AD #3390 – China EV Startups Struggle to Make a Profit; Scout Production Starts in 2026; Big Tires Hurt EV Range

This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.

SCOUT PRODUCTION STARTS IN 2026
Back in May, Volkswagen publicly announced it will bring back the Scout brand as a lineup of electric trucks and SUVs. Sources at Navistar, which owned the Scout brand, tell Autoline that VW actually started working on the Scout program last year. Autoforecast Solutions reports that the Scout SUV and pickup will go into production in Chattanooga, Tennessee in 2026. So we’ve got almost a 4 year wait before we see the first one.

VW TO GET EV RAW MATERIALS FROM CANADIAN MINES
Automakers are scrambling to lock up the raw materials they need to make batteries for electric vehicles and Volkswagen is taking it to the next level. It’s not just directly buying raw materials from mines, it’s buying the mines itself. VW is taking stakes in Canadian mines and mine operators to get the raw materials it needs. Why Canada? Because Canada has pretty much all the raw materials needed to make EV batteries and electric motors.

MORE EV STARTUPS IN CHINA
There are so many EV startups in China, literally hundreds and hundreds of them, that it’s hard to keep track of them all. And it’s only getting more crowded. Reuters reports that a billionaire, Wang Junjin, who owns an airline, wants to start making EVs. Thanks to the booming EV market and plenty of government incentives, many Chinese companies with no automotive experience are making EVs. That includes the real estate company Evergrande, the search engine company Baidu and the smartphone company Xiaomi.

CHINA EV STARTUPS STRUGGLE TO MAKE A PROFIT
With so many players, the EV market in China is making it hard for automakers to make a profit. XPeng reports it delivered over 34,000 EVs in the second quarter, up 98%. It brought in revenue of $1.1 billion, up nearly 98%. But it had a net loss of over $400 million, which was 58% worse than last year. Remember, Tesla lost money for over a decade and was able to stay alive mainly because Elon Musk has a knack for raising vast amounts of money. Now the question is, can the Chinese EV startups hold on long enough before they can turn a profit? They are going to burn through piles of money before they turn the corner, and making a decent profit is going to be very difficult with so many players slicing up the market.

GENESIS TEASES INTERIOR OF BEV CONCEPT
Genesis revealed the interior of its long, swoopy BEV concept, the X Speedium Coupe. It features an upscale tan and black interior, but what we find interesting is that the color scheme on the drivers side is flipped compared to the rest of the car. It has a black seat, floor mat and armrest and a tan colored seatbelt, while the rest of the seats are tan with black accents and have tan floor mats and armrests. Another interesting aspect is that the seatbelts go over both shoulders and latch in the middle of the passenger’s waist and note how the soft lighting behind the armrests creates a floating effect. While the X Speedium Coupe may never make it to production, we expect to see aspects on future BEV models.

FORD LIGHTNING GETS FREE CHARGING
Free charging is a popular way to get customers into EVs and now we can add the F-150 Lightning to the list. Same as with the Mustang Mach-E, Ford is giving Lightning owners 250 kWh of free charging at Electrify America locations in the U.S. But that does not include the commercial version of the electric truck.

POLESTAR TO SUPPLY BOAT BATTERIES
Polestar is becoming a supplier of batteries and charging systems to another company, but it might surprise you who. They’re going to Candela, a Swedish marine company that will use the tech in its hydrofoil electric boat. Polestar says this is part of its plan to expand electric mobility beyond the automotive industry.

TOYOTA’S NEW SIENTA
Toyota has been selling a small van in Japan, called the Sienta, since 2003 and it just came out with an all-new model. It’s based on the same platform as the Yaris and features a 3-cylinder hybrid powertrain that drives either the front or all four wheels. While one of the main focuses of improving the 7-seater van was providing more interior space and comfort, Toyota also added more tech in the form of digital displays and increased ADAS performance. Pricing ranges from about $14,000 to $22,500.

LIMITED MERCEDES RACE CAR HAS BIG PRICE TAG
But now let’s move to the other end of the pricing spectrum. Mercedes is offering a limited edition of its AMG GT3 race car that will cost 625,000 euros. Because this model, which is limited to just 5 examples, is not FIA homologated, its output has been bumped up to 650 horsepower, about 100 more than the race car. It also features a unique exhaust system, a Bosch digital display, its own paint scheme and special interior accents.

CLIMATE CHANGE HURTS AUTO PRODUCTION
Supply chain issues have crippled auto production over the last year but there’s another threat the industry has to worry about… climate change. A drought and heat wave in China has dried up rivers with hydroelectric dams. That led to electricity cuts which forced several automakers to stop production, including VW, Toyota and battery maker CATL. Tesla and SAIC said if the electricity cuts continue it could make it hard to maintain production. Over in Europe, the Rhine River is so low due to drought that it’s disrupting shipments to plants. In Germany, BMW and Tesla are dealing with forest fires where their plants are located. Automotive assembly plants are very water-intensive, so as droughts become more common, we can expect more disruption.

FORD TO LAY OFF 3,000
Ford is going to lay off 3,000 white collar employees and contract workers, mostly in Michigan. CEO Jim Farley said the ICE side of the business, what the company calls Ford Blue, has to cut costs by $3 billion over the next three years. Getting rid of 3,000 employees will save about $450 million, so they have about another $2.5 billion to go. Ford is also focused on cutting warranty and recall costs to reach its cost cutting targets.

BIG TIRES HURT EV RANGE
Big tires look good on cars but in the case of EVs, it can really impact their range. A Lucid Air Dream Edition has an impressive 520-mile range when equipped with its standard tires. But Bloomberg reports with its optional larger wheels, its range drops to 481 miles. A Tesla Model S drops from 405 miles to 375 miles of range with larger tires. And a BMW i4 M50 with bigger tires only has 227 miles of range compared to 271 with standard tires. But the larger tires are popular with car buyers. 4 out of 5 Hyundai Ioniq 5 customers opt for the bigger wheels. 40% of VW ID.4 buyers choose the 20-inch tires instead of the 19-inch ones. And two-thirds of Polestar owners pick the larger tire option.

But that brings us to the end of today’s show. Thanks for joining us.