AD #3917 - Stellantis To Cut ICE Production to Meet EU CO2 Regs; U.S. EV Registrations Up 18%; Japanese OEMs To Cooperate on SDVs

Speaker 1: This is Outoline Daily, the show dedicated to enthusiasts of the global automotive industry. Automakers in Europe face potential fines

of up to fifteen billion euros for not meeting stricter CO two targets that go into effect next year. BMW

and Renault want the rules relaxed, but Stillantis CEO Carlos Tavares doesn't want any change. However, the COO of Stalantis

in Europe says it might have to cut production of ice vehicles just to meet the standards. The company needs

to double its EV share next year to twenty four percent if it's going to meet the targets, and it could start cutting production as soon as November one. And

remember it's already cutting some EV production due to poor sales.

But one thing that will help Stilantis is its joint venture with Chinese EV maker Leap Motor, since the JVS sales will count towards its emission figures. But if automakers

aren't able to delay next year's targets, other companies could also start cutting production to avoid fines. The rules require

an EV share of twenty to twenty five percent, but as of August, the EV share in the EU was less than thirteen percent, while EV sales have slowed dramatically in Europe and are actually falling in Germany.

Speaker 2: Global sales of bvs and plug in.

Speaker 1: Hybrids were up twenty six percent in the first half of the year, and Bloomberg NEF forecast that they'll hit sixteen point seven million units by the end of the year.

That would be up from thirteen point nine million last year and represent twenty percent of the global car market.

As you can probably guess, China fuel most of that growth.

Six out of ten b evs and p have sold are sold in China. Pricing plays a role. There's lots

of inexpensive evs in China.

Speaker 2: But not in Europe.

Speaker 1: Take the Fiat five hunh hundred for example. In Europe,

the electric version is nearly twelve thousand euros or about thirteen thousand dollars more than a base ic version, even though it only has about three thousand euros worth of batteries.

Bloomberg NEF thinks European automakers are holding back more affordable evs until next year because they already comply with the emission REGs this year.

Speaker 2: It thinks that next year.

Speaker 1: When the rules get stricter, it's when automakers will flood the EU market with their cheaper evs. Even though EV

sales are up globally. CATL just posted its third quarter earnings,

and while the numbers look pretty good, they came in lower than analysts expected. Revenue was twelve point seven billion dollars,

but that was down more than twelve percent compared to last year. Net income hit one point eight billion dollars,

which was up a sharp twenty six percent, but analysts expected it to post a two billion dollar profit. Even

so well, the market shrugged off the news. Ctl stock

was up nearly eight percent today and it's up fifty nine percent for the year. Speaking of stock prices, Hyundai

and Lucid are turning to the equity markets to raise more capital. Hundai is doing an IPO for its business

in India that.

Speaker 2: Is raising at least three billion dollars.

Speaker 1: Making it the biggest initial public offering that's ever happened in India. That gives Hyundai Motor India a market cap

of nineteen billion dollars. Many automakers believe that India will

be the next big growth market for cars, and we're starting to see a flurry of investments there. Meanwhile, Lucid

is going to sell about six hundred and thirty seven million shares of its stock, which it hopes will raise over one point six billion dollars.

Speaker 2: We think it needs to make this move.

Speaker 1: The evy startup is burning through cash and might only have enough to last into twenty twenty six. Even with

the Saudi Investment Fund being a major shareholder. Investors did

not like the stock selling news, which will dilute their equity in the company. Moreover, Lucid warn that it's going

to post an even bigger loss for the third quarter.

The stock drop eighteen percent and is now trading at only two dollars and seventy cents a share. Growth of

pure electrics in the US is outpacing the overall market.

Speaker 2: According to S.

Speaker 1: And P Global Mobility BEEV registrations in August came to nearly one hundred and twelve thousand units, which is an eighteen percent increase over last year. That means they represented

eight point six percent of all vehicles sold in the month, up from seven and a half percent in twenty twenty three.

Speaker 2: A few surprises might be.

Speaker 1: The Tesla cyber Truck and the Honda Prologue in third and fourth place, respectively. But it would be interesting to

know where these numbers would stand if automakers actually sold their evs for what they said they would originally list four.

Many models have starting prices well above what automakers said they would cost, which is especially true of the electric pickup trucks, and we think that's had a big impact.

Speaker 2: For example, the waiting.

Speaker 1: List for the cyber truck was once put as high as two million reservations, but you no longer have to be a reservation holder to order the truck, and based on a recent cyber truck recall, we think the Tesla has delivered around thirty thousand units, so it hasn't converted most of those reservations to sales yet, and price is probably a big part, and it's not just Tesla. Ford

actually capped f one to fifty Lightning orders at two hundred thousand units, but prices came in much higher, and it still hasn't been able to get a lot of those people to buy the truck. General Motors is using

artificial intelligence to improve production and to help it catch any glitches with its software. The company has developed an

automated tool which operates around the clock that runs simulations to find any problems with software before it goes into a vehicle. To help with production, it's using another tool

that inspects and validates weld quality, and it's also using cameras and analytics to collect one hundred and sixty five million images a day to anticipate manufacturing equipment failures. GM's

VP of Software, Dave Richardson says these new tools are catching ten times as many problems and much sooner, which is leading to the improvements in its quality.

Speaker 2: If you're in.

Speaker 1: The market for a used EV, you might want to put the Nissan Aria on your list. Inside Ev reports

that one year old Arias are selling for less than half of their original MSRPs.

Speaker 2: One twenty twenty three model, with only.

Speaker 1: Ten thousand miles is priced just over twenty two thousand bucks.

Its original MSRP was forty eight thousand, five hundred and eighty dollars, which is about a fifty.

Speaker 2: Four percent drop.

Speaker 1: In total, there are two hundred and seventy used Arias on cars dot Com priced at less than thirty thousand dollars.

Thirty nine of them are under twenty five grand and one hundred and forty six of them have less than ten thousand miles on the odometer. But the drop in

used prices is also partly due to Nissan lowering the base price of the twenty twenty four model. This next

piece is a pretty important development in Japan. Toyota, Honda,

and Nissan are going to standardize the platform for APIs, or the application programming interfaces that will make it easier for other software companies to develop apps for their cars.

They're also going to collaborate on developing software to find vehicles or sdvs, as well as standardize certain functions for microprocessors and cars, like lowering a window or turning on the wipers. The whole effort is being coordinated by Japan's

Ministry of Economy, Trade and Industry, which is also going to work with universities to teach the people that will work in these fields. Japan recognizes that its auto industry

has fallen behind in software to find vehicles and needs to catch up, and by standardizing many areas, automakers will be able to go with off the shelf technology instead of having to try and develop it on their own, and that brings us to the end of today's show and this week. Thanks for tuning in and I hope

that you have a great weekend.

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AD #3917 - Stellantis To Cut ICE Production to Meet EU CO2 Regs; U.S. EV Registrations Up 18%; Japanese OEMs To Cooperate on SDVs

Tesla Cyber Truck

Honda Prologue

Ford F-150 Lightning

Nissan Aria

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