They LOST money. You can call it "accounting mumbo jumbo" (LOL!) all you want to confirm your own bias. But the REALITY from MANY MANY reliable sources is that they've lost fucking HUGE money on this gamble, and that's why MANY car companies are SCALING BACK on the EV side of the business. They've admitted it outright. Officially reported it, because they HAVE to. You're calling it "mumbo-jumbo," because it doesn't support your position.
I actually don't care. I don't have stock in auto companies. And I have no plans to ever buy an EV. Why would I care? What IS amusing is the fanbois in denial that their utopia is nothing more than delusion. And it sucks, because they bought into the idea big time. They're committed to it socially. And they don't want to admit they were fooled and they are wrong.
Racing loses money. R&D loses money. Carmakers spend a lot on both. It's not news. Unless you hate racing or science.
A write-down is recorded on a company's books as an adjustment to the existing inventory. A credit is applied to the equipment or whatever the inventory item is, and the total value is reduced accordingly.
Here's another nugget left out of these I hate EVs articles: Biden-era Feds and states gave subsidies to carmakers to build EVs for Biden's entire term. It's in the billions. You know where that shows up? Last year's balance sheet. And the year or two before that are listed in the chart of accounts as income for
those fiscal years. Not 2025 or 26.
Automotive bloggers and print pundits should stick to cars and not pretend they are CPAs.
All these 'losses' are connected with people costs, equipment, facilities. The assets are still on the books. Let's use the manufacturing of batteries as an example. They took the write down so all of the IP they developed. And the adjustment of the value of the physical assets reduces their earnings. Thus lowers taxes. Two years from now when they are making batteries in larger quantities, the value of the equipment, facilities, etc is largely already paid for. They havent lost anything. It's just an investment that's taking more than a fiscal year to pay off. So they say they are having a bad year because their sales forecast for 2025 was wrong. When sales pick up in a year or two, they arent starting from zero. They are starting at the 20 yard line to the goalpost and it's only second down.
It took almost two years for Ford to design and build the first Mustang. Guess what that means. They lost money for almost two years on the Mustang. And that didnt require all new technology. Just tooling. And Iacocca navigating the lumbering Ford bureaucracy.
Aviation is littered with planes that were pushing the limits of the technology in their day. Most of them didnt make it. Wars ended, wars began, civilian aviation began and the state of the art was perpetually changing. Bottom line: Lots of write downs. It doesn't mean fuck all. The technology still advances and change is perpetual. There are still planes with propellers and piston engines. But they are no longer commercially viable. A few remain in the margins. Their time has come and gone. Just like ICE cars and trucks are about to begin their plunge into obsolescence in the next few years.
ICE technology has nowhere to go. It's peaked. This is classic lifecycle engineering. Also life cycle assessment and life cycle costing is chapter and verse in every engineering curriculum. There's nowhere to go but down for the gasoline engine. You gotta be a Luddite to not accept it.
BTW: The Luddties were rounded up and sent to penal colonies.
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