AD #4187 - Tesla the #1 AI Chip Supplier?; VW Cuts Some Costs in China 50%; Merger Creates World's Largest Paint Supplier

Speaker 1: This is out Oflged Daily, the show dedicated to enthusiasts of the global automotive industry. Elon Musk has trained us

to be highly skeptical of his timelines for new technology, but if he pulls this one off, he'll be on his way towards collecting that trillion dollar pay package. Mus

says Tesla is nearly done with the design of its next AI chip, called AI five, and already started early work on the next generation AI six chip.

Speaker 2: He says Tesla will.

Speaker 1: Bring out a new AI chip every twelve months and that ultimately it will make more AI chips than everyone else put together. The chips will actually be manufactured at

a Samsung Electronics plant in Texas. But if Musk can

achieve that, he has a good shot at growing Tesla's market cap, General Motors is losing another software executive. The

company's chief artificial intelligence officer, Barack Terowski, announced he leaving GM after just eight months on the job, even though that role was specifically created forum. A GM spokesperson said

Tarrowski's departure is part of a strategic plan to integrate its AI capabilities into its business and product organizations, rather than being standalone. But this is another hit to GM's

software team. Last month, Dave richardson the company's VP of

software also left the company. GM software development is now

mostly led by Chief Product Officer Sterling Anderson, a former Tesla executive who joined GM in June. While we don't

know why these execs are leaving, here's one thing that we've observed. When an outsider abruptly leaves an automaker after

a brief stint, it's usually because they got tired of all the bureaucracy, or the bureaucracy got tired of them.

We've got the latest new car sales numbers from Europe and there are some interesting developments. EV sales shot up

almost thirty three percent in October. Keep in mind we're

quoting sales for all of Europe, not just the EU EV market share top twenty percent versus sixteen percent a year ago, which is a significant jump. Total light vehicle

sales hit a million units, up almost five percent from last year. The Volkswagon group had a strong month, and

so did Stilantis and Renault, but Toyota fell one percent and the Hyundai group was only up a fraction of a percent. We mentioned them because those five automakers account

for about seventy percent of the market. And here are

two important developments so far this year. Hyundai and Kia

are out selling Toyota and Lexus. There's one milestone for you,

and it's stunning to see how far Mercedes has dropped behind BMW. Even if you strip out sales of Mini,

Mercedes is disappearing in BMW's dust. The rush car market

is going from bad to worse. High interest rates have

pushed up the price of new vehicles, now averaging more than forty two thousand dollars.

Speaker 2: As a result, sales are plunging.

Speaker 1: Through October, automakers have sold just over a million vehicles, down almost twenty percent compared to a year ago, and they're expected to drop even more next year because Russia is raising fees on new vehicles so they're not eroded by inflation.

Speaker 2: Remember before it invaded.

Speaker 1: Ukraine, Russia's car market was on track to sell four million cars. Electric vehicles are starting to catch on in India.

Evs now account for five percent of new car sales, up from two and a half percent last year. Bloomberg

estimates that EV sales will reach at least six hundred and fifty thousand units by twenty thirty, and Tata Motors, which is the leader in EV sales in India, expects evs to account for a third of its sales by twenty thirty.

Speaker 3: At CSP, we work with OEM engineers across the country on their journeys to lighter, safer, and more eco friendly vehicles.

Learn more at VCSP dot com.

Speaker 1: More and more automakers are adding e revs or extended range electrics to their lineups, and.

Speaker 2: BMW could be the next.

Speaker 1: Bloomberg reports that the company is considering the technology for its top end models like the X five and seven series.

Speaker 2: BMW already makes.

Speaker 1: Some of the components in house, which would reduce the cost to introduce the technology, but no decision has been made yet. Volkswagen's strategy to make vehicles quote in China

for China is really paying off. We recently highlighted how

both VW and Audi have started to clawback sales, but the group is also benefiting from things like a new multi billion dollar innovation center in the country, where it's able to run software, hardware, and full vehicle validation processes at the same time. That has helped it slash its

vehicle development cycle from about fifty months down to roughly thirty five and when combined with lower labor rates and better supply chain efficiencies like access to batteries, Volkswagen has cut its EV development costs for some models in half compared to what it would have cost the company to make an EV in Germany in twenty twenty three. That's

why it's going to increase exports of these new Chinese made vehicles to markets like Central and Southeast Asia, including Chinese made ICs to the Middle East. So far, VW

says it will not export to Europe, but we wonder what kind of impact this could have on the company's European production volume. I think it would be smart for

Tesla to take a page out of Zeker's book. The

Chinese automaker is launching a crowdfunding campaign to upgrade the older driver assistant systems and two of its models. It's

looking for three thousand owners of its Double OH one model and fifteen hundred owners of the Double OH nine to agree to the upgrades, which would cost about two to three thousand bucks. But that includes new bumpers, windshield sensors,

and wiring. Zeker claims the hardware alone is worth just

over four thousand bucks, and then it still takes about twenty hours to install, which looks like you pretty much have to remove the entire interior. The vehicles currently have

a mobile eye based eight ass system, but would upgrade to an in house developed system that uses Nvidia tech and has nearly fifteen times the computing power. Big news

in the world of automotive paint, Axo Noobel and Exalta are merging to become the world's largest coding supplier. Axo

Noobel is based in the Netherlands, while Exalta is based in Philadelphia and used to be part of DuPont. There

doesn't seem to be a new name for the merger, but Axo Nobel does have a fifty five percent controlling interest.

The new company will generate seventeen billion dollars a year in revenue with EBITDA profit margins of twenty percent and free cash flow of one point five billion dollars a year, which are very attractive financial numbers and a heads up for all our viewers out there. There will be an

all new auto line daily tomorrow, but we're taking Thursday and Friday off for the Thanksgiving holiday. And also here's

a reminder for all our YouTube and Patreon members. John

and I will be going live to answer your questions at two thirty pm Eastern time today. We're already getting

questions from you, so send yours in if you haven't already.

Speaker 2: Or even send them in during the live show.

Speaker 1: And this is just another way for us to show you our appreciation for your support. And with that we

wrap up today's Autoline Daily. Thanks for watching the show.

Speaker 4: Auto Line Daily is brought to you by Alex Partners.

When it Really Matters CSP, the Composites Solution Partner, Intrepid Control Systems, over the Air Engineering, boost your game and thanks to the following YouTube and Patreon members.

Speaker 5: We help businesses respond decisively to their most critical challenges, from urgent performance improvement to enterprise wide transformation. We work

across the full value chain in automotive and in industrials, helping clients navigate disruption, drive innovation, and unlock sustainable growth.

Alex Partners When it really Matters.

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AD #4187 - Tesla the #1 AI Chip Supplier?; VW Cuts Some Costs in China 50%; Merger Creates World's Largest Paint Supplier

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