine. As the graph makes painfully clear, for a country with an electricity mix comparable to Germany and Austria (and there’s quite a few of those), the 100.000 km number the PM claimed was exaggerated is actually quite the opposite when compared to an economical diesel engine. If you go by the yellow vertical line that shows the average lifetime of a car in Germany, the EV simply never catches up.

Russia’s war in Ukraine has laid bare especially Europe’s dependency on Russian energy and is now talked about as something that will accelerate the transition to renewables, which on a global basis still make up less than 2% of the energy mix. This reasoning is often accompanied by statements of how solar panels and wind mills will continue to get cheaper according to a version of Moore’s law (which refers to how the number of transistors doubles every two years whilst prices of computers are cut in half). This is quite simply wrong.

Firstly, the material cost of notably metals that go into the production of all renewables has a worth that will always prevent the cost from going below a certain level. Most of those metals have price-wise been at a historical bottom during the last ten years or so, until very recently. If you combine that with a cost of financing that with interest rates at zero has been as low as it can get but is now moving up, everything points to renewables getting more expensive going forward, not the other way around. To which should then be added further issues such as notably the extraction of required metals from great countries like Russia, China and the Congo, the many tons of cement needed for the basements of wind mills and so on. That’s not good news for anyone, especially since the ESG-movement has been very good at preventing any form of investment in oil, gas, and even nuclear, a non-polluting and non-weather dependent form of energy. That’s obviously where it gets stupid.

Coal is still the world’s largest energy source, and no country has more coal mines (and workers) than China

Some countries have a better energy mix than Germany and Austria and with cleaner energy sources, the EV equation improves. There are also initiatives to recycle battery metals and even replace especially cobalt, and there’s obviously research into steady-state batteries and so on. That’s all great, but it won’t be here tomorrow or even in a few years, and the issue of scale is still huge. Quite simply, we are very far away from having the battery or other storage capacity required for an energy system based on renewables, and such a system would also by definition assume massive over-investment, such as to produce enough energy to store when the wind blows and the sun shines. I don’t know about you, but the more I look at wind and solar power, the more I’m convinced that this is not what our future will be built on. I am however as convinced that we will manage to solve the energy equation such as to reduce emissions, quite simply because human creativity is unbeatable at solving challenges, and emissions is a challenge we need to respond to. But we need to be smart about it.

Stock performance YTD per 9 July. It was more fun investing in EV’s last year… Volvo Cars is included as owner of Polestar.

We all suffer at the pump these days and as previously said, things won’t get better anytime soon (rather the contrary if you consider that China has basically been in lock down, i.e. not consuming a lot of anything, in the last months, but is now opening up). I fully understand if you choose to buy an EV, especially if you can produce your own energy through solar panels (preferrably not from China) or otherwise, but please don’t tell your friends how you are helping save the environment by doing so, because in most aspects, you’re not. For those without their own electricity production, unfortunately it can be expected that electricity prices move up as well. It seems the market is starting to realize that as well, as illustrated by the stock price performance of EV’s this year, as illustrated above. I haven’t checked on the recent performance of the funds managed by the PM I met at that conference but looking at the table, I think I have a pretty good idea!

What’s new in the EV world?

Although EV’s are not the focus of this blog, there’s quite a bit happening on the EV front so that I feel it’s worth giving you a small round-up of what I believe to be the most important recent developments. The first thing to point out is obviously that the long awaited jump in EV sales is now really happening. The below graphic gives a nice illustration of where sales are surging (China, Europe and the US in order of importance) and where not (somewhat surprisingly Japan, where EV’s make up less than 5% of all EV sales worldwide. Japan has a lot of hybrids however). Putting these numbers in context shows that EV’s hereby represented 12% of all cars sold in China, approximately 11% in Europe (including PHEV) and 3% in the US. So the growth is clearly there and accelerating, but we’re still not at the point where EV’s are close to taking over.

Tesla claims the two top spots in the US with its models 3 and Y, and the Model 3 is the best selling EV in Europe as well, ahead of the VW ID3, the Renault Zoe and the VW ID4. In China the top seller is a car I’m sure you’re all familiar with – the Wuling Hong Guang MINI EV. No? The Wuling is a Chinese mini electric car, the size that actually makes most sense for an EV. It’s ahead of, yep, the Tesla Model 3 and Y. It’s worth noting that not only do the two Teslas claim the top spots in most markets, they are also by far the most expensive of the EV top sellers, making their numbers even more impressive. It’s also interesting that even in the US, the two other models S and X don’t see many buyers anymore.

The leading Chinese EV is rather small and not very aerodynamic

So much for existing sales, but much more interesting is looking at the new market entrants, and there’s quite a few of those. I’ll focus here on the ones I for different reasons believe are the most important: Mercedes with the EQS and other EV models now being rolled out as representative of the the in my view leading traditional brand, Lucid Motors as the most exciting new EV brand, and to round it off, why not a couple of electric pick-ups?

Mercedes-Benz landed a real PR punch a few weeks ago when it became the first car maker to receive the approval for level three self-driving in Germany. This is a major snub to Tesla but certainly not a coincidence. MB’s Swedish CEO Ola Källenius is not only using social media to the fullest, he’s also repositioning MB as a car maker that will exclusively be building EV’s by 2030. The EQS that came out a few months ago is the flagship in this regard, with the EQE (E-class) and other models now following. I’ve had the opportunity to study the EQS inside and out several times although I haven’t driven it yet, and it’s very surprising to me hearing how various commentators put it on par with the “normal” S-class. Let’s be clear, and take my word for it: if you forget the giant screens and look at other interior materials and perceived quality, the EQS is nowhere near an S-class. At the same time it’s however far ahead of Tesla and other EV’s, but so it should, given it’s also quite a bit more expensive at around EUR 200′ fully equipped. You get a pretty fully equipped, “normal” S-class for that kind of money…

Keep your eyes on the screens – what is below is less fun…

Lucid Motors is the new star on the EV sky and perhaps one that can challenge Mercedes on the luxury EV throne. Lucid’s CEO Peter Rawlinson was previously part of the senior management at Tesla, and the Lucid Air of which a few thousand have been delivered by now is an impressive large sedan that scores high both in quality, space and materials (although given what I mention on the EQS above, I’d like to be the judge of that first). The drive train is no less impressive with up to 1111hp in the top model Air Dream Edition, and a range of around 800 km (in ideal conditions). Interestingly the battery pack operates at 900V which complemented by its size helps speed up charging, something Lucid is happy to talk about. The company comes from California, the cars are built in Arizona and plans are to open up in Europe soon. There’s obviously always a risk with new brands, but Lucid has a lot going for it (including around USD 1bn of Saudi money).

The Lucid is a large car, however not a hatchback as you may think.

We will not see many of the other two EV’s I’ve chosen to mention here in Europe, but the US readers will have the opprtunity to enjoy them. They are both pick-ups, the first being the Hummer EV, easily recognized as a Hummer, meaning it still looks cool and is now fully electric. The roof can be removed in four different parts, and the Hummer also has a lot of other gadgets of the kind that seem to appeal to EV buyers. It’s also the only EV (actually, any car) in the market that can do the crab walk, meaning it can move forward diagonally. I have no clue what the practical side of that is, but I’m sure it’s fun. The second is less known until now, it’s also a US pick-up from a new brand called Rivian. The company has been around for ten years but it’s not until last year they showed their first car, the fully-electric R1T. It’s an interesting concept with quite a few interesting features which are new to the EV world, and it comes at an interesting price point around USD 75′ in the US.

Finally, let me bring you some stories of what life with an EV is like during the winter months in Europe. This is not some I’ve spent hours googling about, rather things I’ve picked up from friends or read about. It’s also not out of a wish to be mean to the EV collective, but it seems important to me that if the plan to have the whole world drive these, we need to know what’s going on out there – even in the European winter.

  • A colleague of mine set out from northern Europe to the French Alps in his Model S for a week’s skiing with the family. With around 1.000 km to drive, they needed to charge three times on the way there, as the real range in the winter months is only 250-300 kms. When they picked up the car from the (unheated) parking a week later, the battery was almost empty as it had lost a few km range every day by just being parked when it was cold outside. They just about made it to the next charging station.
  • A friend of mine put his Model X on support charging in northern Sweden as you’re supposed to, however the smaller, second battery that powers notably the screens froze, making the car unusable. I don’t know whether this was his fault or not but as a result the car had to be transported back to Stockholm on a tow truck, over 500 km away, since there was no garage in upper Sweden that could assist.
Not ideal when you’re 500 km away from the nearest garage…
  • A lady in Germany wanted to pick up her new electric VW herself at the factory in Wolfsburg to save the EUR 700 delivery costs VW required for sending it to Munich where she lives. That was a bad idea. The 600 km back home took her more than 12 hours with three charging stops. She was also freezing cold during the whole trip since the car apparently warned her from turning on the heating, as it would cost too much energy. VW told her she should have planned her charging stops better – but perhaps VW should build a car that would save her the work, as Tesla has been doing now for close to 10 years?

Let’s be clear on a couple of points. EV’s are an interesting alternative with a more efficient engine than a classical combustion engine – under certain conditions. In cold temperatures they are very far from the range claims being made, and also run into various other issues. Range anxiety during the winter months is thus very much still an issue. Also, some of the above problems could probably have been avoided by more informed buyers and owners, but as EV’s as rolled out in large numbers, we can certainly not demand of all drivers to be EV experts. Issues such as the above need to be solved by manufacturers, as spending 12 hours in an unheated car in the middle of winter shouldn’t be the future thrill of driving!

Can E-fuels save traditional mobility?

Readers of this blog know of my scepticism towards EV’s, not as a concept but as a solution to climate-related issues. I wrote about this in a recent post you can find here, so I won’t repeat myself. To be fair, things are moving in the right direction at least with regards to some of the issues raised, as I also highlighted in my recent post about Mercedes’s new EQS (see here). It does however remain the case that even if EV manufacturers become climate-neutral in their production, as long as the country they produce in is not 100% based on green energy, what they achieve is basically nothing put pushing the dirty energy consumption on to the next guy.

Even the steel is said to be climate neutral in a few years in the production of the EQS and other MB EV’s

There is however another BIG issue around EV’s that no one seems really keen to talk about, namely what on earth we’re supposed to do with the millions of fully functional cars we currently have on our streets, if the plan is to roll out EV’s for all? Don’t laugh, the question risks becoming very real as various European governments start fixing end dates for the sale of new combustion engines. A logical next step is then to start discussing bans on existing cars. But what is the plan for millions of existing and fully functional cars, and even more, what is the carbon footprint of destroying millions of existing cars and building new EV’s? Funnily, this is an aspect that is completely absent from the discussion.

I’m of an optimistic nature so I’d like to think that realism will prevail in the end – a realism that for me needs to be based on a future for traditional mobility – especially (and I’m finally getting to the topic of this week’s post), since traditional mobility doesn’t necessarily mean traditional fuels going forward. The development of so called e-fuels is progressing rapidly, and this week we’ll look at whether they are the solution that will allow for a more reasonable solution to the issue of traditional, personal mobility.

A new 12-cylinder will never be built, but it would be nice if we could still save the old ones!

Electrofuels, also called e-fuels or synthetic fuels, are produced exclusively from renewable energy. Without going into the technical details, in the case of car fuel it means producing hydrogen from clean energy, to which CO2, extracted from other sources, is added. The result is emission-free hydrocarbon, and the resulting synthetic fuels are no technically different to conventional fuels. They can thus power the same cars without modifications and also use the existing fueling infrastructure. A further big advantage is that e-fuels don’t compete with food production, a big problem for example with ethanol production that isn’t very compatible with the world’s need to feed another 3bn people until 2050, using less resources. Disadvantages? Unfortunately, there are a few, and they’re rather big.

Firstly, e-fuels don’t solve the issue of clean energy going to its use as long as the full economy doesn’t use clean energy, as you’re basically just pushing the emission onto someone else. As we’ll see below the clean energy used for e-fuels is produced very far away and thus not cannibalizing on anything else, but this is not a viable, long-term concep. Secondly, e-fuels offer far less efficiency than electricity, as long as electricity production is local. This is however an important point given that, as noted, most countries are still not 100% green in their energy production. So either you push the emission problem onto the next user as noted above, or, and this is not unrealistic, we’ll start importing for example solar energy from a sunny place such as the Middle East. If that becomes the case, then hydrogen all of a sudden becomes very competitive in terms of efficiency as it can be transported much more easily. Thirdly and lastly, as you will have guessed, the production process for e-fuels is far from cheap, and it will still take time and probably also some further technological innovations to solve both the cost and thereby also the required scale issue.

Wind turbines of Project Haru Oni off Chile’s coast

A number of automakers are looking into e-fuels as an alternative or complement to EV’s, none more than Porsche which currently runs a project called Haru Oni off the coast of Chile (where it’s very windy). They do so together with notably Siemens, and the logic for Porsche is that because of the points above and others, conventional electricity alone will not be enough to move to a clean car fleet fast enough, in view of other – rising – electricity needs in the world. The project is still in its early days but by removing CO2 out of the air through wind power and combining it with hydrogen, it aims to produced 130.000 litres of fuel next year, and 550 million litres in 2026. As a reference, around 23bn litres of fuel were consumed in Germany last year so although a lot, it would take many more such installations to get anywhere near the volume required to make this a viable alternative on a larger scale. The cost so far remains a mystery, but it’s clear that it’s nowhere near being a reasonable consumer alternative at this stage.

So at least for now, it remains at best unclear whether e-fuels will give a future to combustion engines. It’s however good to see that some thinking around fuel alternatives is going on and who knows, as so often before, maybe there will be other innovations along the way that allow for even better solutions in the end. It would however be high time for some realism to enter the discussion around EV’s and our future mobility. It would also be desirable with some political willingness to engage in discussions on where the electricity is supposed to come from in the emission-free world, when many countries in parallel wish to phase out nuclear? This can’t possibly be something only a few engineers at Porsche have thought about? And finally, perhaps someone can tell us what the plan is for the many millions of fully-functioning cars in the world? Reality is slightly more complex than what the current debate would have you believe and the sooner we’re mature enough to engage in a difficult but highly necessary discssion on it, the better.

The EV market takes off for real

Ten days ago, in a flashy, high-tech online show that you can watch here if you missed it, Mercedes-Benz presented the new EQS, the fully electric version of the S-class. I would claim that rather than just another car launch, the EQS is a real game-changer in the EV market, and likewise the last confirmation needed that the big guys are now entering this segment for real. Interestingly, it’s also a (positive!) game changer with regards to environmental factors and sustainability. This week we’ll take a look at the new EQS, which even without considering the drive train looks to be one hell of a car, and talk a bit more about why it’s important and how it will influence the market going forward. If your love for traditional cylinders (to which we’ll return next week) runs so deep that it prevents you from reading any further, in summary I think you can say that whereas the planned Super League in European football came to a very sudden death this week, there will be nothing stopping the EV Super League from taking off in 2021!

Starting with the EQS, In one simple sentence it can of course be described as an electric S-class, whis is perhaps what many people will do – but that would mean missing the whole point. Because by bringing an S-class to the EV market, Mercedes is also bringing a whole new level of luxury and car quality, where until now the only luxury has been Tesla’s giant infotainment screen.

The new EQS – notice the very long wheelbase

Starting from the bottom (literally), the EQS is built on Mercedes’s first EV-specific platform. So far EV’s not only from the Stuttgart brand but also from other large manufacturers have been built on traditional platforms, and this makes a big difference as one specifically developed for EV’s can take into account the absence of an engine and battery space far better. The new platform can also be adapted to different car sizes, something Mercedes intends to do as it rolls out an electric version of all cars in its current line-up over the coming years, some of them already in 2021. To those who know Tesla this is obviously not new, however what happens above the platform, inside the car, definitely is.

The EQS doesn’t look like an S-class and is actually a hatchback (without a frunk, as that space is taken up by various air-cleaning filters). At over 5.20 metres it’s a big car, with lots of interior space, and luggage space of around 650 litres (in addition to which you can fold the rear seats). If the design can be debated, what cannot is the fact that it’s the most aerodynamic car currently in production, with a Cw/Cd-value of 0.20. Also not open to debate is not only the quality, but also the innovativeness of the interior space, at or beyond S-class level. The most spectacular parts are probably the (optional) self-opening-and-closing doors and the gigantic so called hyperscreen (actually consisting of three screens) that extends over the whole dashboard and enables the passenger to for example watch Youtube whilst the driver has access to the navigation. Noteworthy is also that front and rear passengers are independent both in infotainment and speech commands, and chan thus address the car by “Hey Mercedes” independently of each other. The EQS also sets new standards in driver profiles and indiviualization, and the list goes on, and on, and on. Two interior design lines are planned, a more elegant and a more sporty one, and if the hyperscreen for some reason isn’t your thing, you can opt for the mid-mounted “iPad” of the new, “normal” S-class instead – a simple example of how a large car manufacturer can cross-fertilize various items between product lines.

The hyperscreen in the elegant layout version

The EQS is set to come to dealers this summer and will initially be available with 333 or 524 hp as rear- and all-wheel drive. An AMG version is set to follow later. The range will be up to 770 km WLTP, which should translate to something like 600-650 km in real life under pretty ideal conditions. This is a really important point, as no one has so far been able to compete with Tesla’s superior range – until now. Prices aren’t known, German media expect them to start around EUR 110.000 (with as always an almost unlimited upside…), which means pretty much on par or actually even slightly below the regular S-class. Mercedes have stated that they will earn less by car produced than for conventional cars, which in turn means they believe strongly in the growth of the EV segment. If pricing at this level is confirmed it goes against what has been the case so far, where EV-versions from traditional brands such as the Audi E-tron or the MB EQC tend to come at a premium to diesel or petrol versions.

The hatchback rear with the mandatory light bar

As stated previously on this blog, I don’t subscribe to the view that the big car companies have missed the EV train, quite simply as it hasn’t left the station yet. Although the amount of media attention it gets would make you believe it’s already a significant percentage of new car sales, the global EV market is still around only 2%, however with growth really starting to take off in selected markets in Europe, as well as in California and other places. Also, if you except small EV’s with a 150 km range, the market has basically been owned Tesla until now, as we know a three-model car company with only one of them, the Model 3, selling outside of the US, and with the exception of improved range and software, no significant facelifts or updates since the models were launched. I’m sure most large car brands have watched the market carefully whilst preparing in the background for the day growth takes off, and nowhere more so than in Germany. From that perspective, Mercedes’s timing looks pretty impeccable to me. The VW group is about to introduce its new EV platform with notably 20 electric Audi models rolled out over the coming five years, and others will follow close behind. Given the expertise all of these have in building not only cars, but also real luxury cars, the fundamentals of the market are probably about to change, which in turn will make life hard for Tesla, especially in Europe.

Last but not least, let me come back on the sustainability of EV’s that I was very critical of in my post back in January (see here), and that indeed still deserves to be looked at critically, notably in terms of the “CO2 cost” of battery production. If you saw the introduction of the EQS, you may have noted Mercedes CEO Ola Källenius saying that the battery train of the EQS will be produced in Germany in a carbon-neutral way. This sounded a bit too good to be true, so I was in touch with Mercedes’s customer relations this week to have it confirmed, and very impressively, they came back to me in 24 hours. Not only did they confirm that from the first car built, the EQS’s battery pack will be produced exclusively with fossil-free, CO2-neutral energy. They also said that every Mercedes factory in the world will be carbon-neutral by 2022, with some of those in Germany already being so. This is obviously very good as it resolves one of the main issues around EV’s, and will hopefully influence both the public and competitors..

The car can still charge quicker than most stations, but Ionity has really taken off!

EV’s have a lot going for them, and resolving some of the issues with the battery production adds to the positive list. I believe that what Mercedes now starts with the EQS will be a game-changer for the direction of the EV market, as others can be expected to follow close on their heels. In parallel, the European Ionity charging network is growing quickly, already providing a far better coverage than could be expected a few months ago. So whereas I still don’t think you should take your 10-year old car to the car scrap, it definitely looks like the future is electric, and that it may happen quick than I would have thought only a few months ago. Thus, if I were in the market for a new S-class, I would probably think twice about which one to get. In a couple of years, maybe that won’t even be the main question for the typical S-class buyer, but rather if an S-class can really be a hatchback…