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Runtime: 10:03
0:00 German Automakers Expect U.S. Tariff Relief
1:10 Rare Earth Restrictions Could Stop India Car Production
2:02 Foxconn Announcing New Japanese Partner Soon
2:40 Chevy Leaving the Chinese Market
4:32 Tesla Starts Human-Less Test Drives
5:14 Toyota On Track to Meet Its EV Goals
6:03 1st EV Gets CATL’s Swappable Battery
6:51 Samsung & LG to Make LFP Batteries for GM
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This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
GERMAN AUTOMAKERS EXPECT U.S. TARIFF RELIEF
Executives from several German automakers have said they didn’t think U.S. tariffs would have a big impact on them and it’s unlikely they would say that without expecting some kind of relief. So, it’s not a total shock to see Reuters that reports BMW, Mercedes and Volkswagen are negotiating with the U.S. Department of Commerce over a possible trade deal. Sources say this would require the automakers to make more investments in the U.S., like adding new models and shifts at plants, but they would also get credits for any cars that they export out of the U.S., which they could use towards reducing the tariffs. BMW, for many years, has been the top U.S. auto exporter by volume, shipping nealy 225,000 vehicles worth more than $10 billion around the world last year. So, going after a trade deal that benefits exports could help out the German automakers more than it would another company.
RARE EARTH RESTRICTIONS COULD STOP INDIA CAR PRODUCTION
Car production in India could come to a screeching halt in the next few days because China is restricting exports of rare earth magnets. The China move is in response to Trump’s tariffs but they’re impacting automakers globally. In addition to electric motors, the magnets are needed for parts like power windows and speakers. And the Society of Indian Automobile Manufacturers, a group that represents automakers, is warning that inventories at parts suppliers will run out at the end of the month. Automakers are urging the Indian government to reach a deal with China, which controls 90% of global processing of rare earth magnets. So, that’s why if a deal can’t be reached, car production in India will soon come to a grinding halt.
FOXCONN ANNOUNCING NEW JAPANESE PARTNER SOON
Foxconn says its next Japanese partner is “almost ready to be” announced. Earlier this month it signed an understanding to supply Mitsubishi with an electric vehicle and now its Chairman says we’ll soon know what Japanese automaker it’s working with next. While he didn’t say who, we think it’s Nissan because Foxconn expressed interest in taking a stake in Nissan in the past, as well as Nissan’s new restructuring plan, which requires slashing billions of dollars of cost. Foxconn sees working with Japanese automakers as an opportunity to grow its EV business.
CHEVY LEAVING CHINESE MARKET
We’ve said it before, as recently as yesterday, and we’ll say it again. There’s too many car brands in China and some need to go. It looks like that’s about to happen, but it might be a brand you didn’t expect. CarNewsChina reports that Chevy has delayed all new projects indefinitely and any product currently on sale is headed for the end of production. In 2018, Chevy sold over 640,000 cars in China, but in the first quarter of this year it only sold a little over 5,300 cars, a drop of nearly 76% compared to a year ago. So, it’s easy to see why reports say Chevy is leaving the market. A general manager for parent company SAIC-GM called the story a fake rumor and said “we will not give up Chevrolet.” But sources say that really means ‘we will not give up on Chevrolet’s existing users.’
TESLA STARTS TESTING WITHOUT HUMAN DRIVERS
Elon Musk said that Tesla is going to launch its robotaxi service in Austin, Texas next month, Bloomberg claims the company is specifically aiming for June 12th, and now it’s finally getting to testing without a human driver in the driver’s seat. Musk says Tesla has been running self-driving Model Ys around public streets in Austin for the last several days, which he claims is a month ahead of schedule. The company is initially expected to have a fleet of 10-20 cars that will be monitored and sometimes operated remotely by humans. Elon also says that a self-driving Tesla will deliver itself to a customer for the first time next month.
TOYOTA ON TRACK TO MEET EV GOALS
Toyota has been criticized for appearing to drag its feet on the EV transition. Last year, it sold fewer than 30,000 BEVs in the U.S. But that could soon change. Bloomberg reports that Toyota will have 7 fully-electric models on sale by mid-2027, including Lexus. The brands currently have two EV models available, three more imported EVs go on sale in the coming months and next year, Toyota will produce two new EVs in the U.S. And if EV sales don’t grow as expected, Toyota says it will just export the models it builds in the U.S. And the new EVs put the automaker on track to reach its goal of offering an electrified version of every model it sells globally by the end of this year.
1ST EV GETS CATL’S SWAPPABLE BATTERY
The first EVs with CATL’s Choco swappable batteries were delivered to a taxi company in China. The vehicle is the Oshan 520 sedan from Changan, which recently delivered 1,000 examples for the taxi service. In addition to Changan, automakers including GAC, FAW, SAIC, BAIC, SAIC-GM-Wuling and Nio, have all signed up to use CATL’s swappable batteries. The battery maker has opened 34 locations in Chongqing, the first city to adopt the swap stations and 16 more will open in the city by the end of the year. Each station can store up to 30 batteries and they can be swapped in just 100 seconds.
SAMSUNG & LG TO MAKE LFP BATTERIES FOR GM
And speaking of batteries, the Korea Economic Daily reports that Samsung SDI and LG Energy Solution are going to build LFP batteries in the U.S. for General Motors. The two battery makers currently produce NMC or Nickel-Manganese-Cobalt packs for GM. Samsung will retrofit its plant in Indiana to produce LFP batteries starting in 2027 and LG Energy will convert production lines at its plants in Tennessee and Ohio. The plants currently make pouch NMC batteries but GM is considering switching to prismatic cells, which are structurally better for LFP batteries. The change is part of GM’s strategy to offer more affordable EVs. And according to industry estimates, LFP batteries cut costs 20-30% or around $6,000 per vehicle compared to NMC batteries.
And a quick reminder to tune into Autoline After Hours today. We’ll have Warren Browne of RFQ Insights and Joe White of the High Speed Rodeo to talk about tariff impact on U.S. production, employment, prices, sales and what plants are at risk of closing down. Plus, much more. So, join John and Gary when the show goes live at 3PM EST.
But that brings us to the end of today’s show. And I hope to see you later today.
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Sean, Here are a couple of questions I am interested in that you may have answers to. I agree that Nissan is likely the next Foxconn partner, but does that mean that Renault and possibly Dacia could get those models as well? I understand why Chevy would stop producing cars based on US models in China, but wouldn’t the name be valuable to use on a Chinese designed, Chinese produced model? Also, can we assume that Buick will continue in China? On a different note, I keep seeing Youtube info about a Ford Transit Courier based pickup truck called the Ranchero that be a low priced base model below the Maverick. Presumably, it would be made in Turkey., which is not part of the EU. Do you know how much, if any, tariff there is on Turkish goods?
A court ruled against the legality of Trump’s tariffs. Time will tell what actually happens. The ruling is being appealed, and whatever happens with the appeals, Trump tends to ignore court orders. We shall see.
https://www.yahoo.com/news/know-trade-court-rules-against-074147683.html
In a more recent Tesla announcement that did not make the cut for today’s show, Musk promised that in the future, when hooligans attempt to vandalize Tesla dealerships in any way, the alarm will signal a humanoid robot, which will deliver itself to the location and proceed to beat the living daylights off these savages. Kevin A, you have been warned!
`It is by now obvious that most of the tariffs will be substantially lowered (which was obviously the plan all along) after bilateral negotiations with each nation and many times with individual companies, and will result in huge amounts of investment, job creation AND additional tax revenue by the new workers AND much less government expense to pay unemployment to said workers, and in most cases these will be very well paying, very satisfying NON UAW jobs, as the D3 are incapable of making any product (practically) as desirable in Europe as German luxury and sports cars are in the USA.
But these speculations pale in comparison to the news of the last two weeks, shocking yet obvious to many of us, which was the DISGRacEFUL coverup of Biden’s senility and mental deterioration by both his WH staff and family, his dogs in the Dem Congress who lied shamelessly about his alleged fitness, And OF COURSE 95 % of the corrupt media, who parroted the Dem party line. ANd it is AMAZING that a recent book documenting the above by.that despicable…JAKE TAPPER, the worst of the coverup artists, now has the audacity to… tell us about it!
Regulus, Trump has displayed a lot of “senility,” in addition to his being a vile, evil person. His cult members are, of course, not going to say anything about it.
As far as “negotiations” with Trump, they mean nothing, as demonstrated by NAFTA 2.0, AKA USMCA.
Also, governments will be paying more, not less unemployment benefits, as our fool-in-chief crashes the economy.
Regulus,,
You demonstrate the essential difference between Canadians and Americans. A Canadian would never threaten an American. We are too polite. Americans think that threatening people makes them sound powerful, when it only makes them looks stupid. Normally, a Canadian wouldn’t bother pointing that out, since Americans like you are not capable of understanding it anyway. Some the other blog followers will understand though.
Can individual companies like BMW negotiate tariff deals? Wouldn’t the German government have to do that? Seems like a legal issue for them in ze fazerland to conduct their own foreign trade policy.
Whatever happens, hopefully VW gets left out and burns to the ground in an epic global bankruptcy.
I listened to yesterday’s new AAH, and it was an excellent show. THe reason, of course, was all in the guests, both of whom were excellent.
John and Gary are the constants, in almost every show, but there is little they can do when the guests are really weak, as in some previous shows, some of whom have prompted some members to complain and say they would cancel their membership if that trend continued.