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Runtime: 12:04
0:00 VW Partners with Another Chinese Automaker
1:11 Renault Reveals Geely-Based Grand Koleos
1:58 Mercedes Spends More on ICEs Than Planned
2:34 Little Growth for Western Automakers in China
3:13 Big Incentives Boost EV Sales
4:42 Rimac Creates New AV Company Called Verne
5:28 Volvo Delays EX30 in the U.S.
6:17 Car Payments Up Nearly 20% in 2 Years
7:14 Hyundai Shows Sub-25,000 Euro Inster
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This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
VW PARTNERS WITH ANOTHER CHINESE AUTOMAKER
Volkswagen is teaming up with yet another automaker. You already know about the joint venture it announced with Rivian and the partnership it has with XPeng. Now it’s going to work with SAIC on jointly developing BEVs and PHEVs that will hit the Chinese market in 2026. While GM’s joint venture with SAIC might be more well known, VW and SAIC formed one of the earliest JVs in China. Audi also announced a partnership with the Chinese automaker last month, which will see its first vehicle launch next year. VW has been steadily losing market share in China and was overtaken by BYD as best-selling car brand in the country for the first time in 15 years. Its vehicles developed in Germany, especially electrics, have not been as popular with Chinese customers, so it hopes to come out with more attractive products that were developed in China with local partners.
RENAULT SHOWS GEELY-BASED GRAND KOLEOS
Speaking of partnerships, Renault is seeing some of the first benefits from its tie-up with Geely, to develop IC powertrains. That includes a new model that just debuted at the Busan auto show called the Grand Koleos. It’s based on the CMA platform, which is used by many Geely brands, and it looks very similar to a model that the Chinese automaker already has on sale called the Monjaro. The Grand Koleos wears a badge that says “E-Tech Hybrid” and currently all of Renault’s E-Tech Hybrids are full hybrids, so no 48-volt stuff and no charging plugs. And presumably it will use a powertrain from its ICE JV with Geely, called Horse.
MERCEDES SPENDS MORE ON ICEs THAN PLANNED
And in other ICE news, Mercedes is spending more money on combustion engines than it planned to, including $15 billion this year on its passenger cars. CEO Ola Kaellenius said that if Mercedes didn’t keep its engines at “the very highest technological level” then its ICE sales would start to stall around 2027 or 2028. And Mercedes still expects 50% of its sales to come from combustion engine vehicles.
LITTLE GROWTH FOR WESTERN AUTOMAKERS IN CHINA
Alix Partners doesn’t see much growth for non-Chinese automakers in China. By 2030 it forecasts that China-brand NEVs will have 72% of the EV market, so foreign brands only get the remaining 28%. It also says foreign automakers will have to compete directly with Chinese automakers in every market of the world, except for the U.S. and possibly Canada, which are trying to block them through tariffs. But Chinese automakers are building assembly plants in many different countries, which could protect them against those tariffs.
BIG INCENTIVES BOOST EV SALES
The EV segment is growing in the U.S. despite Tesla’s falling sales. According to S&P Global Mobility, new EV registrations were up 14% in April, while Tesla’s were down 17%. If you exclude Tesla, EV registrations shot up 69%. Ford was number 2 in April with more than 8,300 EV registrations, up a whopping 169% compared to a year ago. Hyundai was number 3 with 6,355 registrations and Kia was about 1,000 behind in fourth place. BEV market share in the U.S. reached 7.4% in April, up slightly from 7% a year ago. And while the traditional automakers had a great month in April, they had to rely heavily on incentives to boost sales. They were nearly $11,000 for the Toyota bz4X, $9,000 for the Ford Mach-E and a whopping nearly $17,000 in incentives for the Nissan Ariya.
RIMAC CREATES NEW AV COMPANY CALLED VERNE
Mate Rimac, the guy who founded super high-end sports car company Rimac, and two of his colleagues have launched a new autonomous ride-hailing company called Verne. The Level 4 autonomous vehicle gets its sensing package from Mobileye and is based on a new platform that it says is free from the compromises and disadvantages of a legacy platform built for human driving. Despite only having two seats, it claims the vehicles will have more interior space and comfort than the best limousines today and services that can be tailored to each user, like interior scents and temperature. Verne will first launch its ride-hailing app in 2026 in Croatia, the home of Rimac.
VOLVO DELAYS EX30 IN THE U.S.
Well, just as we suspected, Volvo’s EX30 will not hit the American market until probably next year. The EX30 is made in China so it’s included in President Biden’s 100% tariff on any electric car made in China. What’s more, the European Union is looking at boosting tariffs on Chinese EVs, so Volvo will start building the EX30 at its plant in Ghent, Belgium for both the U.S. and EU markets. The delay will hurt Volvo because the little crossover would be priced at $36,000 in the U.S. market, not including any incentives, and was facing very little competition. But a year’s delay or more will likely see a higher price, and a lot more competitors.
CAR PAYMENTS UP NEARLY 20% IN 2 YEARS
Car payments in the U.S. have increased so much in the last two years that more owners can’t afford them. According to TransUnion, monthly car payments in the first quarter of 2022 were $512 on average but that rose to $581 in Q1 of this year, a gain of nearly 20%. And payments are about $830 more a year on average. Because of that, delinquencies on loans reached Great Recession levels. Loan delinquencies of 60 days past due were 1.19% in the first quarter of 2023 and in Q1 of this year it increased to 1.33%. TransUnion says delinquencies are up because savings fell and car payments outpaced inflation and income growth.
HYUNDAI REVEALS SUB-25,000 EURO INSTER
Earlier this month, Hyundai teased a new compact EV called the Inster. And now it made its world debut at the Busan auto show in South Korea. It comes standard witha 71-kW electric motor and a 42-kWh battery, which provides a range of more than 300 kilometers or 186 miles based on the WLTP cycle. It’s also available with a more powerful 84.5-kW motor and a larger 49-kWh battery that has a projected range of 355 miles or 220 miles. The model is an evolution of Hyundai’s gas-powered Casper that’s sold in Korea. But the Inster’s body and wheelbase were extended to give it more interior space and probably make room for the battery pack. Inside it features dual 10 and a quarter inch digital screens. The Inster will first launch in Korea this summer followed by Europe, the Middle East and Asia. And Hyundai is promising to keep its price below 25,000 euros.
We’ve got a great Autoline After Hours coming later today that will be especially interesting for all you engineers who do chassis and powertrain calibration. ZF, a sponsor of this show, has a tool called cubiX for smart cars that allows you to tune the suspension, steering, brakes, traction and other features while sitting in the passenger seat with a laptop. No more crates full of springs, shocks and bushings that you’ve got to spend weeks or months sorting through to find the best combination. It’s a real eye opener if you haven’t seen it. Journalist Lindsay Brooke will also be on the show, so join John and Gary when it all goes live at 3pm eastern time on the Autoline website and YouTube channel.
A programming note here. We’ll be taking a midsummer break next week and so there won’t be any Autoline Daily’s or After Hours. But keep an eye out. We’ll be posting some videos we think you might be interested in, including Caresoft’s insights into Tesla’s 48 volt architecture, and a battery breakthrough from a company called Natrion that can convert any battery into a solid state one, with no factory changes. It’s literally a drop-in solution. Anyway, keep an eye out for those and we’ll see you back here again the week after next.
Thanks to our partner for embedding Autoline Daily on its website: WardsAuto.com
@Autoline Team: are the incentives for EVs like the $17,000 in incentives for the Nissan Ariya government incentives or OEM incentives?
When looking at the BYD and SAIC models they seem to be more youthful inspired and willing to push the design envelope a bit. The Chinese appear to really like the personalization and customization of their cars while VW is about as conservative as a three-piece suit at a pool party. I can see why VW is partnering with SAIC.
“Little Growth for Western Automakers in China”, I’d say that it’s pretty safe to assume little growth for anyone willing to import into China. They’ve figured out how to make vehicles and can do it cheaper than most anyone else so trying to compete domestically would be hard enough. Competing on their shores, you might as well throw money away.
Car payments up 20% in 2 years. along with groceries, gas, homes, utilities and fast food. Good job administration. But people must love it because some want 4 more years of it.
VW has had their partnership with SIAC for 40 years. It is nothing new.
Yes, gas prices are higher than in 2020, when driving was down about 30-40%, and crude oil had negative value.
Car payments up, partly because of higher, but still low interest rates compared to when I bought my first house. Also, “cars,” are increasingly becoming expensive trucks and SUVs, with more of them from premium brands. When you buy a more expensive vehicle with a loan, the payment will be higher.
Maybe Mercedes and BMW should jointly develop ICE engines, or maybe just sell them to each other. BMW seems to have the best 2.0 turbo, based on performance and efficiency. Would they sell them to Mercedes? Yeah, powertrain, especially engines, have a very high NIH factor. Transmissions, less so, seeing that GM and Ford jointly developed that 10-speed, but I doubt we’ll see Chevy V8s in F150s any time soon. Also, everyone from Jeep to Rolls-Royce uses a version of the 8-speed ZF, some made by ZF, and some under license.
@Lambo
The Chinese EVs have a modernistic designs which apparently are liked by Chinese buyers. VW EVs have a bland look.
All non-Chinese OEMs are going to get a rude awakening IMHO. I just saw John McElroy’s post on LinkedIn about a 30% cost advantage of Chinese OEMs and suppliers. I will read it soonest.
This is not based on polls but just on my own small world: to me it seems that many people are critical of both candidates. Consider them too old and unstable to function for another four years.
Both have overspent. $26 trillion of our expected year-end debt of $36 trillion has been racked up by our two candidates. The current President will have caused $8 trillion by the end of the year, just like the previous one. After the $10 trillion in eight years by the Obama/Biden administration. How we can’t get behind younger and better candidates is a mystery to me.
In inflation is a significant difference: an expected cumulative 18% by year-end in four years by the current Prez versus 8% under the previous one.
Stock market: the same 40% up in four years under current and previous Prez, provided it will not go down until the end of the year, which is possible of course.
Illegal immigration: hard to tell because we can’t know the real number of people who have successfully evaded our systems. The most cited number is the number of arrests. Many people call it a shame when those numbers go up. To me it seems that it is good when the number of arrests goes up. Most important is what happens next. I tend to believe the previous Prez’s estimate of 15-20 million illegals. Whether those can be found and expelled: I doubt it.
So the only real factual difference is 10 percentage points of cumulative inflation between the two candidates. Other than that I would call them equally mediocre and I doubt that either one of them can function for four years in this top job.
Agreed Lambo. VW does not understand the Chinese market and thus their decline. They technically don’t really understand the US market either. They feel that whatever works in Germany works in the world which is not true. The Chinese market is looking for a tech focused car with things like augmented reality and in car apps. They really do not care so much about driving dynamics as most of these cars are used in the city. All it needs to be is cheap, reliable, reasonably stylish, reasonably comfortable, and very high on tech features. They like things such as the goofy AI assistant that swivels and makes stupid faces at the drivers and passengers as it steals all your personal data. That is not something a German automaker can understand at all. All that to say, partnering with a local china company on software and goofy tech gimmicks is not a bad thing for VW. They do like VW from the perspective of reliability as compared to the traditional Chinese OEM brands though.
Wim- I have to agree that in a country of 300+ million people we have to choose between two old white guys and don’t even get the option for a decent selection. I believe the general public is pretty well fed up with the group that can’t seem to manage a federal budget when it’s our money, yet somehow become millionaires in two years with their own money.
The mandating of electrification is just another policy that will cost us all more money in the end. And yes when you pay more with higher interest rates the payment goes up. For those that are unaware of the obvious. It is the reasons that interest rates are up and price of everything that is the problem.
BTW Kit gas prices are double what they were in 2018 well before CV and driving was down. So nice try making an excuse for the poor policies that have driven up the prices.
@Lambo: yes, that sums it up.
We are talking global car lovers here. Please keep US politics out of it. Thanks
I’ll just mention that for me the difference between the two candidates can be summed up as follows: the current one has taken 40% of his time in office on vacation, drawing full salary, with wars around the world that we are now directly involved in, I feel partially due to a perceived weakness of the US.
The previous one donated his entire salary for 4 years to a variety of causes/programs including the veterans administration and national parks service (which was never acknowledged by the press) with NO wars and a position of strength and negotiation in the world.
The reason I mention all this in an automotive forum is that large ticket purchases like vehicles are partially based on emotion and if a population feels secure and that things are headed in the right direction they are more likely to participate/purchase in this industry that we love.
Why is it that it is always the MAGATs that can’t keep their political opinions to themselves in an automotive forum? Are they just trying to justify their belief in a sociopath, or do they really think we want to know their opinions on such things? Please MAGATs, enlighten us with which one it is.
Lambo, gas was $2.89 in Indiana in summer of 2018. I bought gas a couple days ago for $3.35. Two times 2.89 is $5.78, not $3.35.
To me, it is a big problem that one of the old white guys sucks up to nearly every despot in the world, Putin, Kim, Orban, and others.
As far as the deficit, the Trump/Ryan tax cuts for the rich didn’t help. Yeah, there’s been too much spending too.
I guess European inflation over the past couple of years must be due to the current American administration too? Even Switzerland has been significantly hit, despite lower interest rates and a strong currency. Incidentally, chocolate has been getting more expensive because growers in Africa must now contend with significantly worse climactic conditions.
And while I think the reinstated incentives for EVs are really on the high side, and don’t support government selecting for specific technologies, the administration’s energy policies have resulted in very high investments by private industry. New factories have been going up especially in ‘red’ states, and that’s significant for electric mobility too.
As for ‘no wars’, that’s baloney, be it with American involvement in Syria, or without all over. The US-centric view can be taken too far, especially when by sensible measures, China is now the world’s largest economy.
Don Putin tried to take over Ukraine in a coup-de-main (there’s been a war there since 2014) because when Zelenskyi was elected (modern Ukraine’s 7th President), he seemed like a weak choice easily influenced/corrupted, which is the Kremlin crime syndicate’s playbook.
That did not work, and hence, the disastrously ill-informed attempt to replace him and return the country to a vassal state. When Ukraine, Europe’s largest country, is actually far older than Muscovy. Re-reading Anna Politkovskaya’s ‘Russian Diary’ was interesting, and Putin has very clearly stated his ideas for Europe and the free world in general too.
Lastly, I can’t vote for a traitor still attempting to undermine our foundational method of conferring legimitacy on government, and directly attacking the work of citizens who have time and again enabled voting to proceed as per the rules. Never mind how someone like Brad Raffensperger (GA) gets no real support from his own party (erstwhile ‘Republicans’) in this vital matter.
Merv & Ziggy- Yes this is an automotive forum and a global one at that. A huge part of automotive sale worldwide is directly tied to the economy of each country. It makes a difference in GDP where factories will be built and how many vehicles will be sold. Sorry but they are tied together, and I know that politics are like religion and no matter what is stated even with facts is not likely to sway anyone to think differently. That doesn’t mean people don’t have opinions on the matter. When voiced with respect I see no problem with the subject. Are we not adults that can discuss differing opinions? No different if someone would say that car is extremely ugly. I don’t have to agree with them and nor and I going to try and sway them to think otherwise.
The problem with the current US politics is not supporting one guy automatically makes people assume you support the other guy. After last night’s debate and the ridiculous pissing match over who can drive a golf ball further has really set the bar pretty low. I never knew that was ever an attribute of a good president. So, although I am critical of Biden its completely based on his poor performance and the state of where I see the country currently. Not to be taken as support for anyone else. You may not agree and that’s okay. If that upsets, you I think that’s a you problem. We shouldn’t shy away from having discussions just because it makes you uncomfortable. What I find amazing is any criticism of Biden isn’t met with factual defense of positive things he has done but comparisons of him to Trump. I don’t care about what Trump did or didn’t do. It’s about his performance. How about listing the good things he has done to garner support. Which is why this election seems to have become a choice of picking between the guy who isn’t the worse and not who is the best.