AD #3925 - EU Tariffs on Chinese EVs Kicks In Today; BYD Brings in More Revenue Than Tesla; Suzuki and Toyota Team Up on EVs
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Speaker 1: This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry. The deadline for the EU and
China to come to an agreement in their ev dispute as passed, so the higher tariffs were formally approved and published in the EU's official journal, which means they kick in today. The additional tariff on imported Chinese evs are
seven point eight percent for TESLA, seventeen percent for BYD, eighteen point eight percent for g L, thirty five point three percent for SEIC, and twenty point seven percent for everybody else. And remember that's on top of a ten
percent tariff for any vehicle imported into the EU and rules like these are typically in effect for five years.
But SCIC is ready to fight back, saying it plans to file a lawsuit with the EU's Court of Justice with the hope of at least getting its tariff down to a lower level. Writers reports that China also told
automakers to stop investing in countries that supported the tariffs.
In a vote earlier this month, ten European countries supported the tariffs, including France, Italy and Poland, and China could slap its own tariffs on European goods as well. The
Volkswagen Group reported its third quarter earnings, and the results show why it's aggressively trying to cut costs. It sold
more than two point one million vehicles, which is down eight point three percent compared to a year ago, and its revenue fell half a percent to seventy eight point five billion euros, but its operating profit slump nearly forty two percent to two point nine billion and its net profit plunged sixty three percent to about one point six billion euros. The group's profits were hurt by weak demand
for the VW brand, investments in new models, and high costs in Germany, and in addition to plan closings in layoffs, Germany's Hondelsblot newspaper reports that Volkswagen is also planning significant pay cuts. It says it will cut salaries by ten percent,
as well as cancel bonus payments, allowances and pay raises.
This would save the company about two billion euros a year, but that's only about half of the four billion it's aiming to cut. Meanwhile, it's much rosier over at BYD
it sold one point one two million electric and plug in hybrid vehicles in the third quarter, which is a thirty seven percent gain from a year ago. Its revenue
hit twenty eight point two billion dollars, which is a quarterly record for the company, and it was higher than Tesla's revenue of twenty five point two billion in Q three, which is the first time that BYD has beaten Tesla and revenue. And while BYD's net income rows eleven and
a half percent to one point six billion dollars, it was below Tesla's two point two billion dollar net profit in the third quarter. BYD now has a market cap
of one hundred and eighteen billion dollars, making it the third most valuable automaker in the world, behind Tesla and Toyota.
German engineering group Siemens has started to transition away from its heavy equipment business into more software products because it thinks it can make more money there and it's ready to spend big to do it. Bloomberg reports that Siemens
is nearing a nine billion dollar deal to buy Michigan based software developer all Taar Engineering, which would be its biggest acquisition ever. All Taar primarily provides solutions for the aerospace, automotive,
energy and financial industries. With the rise of AI, demand
for the kinds of software solutions that all Taar offers is expected to see big growth. Renault wants to shift
more research and development of electric vehicles to China, so it's building an EV R and D team in the country and plans to start mass producing a new electric car by late next year. It would mark the first
time the automaker has invested to develop a new car in China, but reports say the team will report directly to Renault's headquarters in France and the cars are only intended for Europe and other overseas markets, not China. As
you may know, Renault and Gili have a relatively new partnership.
In a year ago, Renault announced it would come out with vehicles on Gilie's CMA platform, so it may be looking for ways to leverage that partnership with this new R and D team in China. Speaking of teaming up
on evs, Toyota and Suzuki are forming a new partnership.
Since Toyota is so much bigger, you might think that it would supply Suzuki with an EV but it's actually the other way around. The model a battery electric SUV
will be developed and manufactured by Suzuki in India. They
say it will be available with four wheel drive, but other than that, the details are vague, like it will be nimble, offer ample range and have a comfortable cabin.
The platform for the SUV was jointly done by Suzuki, Toyota and Aihatsu, so there could be even more variants, but don't picture the tiny k cars that they already make together. They say this will be a global model.
Stillantis is in another legal battle with one of its suppliers over a pricing dispute. This time it's German parts
maker Brosa. Stillantis alleges in a lawsuit that Broza is
not honoring its contract and is demanding more money for parts.
The automaker also claims that it had to shut down its Windsor assembly plant back in July for two days because Brosa refused to ship parts without a price increase.
Stillantis says the production stoppage cost it three million dollars.
Brosa has not filed a response to the lawsuit, but set in a statement that it's quote hopeful for a resolution that allows our partnership to continue. Broza is at
least the fifth supplier that Stillantis has sued in the past year, mostly over similar pricing disputes. Automakers in Europe
are lobbying to delay or relax stricter emission rules that go into effect next year because they face finds up to fifteen billion dollars for missing the targets. But it
is not just passenger vehicles. Emission standards for vans also
get stricter next year, and automakers are worried about meeting those targets as well well. Companies must cut CO two
emissions from new vans by seventeen percent to one hundred and fifty four grams per kilometer on average. Automakers will
have to increase the number of electric vans they sell to meet the targets, but the problem is consumers aren't buying them. In the first six months of the year,
evvan sales in the EU fel three point seven percent, while sales of diesel vans increase sixteen percent, accounting for eighty four percent of the total market. Meanwhile, ev vans
only account for six percent of light commercial sales. But
in order to meet next year's CO two targets, Stillanta says it will have to increase its evvan share to twenty percent of sales, and Renault says it will have to hit eighteen percent so to become compliant, the companies say the likely have to reduce sales of ice vans.
In its Q three update, Tesla said it would start producing more affordable models than the first half of next year, and it looks like it's getting ready to do that.
The Austin Business Journal reports that Tesla has filed ten applications that would effectively double the size of its gigafactory in Texas. The company says these more affordable models will
combine aspects of both its current platforms as well as the next gen platform, but that they can still be made on the same manufacturing lines. With the move, Tesla
expects to get closer to its maximum manufacturing capacity, which is around three million units and would represent a fifty percent production increase over twenty twenty three. And that brings
us to the end of today's show. Thanks for making
Autoline a part of your day.
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