We’re excited to launch our Auto Briefing to keep you in the loop on the latest industry developments. Here is the week 1, based on conversations and news clips this week.
We hope this briefing provides valuable insights. Let us know what you think and feel free to suggest topics you’d like us to cover in future editions.
At a high level, the Western OEMs face a dilemma between two strategic approaches: adopting Tesla’s practices by developing their own designs and software while utilizing build-to-print EMS sourcing, or collaborating with partners such as Stellantis and Leapmotor, who may achieve similar cost outcomes but with significantly faster timelines.
PRODUCTS
- Ford views China as the leader in technology, cost and quality. Imports into the US could be devastating. Ford execs traveling to China to find low-cost solutions.
- Lincoln Nautilus Powertrain (engine and transmission) that is being produced in China has very good quality as compared to US produced powertrains, and significantly lower cost.
- Ford powertrains to offer plug in hybrid electrics, PHEVs, with a range of 70-100 miles on electric only. May prove very attractive to customers who can drive them without range and charging anxiety, and to the government who may agree they qualify as ZEV vehicles. Ford’s competitors are believed to agree. Ford will offer freedom of choice – ICE, Hybrid, BEV
- H2 Fuel Cells and non-petroleum-based fuel in ICE and Diesel engines are under study for the future.
- ADAS interest is growing. Increased competition for LiDAR.
- BMW cancels $2.15 B order for EV battery cells from Northvolt – Battery cell manufacturing scale up is hard.
CUSTOMERS
- McKinsey reports that 46% of EV customers are planning to buy ICE powertrains on their next purchase.
- The Lincoln Nautilus, imported from China with both ICE and hybrid powertrains, is proving more popular in the US than China where they are viewed non-competitive in product and price.
- Commercial customers may have growing interest in a small van for last mile delivery.
POLITICS
- A Trump administration may reduce incentives for EVs and reduce regulation of the industry.
- A Trump administration may bring US tariffs equal to exporting country’s tariff on US products.
- GM-LG battery plant in Ohio votes heavily for the UAW.