AD #4297 – Honda Plans 15 New Hybrids; Hyundai Talks Breaking Down Silos; AI Could Extend EV Battery Life

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

HONDA PLANS 15 NEW HYBRIDS
A poor performance in its most recent fiscal year, fueled by massive EV writeoffs, is going to cost Honda CEO Toshihiro Mibe some of his influence over the company. For the first time since going public in 1957 Honda posted an operating loss, a $2.6 billion deficit for the fiscal year, which ended in March. That’s a huge drop from last year’s operating profit of $7.6 billion and can almost entirely be blamed on the company writing off nearly $10 billion in EV-related investments. CEO Mibe is no longer listed as the Chairperson of the Board of Directors. That title has now been transferred over to one of the other directors, which we think is a result of Honda’s financial performance. But maybe there’s a chance he can earn the position back? The company laid out a new 3-year plan that it thinks will return its automobile business to profitability. It will invest nearly $40 billion over the next 3 years into gas, hybrid and electric vehicles as well as software. However, the vast majority, almost $30 billion, will go towards producing more gas and hybrid vehicles. By the end of the decade Honda plans to launch 15 next-gen hybrid models, mostly in North America, and will also get into larger hybrid vehicles. It previewed two of those 15 models with a new Honda sedan and an Acura SUV prototype, which will ride on a new platform with a next-gen hybrid system and a newly-developed AWD unit.

WERIDE POSTS GROSS PROFIT IN Q1
Robotaxi services continue to gain steam around the globe. Chinese autonomous vehicle company WeRide released its first quarter earnings and its revenue shot up 58% to $16.8 million. Its gross profit increased 56% to $5.8 million and its gross margin reached 35%. In the same period, WeRide’s number of registered robotaxi users in China nearly doubled compared to a year ago. And each robotaxi vehicle in its domestic fleet handled more than 17 orders per day on average, with peak daily volumes reaching 28 rides per vehicle. Globally, WeRide’s robotaxi fleet is nearly 1,300 vehicles and the company expects to deploy 200,000 autonomous driving vehicles, including robotaxis, over the next five years.

           

WAYMO EXPANDS FOOTPRINT BY 27%
Speaking of robotaxis, Waymo announced it will expand its services in Miami, Austin, Atlanta, Houston and the San Francisco Bay area, boosting its coverage to 1,400 square miles in 11 cities. That’s a 27% increase from its current footprint. Waymo now has a fleet of about 3,800 vehicles, providing around 500,000 paid trips a week and it’s targeting 1 million paid rides a week by the end of the year.

XIAOMI OPENS AI AV SYSTEM TO EVERYONE
And in one last bit of self-driving news, Chinese automaker Xiaomi introduced an open-source autonomous driving AI system that combines multiple models and reasoning within one framework, which it claims delivers stronger performance while also improving speed and accuracy. The company plans to fully open-source both the model and its underlying codebase, so developers and researchers can help advance autonomous driving with AI.

AI COULD ADD EV BATTERY LIFE
AI could potentially add years of life to an EV battery. Researchers at a technology university in Sweden developed a new AI-based charging method that optimizes the electrical current going into a battery during fast-charging sessions. They claim a battery can be fast charged an additional 703 full cycles with their technology, a nearly 23% increase. And this is definitely an area that automakers are looking into. We know the Hyundai Group has said it’s working on an AI-based battery management system for its next-gen EV architecture.

HYUNDAI TALKS ABOUT BREAKING DOWN SILOS
Almost all legacy automakers are organized in silos. Design, Engineering, Manufacturing, Purchasing, Sales, Marketing and Finance are organized into departments that typically don’t interact enough with each other. And that century-old business structure just isn’t competitive in today’s fast moving industry. So Ford and the Hyundai Group are reorganizing to break down the silos and move to cross-functional product teams. Hyundai’s Chairman Euisun Chung says that organizing into teams that are formed with people from different departments will help engineers understand what designers are envisioning, and sales people will provide faster feedback to product development.

MASSIVE CULTURAL SHIFT AT FORD
Meanwhile, have you seen the interview we posted with Ford’s Chief Operating Officer? We interviewed him to get a better understanding of Ford’s reorganization called Product Creation & Industrialization. And it’s about getting rid of the silos, too, because it’s a structure that moves too slow. Design hands off to Engineering, which hands off to Manufacturing, which hands off to Purhasing and so on and so on. Not any more, one unified team is responsible for a vehicle from the initial sketch until it rolls off the assembly line. It’s all about speed to market, quality control and cost reduction. Kumar Galhotra says Ford is still committed to EVs, but the new organization will develop vehicles that can pivot between ICE, Hybrids, and Extended-Range Electric based on market demand. The new organization is a massive cultural shift for Ford, but the COO says it’s necessary to compete with Tesla and Chinese OEMs. There’s a lot of great info in that interview, which is on the Autoline website and our YouTube channel.

FORD’S STOCK SHOOTS UP
By the way, the Autoline Stock Index shows that Ford’s stock was up more than 13% in pre-market trading. Investors really warmed up the idea of Ford creating an energy storage business, after Morgan Stanley put out a report saying Ford Energy could generate 25% gross margins and $346 million in EBIT earnings by 2028. The stock was trading at $13.57, giving the company a $54 billion market cap.

We’ve got a great Autoline After Hours coming up this afternoon. Joe Fadool, the CEO of Borg Warner, is our guest and we’ll get into everything from competing in China to the potential impact of humanoid robots. Chris Otts from the Wall Street Journal will also be on the show, so join John and Gary when we live at 3 pm eastern time.

But that’s a wrap for this show. Thanks for tuning in and I hope to see you later today.