The ink is barely dry on my latest Autonomy story and it has another big one. The electric vehicle subscription company – the largest in the United States – has ordered 23,000 electric vehicles from 17 different automakers to expand and diversify its subscription fleet. So far, it has only offered the Tesla Model 3 and Model Y.
The total value of this massive order list is $1.2 billion. During this quarter, Autonomy’s fleet size is 3,250 vehicles. By the 4th quarter of next year, its fleet size is expected to reach 22,790.
With Tesla dominating the U.S. EV market (often accounting for around 70% of EV sales in the country in recent years), taking off with the ground with the two most sought-after EV models was the safe, secure, smart solution. , sensible thing to do. However, as the market matures, there are more and more attractive, exciting and highly sought-after electric cars, and there are more and more “mass market” consumers who are more interested in legacy brands than to young Tesla. Of course, Autonomy’s fleet of Tesla vehicles will also grow. It will still constitute the great basis of The Autonomy fleet in the 4th quarter of next year, 2023.
“Tesla was certainly the right launch partner for Autonomy given its current dominance in the electric vehicle market,” said Scott Painter, Founder and CEO of Autonomy. “With every automaker turning to electric and so many exciting new products coming to market over the next 6-18 months, we have placed our fleet order and are excited to expand our lineup of subscriptions and to make it easier for consumers to make the switch to electric.
The US market for electric vehicles is not huge. Autonomy expects its orders for 23,000 vehicles to represent about 1.2% of all electric vehicle production in the United States through the end of 2023. (Interestingly, the total amount of purchases is $1.2 billion and that this represents 1.2% of U.S. electric vehicle production projections for that period.) The orders were “designed to fit within the projected production envelopes of each Car manufacturer”. They were placed in the fleet departments of:
- BMW (OTCMKTS: BMWYY)
- Canoo (NASDAQ: GOEV)
- Fisker (NYSE: FSR)
- Ford (NYSE:F)
- General Motors (NYSE:GM)
- Hyundai (OTCMKTS: HYMTF)
- Kia (KRX: 000270)
- Lucid (NASDAQ: LCID)
- Mercedes-Benz (FRA: MBG)
- Polestar (NASDAQ:PSNYW)
- Rivian (NASDAQ:RIVN)
- Stellantis (NYSE:STLA),
- Subaru (OTCMKTS: FUJHY)
- Tesla (NASDAQ:TSLA)
- Toyota (NYSE:TM)
- Volvo (OTCMKTS: VLVLY)
- Volkswagen (OTCMKTS: VWAPY)
Autonomy was a key criterion for which to order electric vehicles. The most important selection criteria were:
- MSRP Range: $26,595 to $122,440
- Battery Range: 250 miles minimum (with some exceptions)
- Telematics: Fully Connected
- Production forecast: the vehicle will be available for purchase before the end of 2023
- Residual values: models with the highest projected resale values
This last question is interesting. For years, we have performed analyzes of the total cost of ownership (TCO) of electric vehicles compared to their main gasoline-powered competitors. We found that one of the biggest expected cost benefits was higher resale values for electric vehicles, especially Teslas. As it turned out in reality (so far), even bullish estimates of the resale value advantage of electric vehicles were good or conservative estimates. We’ll see what happens in the future, but resale value is such an important part of a TCO analysis that it’s interesting to see not only that Autonomy used it as a critical yardstick, but that the company shared this information.
What dampens consumer interest in EVs are the higher upfront costs, but anyone who looks into the matter can see that the long-term total cost often favors EVs. Autonomy’s solution is simple: we buy the EVs, take the long-term financial risk, and offer people monthly subscriptions (not the long-term leases they’re locked into) to lower the cost of entry. and the long term. financial commitment for more Americans.
“EVs cost significantly more than gas-powered vehicles, and most consumers simply won’t switch to an EV without very compelling value propositions,” Painter said. “Autonomy subscriptions provide an easier and more affordable way to get an electric vehicle, and that’s why we believe subscriptions will be the predominant contract by which consumers adopt electric vehicles from all automakers. “
No long-term debt. No lease contract. No large upfront payment. And the freedom to switch from one EV to another as your desires change, as news (good or bad) about certain EVs arrives, as EVs with more range or capacity arrive on the market, or that the EVs you’ve been waiting for are finally produced.
Autonomy’s news ahead of this big order announcement was that the startup had partnered with AutoNation (NYSE:AN), the largest auto retailer in the United States, to distribute the vehicles it orders across the country. , to prepare them for delivery to customers, to deliver them and also later to maintain and repair them. An exciting new element of this partnership is: “In preparation for order fulfillment, Autonomy has mapped vehicle deliveries to the corresponding AutoNation Franchise and AutoNation USA locations closest to the manufacturers’ distribution centers. automobiles in areas with the highest density of electric vehicle registrations.” For more on the original announcement, see: “AutoNation Gives Autonomy EV Subscriptions a Boost”.
Note that Autonomy customers cannot immediately switch to a monthly subscription. They must start with a 3 month subscription. But after these 3 months, customers have enormous freedom. I have to say it’s tempting! I love my Tesla Model 3, but how fun would it be to go through a dozen or two dozen different EVs, live with one model for a few months, then move on to another to try something new? It’s attractive. And you don’t have to go to a dealership to do it! You can do it all through an app – available at google play or the Apple App Store.
Additionally, Autonomy notes that once you’ve chosen an electric vehicle, it could be available within weeks, whereas getting a new electric car by loan or lease typically involves a 6-9 month wait in this moment.
We will provide more information as we delve into the orders placed by Autonomy.
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