Dyson Abandons the Electric Car, Calls EVs "Unprofitable"

Dyson Abandons the Electric Car, Calls EVs "Unprofitable"

Founder and CEO Sir James Dyson recently put the kibosh on his company's electric vehicle plans.

Well, that’s discouraging. Not that creating an electric car division from thin air isn’t difficult. It is. Tremendously so. But if one of the world’s consumer juggernauts says that EVs aren’t profitable – regardless of prior experience – that’s a gut punch.

Dyson found its niche with premium vacuum cleaner and household appliances, so when the British titan announced ongoing plans for an EV in 2017, it got mixed feedback. The car business is brutal to newcomers – Apple recently scaled their automotive ambitions when its ambitions met cold, hard reality – and even established veterans operate on razor-thin margins (and a huge portion of the American auto industry famously combusted or went bankrupt within the last decade).

Meanwhile, Tesla – helmed by billionaire Elon Musk – has yet to turn in a profit, and the outlook is far from rosy for anyone trying to break into this industry.

Still, as Wired pointed out at the time, Dyson had three distinct legs up on the competition. For one, they purchased Sakti3, which specializes in solid-state batteries, back in 2015. They also have vast experience with electric motors, and Dyson already puts serious effort into managing efficient air flow (for obvious reasons).

Inventor and founder Sir James Dyson announced plans to invest $2.7 billion to build a zero-emission EV by 2020, and critics were cautiously optimistic.

"Dyson can use the premium image of its vacuum products and design experience,” said Arthur Wheaton, an auto industry expert at Cornell University. “They do have a chance to be a niche player, like Tesla was at the beginning, but man, that’s a steep hill to climb.”

And, well, that hill might’ve been a tad insurmountable.

Wired reports that industry bigwigs like Volkswagen, Daimler, General Motors, and Honda will invest $300 billion in EV technology over the next 5-10 years, and because of that initial outlay, automakers could lose $60 billion in pre-tax profits through 2023. Not surprisingly, a company whose core competency is household appliances might not be able to manage such initial (if temporary) losses.

We’d previously reported that Dyson was moving its headquarters from Britain to Singapore – clearly a cost-saving measure – but that obviously wasn’t enough.

Read more about this announcement here: https://www.wired.com/story/dyson-sucks-air-out-electric-car-dreams/?bxid=5cc9e1242ddf9c1a7ade217e&cndid=52379958