AD #4077 - Stellantis Stuck with CARB ZEV Mandate; Luca de Meo Quits Renault; Nio Officially Drops U.S. Plans

Speaker 1: This is Underline Daily, the show dedicated to enthusiasts of the global automotive industry. Five years ago, Renault named Luca

Demeyo as CEO. He quickly set out to transform the company.

He turned it from a money loser to solidly profitable.

He spun off its IC operations into a new company called Horse, He created a new software and EV division called Ampere, and yesterday he decided to quit Renault and join a company called Caring, which owns a bunch of luxury brands, including Gucci. That sent shockwaves through the industry

and left the Renault board scrambling to find a new leader.

And hot on the heels of that announcement, Nissan says it's going to reduce its investment in Renault. The Japanese

auto maker currently owns fifteen percent of Renault, but both companies have an agreement to cut both of their cross ownership holdings down to ten percent. However, we already knew

that Nissan is choosing to say it again. On the

day that Tomayo is quitting, Nissan should be able to raise about six hundred and forty million dollars by selling off five percentage points of its holdings in Renault, and it promises to plow that money back into developing new models and shoring up its shaky finances. Ford's CEO, Jim

Farley says the automaker is critically low on rare earth supplies.

In an interview with Bloomberg, he said it's rare earth supply is day to day and that it's had to shut down plants because of the shortage. Last week, China

agreed to grant temporary licenses for rare earth to suppliers of Ford, GM and Stlantis. However, Farley says it hasn't

seen an improvement in supply yet and that China is only approving applications for rare earth one at a time. China,

which controls ninety percent of global rare earth production, began restricting supplies in April in retaliation to US tariffs. Last week,

President Trump signed legislation revoking an EPA waiver that allows California to set its own emission standards. However, Stillantis still

has to follow California's mandate because of a deal it signed with the state last year. Stalantis was struggling to

comply with the state's emission regulations, but it didn't want to buy credits to meet them, so it made a deal to avoid penalties in the short term in exchange for agreeing to meet California Zero Emission Vehicle or zeb requirements starting with the twenty twenty six model year through twenty thirty. The rules require thirty five percent of new

car sales to be zev's in twenty twenty six, and it ramps up to sixty eight percent and twenty thirty and as part of the deal, Stillantas said it would follow California's rules regardless of any judicial or federal action preventing them from going into a fact and it's going to be tough for Stilantis to comply with the rules.

While plugin hybrids are allowed to account for twenty percent of its requirement, peebs only accounted for eight percent of stillant as a sales nationwide last year, and it only has three evs on sale, which accounted for less than two percent of its sales in the first quarter.

Speaker 2: There's nothing wrong with heavy metal hy light enough, but with world class composit material Taging Automotive Technologies makes vehicles lighter, safer, and more eco friendly.

Speaker 1: Last week, automakers in China agreed to make payments to suppliers within sixty days, but suppliers say they're skeptical to companies will follow through with their promise. Car companies typically

pay suppliers in sixty days, but in China that is stretched to hundreds of days in some cases, so the government stepped in last week to help speed up payments because suppliers, especially smaller ones, are struggling financially, but some suppliers are concerned automakers will find workarounds. One practice automakers

could use is to issue promissory notes, which delays cash recovery for an additional period. Of the seventeen automakers that

pledge to speed up payments, only BAIC and SEIC agreed to not issue promissory notes. The others didn't specify how

they'll make the payments. Despite the UK negotiating a ten

percent tariff on the first one hundred thousand cars at imports to the US each year instead of twenty five percent, JLR is still considering raising prices to offset the higher fees.

While range Rovers are made in the UK, its Defender brand is built in Slovakia, which is part of the European Union and subject to the twenty five percent tariff.

As a result, JLR also lowered its EBIT margin forecast from ten percent down to a range of five to seven percent for the year. Neo recently announced that it's

expanding into seven new European countries, but Electric Vehicles dot Com reports that it's giving up on one very important market.

The Chinese automaker has suspended plans to enter the US, which was part of a global expansion first revealed in twenty twenty one. Neo had already operated an innovation center

in San Jose, California for five years by the time of that announcement, and in twenty twenty two expanded the facility even more. But over the last year, the company

has eliminated many of the teams working there, and the new report says it accelerated its decision not to enter the US market due to trade tensions between the US and China, as well as new tariffs on Chinese imports, and if Bank of America analyst John Murphy is right, all lack of market share could be another reason for backing out of the US. Murphy predicts ev market share

will stick to about eight percent, roughly where it was at the end of last year for the next five years to come. Blaming inconsistent support from the government. However,

Murphy also predicts that overall sales will grow to sixteen point five million this year and to a possible eighteen million by twenty twenty eight, which means that overall EV sales will grow as well. For the first time ever,

Pougeau is applying its sporty GTI badge to an all electric vehicle. The E two eight GTI is thirty millimeters

or just over an inch lower, comes with larger front rotors, four piston front calipers, springs and shocks with specific hydraulic stops, a rear sway or anti roll bar, and unique eighteen inch wheels that widen the track. Power comes from a

single electric motor that makes two hundred and eighty horse power, which will accelerate the car from zero to one hundred kilometers an hour, which is similar to zero to sixty and five point seven seconds. CATL supplies the fifty four

kilowat hour battery pack for the E two GTI, which provides three hundred and fifty kilometers or about two hundred and fifteen miles of range on the WLTP test cycle.

While no pricing is available yet, the model is expected to hit the European market before the end of the year.

Akio Toyota has famously defended hybrid cars by saying one EV puts out as much pollution as three hybrids, but university researchers in China say he's wrong. One university did

a study which found that evs emit twenty to thirty percent less CO two over their lifetimes than hybrids. That

even takes China's coal heavy generating infrastructure into account. And

it's not just Chinese researchers who are saying this. The

Argonne National Lab in the US did an extensive study that found that EV's were cleaner than the average gasoline powered vehicles after both have been driven nineteen thousand miles, and they're cleaner than hybrids after they've been driven about twenty eight thousand miles. Moreover, EV manufacturing and electrical grids

continue to get cleaner, while ice production does not. Ian Callum,

the former had a design at Jaguar and who also worked for Ford Aston Martin and Tom Walkinshaw Racing, was in Detroit this weekend. To receive the prestigious Eyes on

Design Lifetime Achievement Award. It's voted on by the top

designers in the industry as well as previous winners. During

the course of the evening, it came out that Ian was the one who designed the state hears for Queen Elizabeth the Second. It was based on a Jaguar EXJ

and the Queen personally approved his design and added her own inn put that was in twenty thirteen, but Callum was told to never talk about the car, which was put in a box and only removed and told her funeral in twenty twenty two. It's the first time he's

ever gone public with the story. And so there's your

automotive anecdote for the day. But that's a wrap for

this show. Thanks for tuning in.

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AD #4077 - Stellantis Stuck with CARB ZEV Mandate; Luca de Meo Quits Renault; Nio Officially Drops U.S. Plans

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