AD #4148 – German EV Sales Surge w/out Subsidies; U.S. DoE Invests in Lithium Mine; BMW Runs Hydrogen Pipeline into Assembly Plant

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

Yesterday was the end of the third quarter, and in about another two days we’ll have a pretty good picture of how car sales are doing in the U.S. market. A lot of automakers only report sales on a quarterly basis so we’ll finally get the data we need to figure out what’s going on. But here’s what we know so far.

U.S. EV SALES SURGE AHEAD OF SUBSIDY WIPEOUT
Cox Automotive is forecasting that automakers sold over 1.26 million vehicles in September, up 6% from a year ago. A key reason for the healthy market was a big surge in EV sales as customers rushed to buy an electric car before the $7,500 federal subsidy got yanked. Cox estimates that consumers bought 410,000 EVs, up more than 20% from a year ago, and probably hitting close to 10% market share.   

FARLEY SAYS EV SALES WILL DROP 50%
As we reported yesterday, at least one automaker, Lucid, will pay for its own $7,500 discount, while General Motors and Ford figured out a clever workaround. Yesterday, they made down payments on the EVs their dealers already have on their lots, and now those cars can be leased with the $7,500 discount already factored into them. But make no mistake about it. Everyone now expects EV sales to plummet. Ford CEO Jim Farley says he won’t be surprised to see them drop to 5% market share. 

  

GERMAN EV SALES SURGE W/OUT SUBSIDIES
Here’s our Autoline Insight. When Germany yanked its EV subsidies at the end of 2023, sales fell off a cliff. They dropped by more than 143,000 units, or down 27%. But guess what? Over the last year and a half, sales came roaring back. EV sales in Germany are up more than 39% this year through August, and are on track to almost hit where they were before the subsidies went away. And it happened because automakers came out with better EVs with more competitive prices. That’s a very likely scenario of what’s going to happen in the American market. Give it a couple of years, and EV sales have a good chance of recapturing all their lost market share.

GERMANY EV SALES
2022	470,559
2023	524,219
2024	380,609
2025 (J-A)	336,707
Source: ACEA

U.S. DOE INVESTS IN LITHIUM MINE, PROCESSING
It’s highly unusual to see the U.S. government actually invest in private companies. But the Department of Energy is taking a 5% stake in Lithium Americas and a 5% stake in its Thacker Pass joint venture in Nevada with General Motors. Lithium Americas says it finalized a deal with the DOE to unlock the first $435 million from a previously announced $2.26 billion loan for its Thacker Pass project. Once complete, Thacker Pass will be the largest source of battery lithium in the Western Hemisphere. GM invested $625 million in the mine last year and has the rights to buy all the project’s lithium from its first phase, which is expected to be enough for 800,000 EVs. The deal also allows GM to buy a portion of the output from its second phase for 20 years. The new DOE deal is part of an effort by the Trump Administration to invest in private sector companies seen as vital to national security. It has also taken stakes in Intel and MP Materials.

FORD TOPS EV SALES IN CANADA
Ford was the top seller of electrified vehicles in Canada through the second quarter of this year. Since 2022 it has doubled its market share of hybrid, PHEV and pure electric vehicles to just under 13%. According to data from S&P Global, Chevy is in second at 9.7% market share, followed by Kia at 9.5%, then Toyota at 9.3% and rounding out the top 5 at 8.7% is Hyundai. Despite including hybrids, Tesla used to dominate EV market share in Canada. In 2022, it sat at nearly 47%, but that’s now dropped to 7.8%. The company was already losing ground to better competition, but Elon Musk’s involvement in the Trump Administration and comments made about the country have really ramped up that decline. As a result, the entire BEV segment in Canada has suffered. In the 4th quarter of last year, market share sat around 15%, but in Q2 of this year it came in just under 6%.

FRANCE INCENTIVIZES NON-CHINESE EVs
Through August of this year, Chinese automakers have sold over 430,000 vehicles in Europe, an increase of 74% compared to the same period last year. And they’re doing that in a market that hasn’t grown much, meaning European automakers are losing market share. This is why the EU slapped import tariffs on Chinese-made EVs and now we’re seeing individual countries offer incentives for locally produced models. France introduced EV bonuses that basically block any vehicle made in China from getting them based on environmental criteria. Automotive News reports that France is now considering boosting that bonus if the battery is made in Europe. The U.K. is also launching a similar Electric Car Grant and Italy and Spain are both looking into it. While these moves have limited Chinese EVs, the tariffs don’t apply to hybrids and EREVs, so that’s what Chinese automakers have turned to and that’s what’s driving their growth in Europe right now. We believe if this growth leads to more layoffs in the region, Europe could decide it needs tariffs on all Chinese imports, not just electric cars.

    

QUANTUMSCAPE & CORNING PARTNER FOR SOLID STATE BATTERIES
Solid-state battery maker QuantumScape is partnering with materials company Corning to jointly develop high-volume ceramic separator manufacturing capabilities for solid-state batteries. Corning is a world leader in glass, ceramics and materials science, and will work with QuantumScape to develop ceramic separators for solid state batteries, which offer longer range, faster charging and are safer compared to conventional lithium-ion batteries.

ZOOX ROBOTAXIS HEADED FOR WASHINGTON DC
It seems like every week we report about robotaxis expanding into new markets and today is no different. Autonomous startup Zoox, which is owned by Amazon, announced it will start testing its vehicles in Washington DC. It will first map the city with retrofitted SUVs with safety drivers, before progressing to autonomous testing later this year. Zoox is now testing autonomous vehicles in San Francisco, Las Vegas, Seattle, Austin, Miami, Los Angeles and Atlanta. And last month in Las Vegas, Zoox became the first company to offer fully-driverless rides in a purpose-built robotaxi.

WERIDE & UBER PARTNER IN ABU DHABI
And speaking of robotaxis, Chinese autonomous driving startup WeRide announced that its robotaxi fleet in Abu Dhabi is now available through the new “Autonomous” category on Uber’s app. WeRide says that since the app was launched, weekly orders have risen around 20%.

BMW RUNS HYDROGEN PIPELINE INTO ASSEMBLY PLANT
BMW is so committed to reducing greenhouse gas emissions in its manufacturing operations that it’s going to run a hydrogen pipeline directly into one of its assembly plants in Germany. The hydrogen will be used as a fuel to bake the paint on BMW 1 and 2-series and the Mini Countryman. It will also be used for fuel-cell powered fork lifts, tug trucks and logistics vehicles in the plant. The hydrogen pipeline will be about 2 kilometers long and is expected to be completed in mid-2027. 

AAH: CARBON CAPTURE FOR IC ENGINES
Don’t forget that tomorrow’s After Hours will be about carbon capture for internal combustion engines. We’ve got Yabs Kebede, the director of engineering from a company called Remora coming on the show, and I think you’ll be fascinated with their technology. 

And that’s it for today’s report, thanks to all our members for your support, and thanks to all of you for watching Autoline Daily.