AD #4353 – Chevrolet Gives Up in China; Hyundai Tests Electronics Before Building Cars; GM Sells Battery Shares to Samsung

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

CHINA SALES SINK AGAIN
Automotive experts in China forecast that new car sales would stop dropping and start climbing at this point in the year. But it’s not happening. Sales fell 21% last month to only 1.4 million new vehicles. I say “only” because sales in the U.S. last month were 1.3 million. It’s shocking that China’s domestic market has shrunk so much that it’s barely bigger than the U.S. market right now. Even sales of NEVs were down 4%. What’s keeping them from being down even more is exports. They shot up 88%, with over 900,000 cars and trucks heading to global markets.

CHEVROLET GIVES UP IN CHINA
Things are so tough in China that Chevrolet will stop selling cars there. But GM will continue to make Chevrolet models with SAIC and export them around the world, though not to the United States. GM and SAIC make 6 different models, including subcompact and compact cars as well as crossovers and a compact pickup.

 

WHAT, MERCEDES WITH MCDONALDS?
Just to give you an idea of how desperate Mercedes-Benz is to turn its sales around in China, it launched an ad campaign last fall with McDonalds. The ads feature a hamburger sliced into three parts to look like the Mercedes 3-pointed star. And they used the tagline “So Mc-Benz.” It was supposed to make the Mercedes brand appeal to young people since the average age of Benz buyers in China is only about 36 years old. But it didn’t work. Big Macs and Benz’s just don’t go together and Mercedes continued to see its sales drop.

BMW BOOSTS RECYCLING
With a few tweaks BMW says we can greatly increase the amount of materials that we get from vehicles that would otherwise be scrapped. Through a research project called Car2Car, it wanted to figure out the percentage of steel, aluminum, copper, plastic and glass from an end-of-life vehicle that can be recovered at high enough quality for reuse in new industrial applications. During a trial using current standards it was only able to recover 6% of the materials. But by improving pre-sorting, modifying the shredding process, using new classification, adding sensor-based sorting and more precise separation it increased its recovery rate to 51%. Steel, in particular, saw the biggest jump, going from 1% to 81%. Currently, impurities from cables, connectors and other components prevent scrapped vehicle steel from being recycled into high-quality automotive steel. But it developed a new sorting method that improves scrap quality enough that BMW used the steel to make 100,000 parts in a plant trial. It’s now filing an application for this process. However, BMW says there’s still significant challenges trying to recycle plastic and glass for automotive applications.

BOEING SELLS VTOL TECH TO ARCHER
We think VTOLs could be a big disrupter in the mobility sector, which is why we’re keeping an eye on that industry. And Archer Aviation, the electric VTOL startup, just signed a big deal with Boeing. Archer is acquiring three subsidiaries from Boeing that are developing unmanned and electric vertical takeoff and landing aircraft or eVTOLs. Archer says the deal will allow it to deliver an end-to-end AI platform for commercial aerospace, defense and air traffic management. Boeing will take a stake in Archer and will retain access to its autonomous flight technology.

GM SELLS BATTERY SHARES TO SAMSUNG
When the Trump Administration yanked all subsidies for EVs, automakers ended up writing off tens of billions of dollars they invested into making electric cars. So far, General Motors has written-off nearly $11 billion in EV investments since the second half of last year, which is far less than the $20-25 billion hits that Ford and Stellantis have taken. That’s because GM is trying to sell its EV assets instead of just writing them off. Now it’s selling the entire stake in its battery plant joint-venture to partner Samsung SDI. The plant in Indiana, which is still being built, will be Samsung’s first wholly-owned plant in North America. And like other projects, instead of producing EV batteries, the plant will pivot to make batteries for energy storage systems. But despite the sale, GM and Samsung will remain partners and they’ve signed a new agreement to jointly-develop next-gen prismatic batteries for future EVs.

HYBRIDS COULD BE 40% OF ALL VEHICLES BY 2030
While sales of EVs are growing slowly around the world, demand for hybrids is skyrocketing. In the U.S., hybrids accounted for 14% of total sales last year and demand is expected to more than double over the next decade. Hybrid sales in China are expected to rise, even though government policy favors EVs. And GlobalData forecasts that India, South America and Southeast Asia, will be the fastest growing markets for hybrids through 2035. Analysts are predicting that hybrids will account for as much as 40% of global production by 2030. And some automakers are even forecasting that hybrids will continue to grow at least until the middle of the century.

  

RAM LAUNCHES TURBO DIESEL IN POWER WAGON
While Ram revealed a new Cummins High-Output turbo diesel for the Power Wagon back in January, it’s only now taking orders for the model, which officially arrives in the third quarter of this year. The 6.7L 6-cylinder engine makes 430 horsepower and 1,075 lb-ft of torque, allowing the truck to tow nearly 20,000 pounds. A fifth-wheel/gooseneck option is also available for the first time on the Power Wagon diesel. It’s confusing to me why Ram doesn’t include destination charges on some models, like the new Rumble Bee, but does on others, like this, which starts a little under $90,000, including destination charges.

HYUNDAI TESTS ELECTRONICS BEFORE BUILDING CARS
In the not too distant past, engineers would work all the bugs out of a new car by putting it through a bunch of different driving conditions at the proving grounds. But electronics are playing such a big role in today’s cars that automakers are testing their electronic architectures before they even build their first prototype. A good example is Hyundai’s NOVA lab in Korea. NOVA stands for Next-Gen Open Validation. Engineers connect all the different electronic controllers on a test bench and run them through a battery of tests to catch things like communication failures, logic conflicts, and abnormal power consumption. They put the test bench on a compact dyno to simulate acceleration, braking and road inputs. They even project images into the vehicle cameras and beam radio waves at radar sensors to see how they react. The next step at NOVA is to start testing software defined vehicles using zonal, centralized architectures with 48 volt components. And using AI to find problems even faster.

But that’s a wrap for today’s show. Thanks for making Autoline a part of your day.