Fuel efficiency regulations are rules that make car companies build cars that use less gas and pollute less. This helps protect the environment and save money on fuel.
When you buy a new car, there is an extra fee called destination charge that pays for getting the car from where it's made to the dealer. This fee has been going up lately, making cars more expensive.
EV adoption means how many people are buying and using electric cars. If not many people buy them quickly, it can cause problems for companies that make parts for these cars.
EV incentives are deals from the government that help people buy electric cars by giving money back or lowering taxes. To get these deals, the car needs to be partly made in the local area.
A solid state battery is a new type of battery that uses solid materials inside instead of liquids. This helps cars charge faster, hold more power, and be safer to use.
The Acura Integra is a small, sporty car that people like because it’s fun to drive and looks cool. The Type S is a special, more powerful version that many car fans really like. Now, Honda is making these cars in the US and sending them to other countries, which shows they are popular worldwide.
The Honda Integra Type S is a faster and sportier version of a Honda car, and now it's being sent from the US to Japan.
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Speaker 1: This is Autoliged daily, the show dedicated to enthusiasts of the global automotive industry. While we can't start today's show
without mentioning the war between the US and Iran, automakers and suppliers will be keeping a close eye on the price of oil because if gasoline prices start surging at the pump, it could have a profound impact on the mix of vehicles that they sell. The Detroit Three were
anticipating they could sell a lot more V eight powered full sized trucks and SUVs this year as the Trump administration eased off fuel efficiency and emission regulations, but a sudden jump in gasoline prices could push buyers towards fuel efficient models, especially hybrids. So far, the price of a
barrel of oil jumped from sixty five dollars last Wednesday to about seventy two dollars this morning, or about a ten percent increase. And here's the thing to keep an
eye on. If prices at the pump rise slowly, consumers
will largely shrug it off. But if they go up quickly,
new car sales will slow down fast. And if the
price at the pump really goes up, who knows, maybe evs will start looking a whole lot more attractive to a lot more buyers. Speaking of new car sales, the
early February numbers out of China look ominous. Some of
the largest automakers posted significant declines. BYD was down forty
one percent compared to last year, Japang was down fifty percent, Jili was down eleven percent, and great Wall fell almost seven percent. And yet Neo was up fifty eight percent.
So we'll have to wait for the China Passenger Car Association to post the full results for the industry to get a feel for the overall market. The Chinese New
Year is having an impact, but even these early numbers are rocking the market because so far this year, Jili has moved past BYD to become the best selling automaker in China. Destination charges, which are meant to cover the
cost shipping a new vehicle, are going through the roof.
In twenty seventeen, they averaged about one thousand dollars, but those fees have continued to rise since then and now sit at an average of sixteen hundred bucks. According to
data from Edmunds, Americans spent over twenty six billion dollars on destination charges last year. Increased fuel and shipping costs
have played a role in the rising charges, but terraces and fear of rising prices because of teriffs are also likely factors. Many manufacturers don't include the destination charges and
their suggested retail prices, so the increases have been less obvious to consumers. Suppliers in Europe are warning they face
a crisis due to slower than expected EVY adoption, Chinese competition, regulatory pressure, and demand from automakers to lower prices. Over
the past two years, suppliers have announced one hundred and four thousand job cuts, and the European Association of Automotive Suppliers or KLEPPA, is warning that three hundred and fifty thousand jobs will be at risk by twenty thirty. It
says fifty percent of suppliers are planning to reduce production in Western Europe over the next five years because of weaker profits. An annual supplier investment is estimated to be
about four billion euros, less than previous projections, reaching thirty five point six billion by twenty thirty. The EU is
expected to release a proposal this week that could require seventy percent of an EV's value to be made in Europe to qualify for incentives. Kleppa says that needs to
be increased to seventy five percent, and if the policy only focuses on final assembly or certain components and products quote, the risk of delocalization through unfair competition cannot be stopped and that could lead to all those job cuts.
Speaker 2: 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: Hyundai wasn't the only company to cause a sensation at CES.
So did Donut Lab with the claims it made about its new solid state battery. It said they hit four
hundred watt hours per kilogram charge from zero to one hundred percent and five minutes handle one hundred thousand charging cycles and cost less than lithium batteries. However, battery experts
have been quite vocal in their skepticism of Donut, so Donut is trying to win a little credibility by allowing cells to be tested by a respected research center, the VTT of Finland. It's releasing those results in a series
of reports, the first of which focused on charging. While
the cell performed well, its energy capacity was lower than donuts claims of four hundred watt hours per kilogram. Charging
time was slower, and some others pointed out that one of the charging tests was aborted because the cell had a temperature threshold of ninety degrees celsius or one hundred and ninety four degrees fahrenheit. The newest tests from the
VTT focused on high temperature performance, including tests of eighty and one hundred degrees celsius or one hundred and seventy six and two hundred and twelve degrees fahrenheit. Donut says
the cells showed that they had more capacity when really hot than they did at room temperature. However, the cells
were only discharged at that higher temp they were charged at room temp, so I'm not sure Donut will quiet the skeptics.
Speaker 2: Yet.
Speaker 1: Despite an expected increase in rare earth production outside of China, a new report from Bloomberg Intelligence says the supplies won't be enough to meet demand by the end of the decade.
Governments around the world are trying to lessen reliance on China for the magnets that are needed for electric vehicles, electronics, and military uses. This year alone, producers are estimated to
raise ten billion dollars in public funding to mine rare earth, and output from non Chinese companies is expected to quadruple by twenty thirty. But with demand for rare earth expected
to grow seven percent a year through the end of the decade, the new output won't be enough to meet it.
And speaking of raw materials, lithium producer SQM says global demand for the metal will grow twenty five percent this year and that could lead to an increase in prices, which have taken a big tumble because of a prolonged period of oversupply. While lithium prices have doubled from a
June low, there's still seventy percent below their peak in twenty twenty two. The terrists put in place by the
Trump administration have cost automakers and suppliers tens of billions of dollars, but there are some clever ways they can cut the cost. One way is to lower the value
of the imported car or component, which are atomatically lowers the tariff. That means importers have to dig deeper into
their supply chains and find what's called the first sale, that is the cost of the product when it was made before any middle men were involved, and before any insurance or shipping costs were added. We suspect that automakers
can also play around with the transfer prices where they lower the value of an imported car and pay a lower tariff. Automakers who export cars from the US can
also get credits that they can apply to lower the tariffs on the cars that they import. This is probably
the main reason why Honda is going to launch the Accurate brand in Japan for the first time ever and start exporting US made Integra Type s's as well as Honda Passport elites. Honda isn't even bothering to build them
with the steering wheel on the right hand side. It
will just export them as is. And we think that's
all got to do with tariffs. And that's a wrap
for today's show. Thanks for making Autoline a part of
your day.
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About this episode
Rising destination fees are costing American car buyers billions, driven by higher fuel and shipping costs and tariffs. In China, Jili has overtaken BYD as the top automaker amid significant sales declines industry-wide. European suppliers warn of massive job cuts due to slow EV adoption, Chinese competition, and regulatory pressures. Battery startup Donut Lab faces skepticism over its solid-state battery claims after independent tests. Meanwhile, rare earth supply shortages and rising lithium demand signal challenges for EV production. Automakers are also using tariff strategies to reduce costs, exemplified by Honda's new export plans.
- Will Gas Prices Push Buyers Toward Hybrids? - Geely Overtakes BYD In Chinese Auto Market - Hidden Destination Fees Cost Car Buyers Billions - European Suppliers Warn of Massive Job Cuts - Experts Skeptical of Donut Lab Battery Claims - Rare Earth Production Lags Behind EV Growth - Lithium Demand Set to Grow 25% - Automakers Use Clever Tactics to Cut Tariffs
