Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday
Looks Like Macron Doesn’t Want Automakers To Flee To The Land Of Freedom Fries
We’ve already covered how the Inflation Reduction Act is causing global automakers to move to the United States (along with cheaper energy and a market for EVs). Why? The sweet sweet tax credits that help automakers reduce the price of their cars are contingent upon production in the United States. You know who doesn’t love this? European leaders already worried that disruptions from the war in Ukraine are already going to send automakers looking elsewhere to build things, apparently. To wit, Reuters is reporting that French President Emmanuel Macron is going to have a dinner for execs (including from Volvo and BMW) to try to convince them to say. From the report:
Carvana And The Lemonade Stand Problem
[…] We’ve covered how the alt-car dealer has faced numerous lawsuits from state authorities and the risks that come with the securitization of its loans. Now Carvana is going to cut 1,500 jobs after cutting 2,500 positions in May. The Street has an email from Carvana’s CEO kind of explaining why. The underlying fundamental proposition of Carvana (mostly online, low pressure used car sales) isn’t a bad one. It’s basically CarMax 2.0. What Garcia isn’t saying here, though, is that the company benefited greatly from the pandemic economic environment (low interest rates, low unemployment, and federal stimulus checks) and used that tailwind to rapidly expand and “failed to accurately predict” what would happen when that environment shifted. In addition, “we failed to accurately predict how this would all play out and the impact it would have on our business. As a result, we find ourselves here.” Think of a lemonade stand. You decide to sell lemonade in April and it’s a hit. By June the temperatures are super high and there’s been no rain for weeks. You sell more lemonade and make more money. With cold weather coming your best options are probably to diversify (hot cocoa stand?) or bank that profit to make investments over the winter to have more lemonade stands ready to go next summer. What Carvana seems to have done is… just keep building lemonade stands as fast as they could in the hopes it would stay warm forever.
Scooter Company Bird Is In Even Worse Shape
Micromobility (lol) company Bird probably wishes it had Carvana’s problems. Here’s a real quote from their latest filing with the SEC about their financial statements for the last two years: Ouch. The translation is: We screwed up and the money we said we made was more than the money we actually made. What happened? According to TechCrunch, it seems like the company reported that they made money on trips that people took but didn’t actually pay for because the riders didn’t have enough money in their accounts. Bird went public with a SPAC (lol) last year and raised a bunch of money with a stock price as high as $8.29 per share last December. The price as of this morning? $0.20. That gives the company a market cap of about $51 million. Double ouch.
Ram Is On Fire, In The Bad Way
If you have a Ram 2500 model built between 2020 and 2023 or a Ram 3500 built between 2020 and 2022 you might want to carry a fire extinguisher with you in the cab of your truck. Chrysler is recalling almost 250,000 of the trucks over a fire risk. Here’s the full letter from Chrysler, explaining what’s probably happening: If you have one of these trucks you can expect a letter soon explaining how they’re going to fix this.
The Flush
Have you ever used a scooter rental service? What was your experience?
Photos: Emmanuel Macron/France, Carvana, Google, Stellantis
Which isn’t helped by the fact that Carvana is just Ugly Duckling/DriveTime in a new paint scheme, but now with more illegality. They’re facing uncountable lawsuits for failing to register cars, failing to transfer titles, license suspensions, selling known lemons without required disclosures, and at least 3 class actions including one shareholder class action alleging material misrepresentation.
Which based on history will do absolutely nothing. Ernest Garcia II and III and their friends will keep their billions, switch frauds again, and commit some more crimes to make themselves wealthier.
“Ouch. The translation is: We screwed up and the money we said we made was more than the money we actually made.”
Actual translation: “Uh yeah remember all those laws that came about because of all the accounting fraud? We engaged in some light accounting fraud. Everywhere. The whole time.”
If the regulators actually did their jobs, they’d be perp-walking every Bird executive that signed the filings.
“A build-up of pressure and heat inside the transmission may result in a transmission fluid leak from the dipstick tube.”
Well, that’s not good. This specifically affects the 68RFE. The 68RFE’s an evolution of the 545RFE. They’ve always had a problem with the pressure transducers, but that’s the sensor which should warn of the overpressure. (It’s also a pretty minor repair. No transmission drain required.) But the pressure levels in these is fairly low. Low enough that a Sonnax line booster’s pretty much step 1 for poor shifting complaints. So this is almost certainly a mechanical installation defect – crushed/damaged O-ring, or incorrect O-ring on the dipstick tube.
Which is the one, singular, obnoxiously difficult and complicated repair on these transmissions. It’s easier to do the entire valve body than the dipstick. You pretty much have to disassemble the driver’s half of the engine to get clear access. Otherwise it’s threading a needle blindly.
“Have you ever used a scooter rental service? What was your experience?”
Nope. Seen enough of them and their people that even if the whole idea wasn’t ridiculous to begin with, I would never trust any of them with my credit card information.
What I referred to as an O-ring for simplicity’s sake is actually a rather more complicated part, referred to as a ‘dipstick tube boot’ or ‘boot seal.’ It’s an inch long rubber piece that essentially incorporates two O-rings. Doing it this way makes it much more tolerant of flex and vibration, and provides a better overall seal. Dipstick slides into the inner O-ring portion, transmission protrusion mates to the other inner O-ring, and then the outer O-ring and lip provide sealing to the body and splash protection. It’s actually a really brilliant design and I love it. (It also makes it possible to have a dipstick or use a sensor without a housing change, and switch between the two at leisure.) But if somebody at the factory was inserting it at an angle? They could easily tear it, causing a significant leak. Which, yes, speaking from experience. It’s such a known problem that of course The Purple Scam Artists sell an overblown, unnecessary part using the most bombastic language, like telling you every 68RFE owner’s truck has burned down. (No.)
On the plus side, if it is that, it really is an easy fix. It’s a single simple rubber part and it’s not backordered. Which is the most unbelievable part of it by far. But this assumes mechanical error, mind. The only other time these spew fluid out the dipstick, is when you’ve quite literally boiled the ATF or fried a clutchpack so badly – both of which are mandatory full reman events. The ‘pressure warning may indicate’ has me thinking bad seal though, because the transducer is nearby in circuit and would likely see a pressure drop from a bad seal leak. I mean, mine did.
I do still wonder what the liability will look like when a kid gets hurt crashing one and there is no proof of parental consent to whatever liability waiver I skipped through to try one out. While the parent is largely responsible for their kid’s phone use, it doesn’t seem like these companies put many safeguards in place to prevent misuse, and that might come back to bite them.
That’s the direct opposite of what happens in many EU countries where they actually care about the employees, are unionized, pay them decently, hold companies accountable for emissions and pollution and the unions have a real say in how things are run.
In the end its all about the money and if the product can be made cheaper and with less “stuff” to get in the way? That is where the factories get setup.
So, Ram is emulating their Italian owners vehicles as well?
I’m at work, so I’m afraid the answer could get me in trouble with HR.
Both times the same couple rode by in an improbable show of sitcom reality.
lmao
Have you ever used a scooter rental service? What was your experience?
My experience was everyone getting mad at the damn things being left in the sidewalk, in the road, wherever. After a while they sort of disappeared. I assumed they all got thrown into rivers by fed-up locals but it looks like the companies are still around.
I suppose the exclusion zone is a good idea, but in my case it encompassed my destination so we ended up dumping our scooters in a big pile of scooters on a narrow-ish sidewalk right at the edge of the zone.
They did get us (most of the way) to our destination, but I can’t say they did so with any great deal of comfort or convenience.
Oh, another fun thing: A cop stopped and told us to get out of the street and use the sidewalk. First time I’ve ever heard of someone being told to ride on a sidewalk. In my experience most communities are militant about not taking bikes on sidewalks. We had two bikes and two scooters in our group, so this isn’t a scooter-specific thing either.
In a stunning twist it was a dilapidated VW Bus! Maybe throw a decoy Smart in there. lol
There are ways around the age limit, and many people do that. But it’s a major pain.
Also for groups, you can spend several dollars of rental time just getting a scooter for each person in your group. At one spot where they were scarce, I had over $10 in charges on mine by the time everyone was checked in and mounted up. A taxi would have cost about the same.
For adults who use them occasionally, those who can afford the relatively high cost of renting them often, or those on a subscription discount plan, they’re pretty close to ideal for solo or two at a time transport in fair weather. But if you’re outside any of those, the disadvantages add up quickly.
I still like them a lot. But I wish they had 10 inch or larger spoked bicycle wheels instead. Those little tires don’t ride very smoothly or stable over any but the best surfaces. Most of the time, an e-bike rental is a better choice.
Hard to go after fictional people and minors, especially for a very small amount each. Ends up costing you more to try to recover the money than it does to write it off.
That said, the whole model is pretty much destined to be unprofitable. The only way they could really hope to make money was a lot of large contracts with cities, and they didn’t really get cities excited to subsidize this whole thing.
