AD #4252 - Honda Cancels EVs, Takes $16 Billion Hit; Carvana Buys Stellantis Stores, Dealers Don't Like It; China Car Sales Drop 26%
About this episode
Global automotive markets face turbulence with China’s car sales dropping 26% and new energy vehicle sales declining. Tesla shows strong recovery in China but faces long-term sales challenges. Honda cancels three EV models, taking a $16 billion hit and executives taking pay cuts amid shifting strategies. Carvana’s acquisition of Stellantis dealerships disrupts traditional dealer networks. Nissan partners with Uber for autonomous taxis in Tokyo. Chinese automakers push into Europe’s electric heavy truck market, while Kia gains momentum in the US with its redesigned Telluride SUV. Industry adapts amid geopolitical tensions and evolving technology trends.
new energy vehicles
"Sales of passenger cars in China have slowed significantly this year, falling twenty six percent for the first two months, and surprisingly, sales of new energy vehicles, which includes BEVs and plugins, were down seven percent."
New energy vehicles are cars that run on electricity or a mix of electricity and gas instead of just gas. They help the environment by polluting less.
New energy vehicles (NEVs) refer to vehicles that use alternative energy sources instead of traditional gasoline or diesel. This includes battery electric vehicles (BEVs) and plug-in hybrids, which are key to reducing emissions and dependence on fossil fuels.
BEVs
"Sales of passenger cars in China have slowed significantly this year, falling twenty six percent for the first two months, and surprisingly, sales of new energy vehicles, which includes BEVs and plugins, were down seven percent."
BEVs are cars that run only on electricity stored in batteries, so they don't use gas or make smoke from the tailpipe.
BEVs stands for Battery Electric Vehicles, which are cars powered entirely by electricity stored in batteries, producing zero tailpipe emissions. They differ from hybrids because they do not use gasoline engines.
plug-in hybrids
"Sales of passenger cars in China have slowed significantly this year, falling twenty six percent for the first two months, and surprisingly, sales of new energy vehicles, which includes BEVs and plugins, were down seven percent."
Plug-in hybrids are cars that can run on both electricity and gas. You can charge their batteries by plugging them in, and they use gas when the battery runs out.
Plug-in hybrids are vehicles that combine an internal combustion engine with an electric motor and a rechargeable battery. They can run on electric power alone for short distances and switch to gasoline for longer trips.
negative cash flow
"Morgan Stanley and morning Star our forecasting that Tesla's global sales will drop for the third year in a row, and they're warning that Tesla will post negative cash flow in twenty twenty six for the first time in seven years."
Negative cash flow means a company is losing money because it spends more than it makes. This can be a problem if it keeps happening.
Negative cash flow means a company is spending more money than it is earning over a period of time. For automakers, this can indicate financial challenges that may affect operations and investments.
Tesla humanoid robot
"But Tesla is also showing off the third generation of its humanoid robot at an expo in Shanghai this week. Elon Musk says it will go into mass production by the fourth quarter and that Tesla will make a million a year."
Tesla is making a robot that looks and moves like a person. They plan to make a lot of these robots soon.
Tesla's humanoid robot is a robot designed by Tesla to perform human-like tasks. The third generation was showcased with plans for mass production, reflecting Tesla's expansion beyond vehicles into robotics.
Stellantis
"Used car retailer Carvana has quietly acquired half a dozen Stilantis dealerships over the past year. It's now offering new cars for sale on its website that are priced thousands of dollars below the MSRP, and it's also offering home delivery, just like it does with its used vehicles."
Stellantis is a big car company that owns many brands like Jeep and Dodge. They sell cars all over the world.
Stellantis is a multinational automotive manufacturer formed by the merger of Fiat Chrysler and PSA Group. It owns brands like Jeep, Ram, Dodge, and others, and operates dealerships worldwide.
Carvana
"Used car retailer Carvana has quietly acquired half a dozen Stilantis dealerships over the past year. It's now offering new cars for sale on its website that are priced thousands of dollars below the MSRP, and it's also offering home delivery, just like it does with its used vehicles."
Carvana is a company where you can buy used cars online and have them delivered to your home. They now also sell new cars from some dealers they bought.
Carvana is an online used car retailer known for its digital buying experience and home delivery service. It recently expanded by acquiring several Stellantis dealerships, offering new cars at prices below MSRP.
MSRP
"Cars for sale on its website that are priced thousands of dollars below the MSRP, and it's also offering home delivery, just like it does with its used vehicles."
MSRP is the price the car company thinks the car should cost when you buy it new. Sometimes dealers sell cars for more or less than this price.
MSRP stands for Manufacturer's Suggested Retail Price, which is the price automakers recommend dealers charge for a new vehicle. It serves as a baseline for pricing but dealers may sell above or below this price.
online car sales process
"However, analysts say dealers may need to adopt Carvana's online sales process since it's popular with many car buyers."
Buying a car online means you can look at cars, see prices, and even get the car delivered to your home without going to a dealership.
The online car sales process refers to buying vehicles through internet platforms, including browsing, pricing transparency, and home delivery. This method is growing in popularity and changing traditional dealership sales models.
write off
"Ford recently announced a nearly twenty billion dollar write off while Stillantis rode off twenty six billion, and now Honda says it will book up to nearly sixteen billion dollars in losses and it shifted away from eves."
A write off means a company says it lost money on something, like a project or product, and lowers its value in their records.
A write off in business accounting is when a company records a loss on an asset or investment, reducing its value on financial statements. Automakers may write off costs related to canceled projects or unsold inventory.
Acura RSX
"Honda says it will book up to nearly sixteen billion dollars in losses and it shifted away from eves. The automaker is canceling three evs it was developing for North America, the Zero Series SUV, the Zero Series saloon, and the Accura RSX."
Honda was planning an electric car called the Acura RSX but decided not to make it to save money.
The Acura RSX is a model Honda was developing as an electric vehicle for North America but has canceled. Acura is Honda's luxury brand, and the RSX name has been used for sporty compact cars.
Honda Zero Series saloon
"Honda says it will book up to nearly sixteen billion dollars in losses and it shifted away from eves. The automaker is canceling three evs it was developing for North America, the Zero Series SUV, the Zero Series saloon, and the Accura RSX."
Honda was working on an electric sedan called the Zero Series saloon, but they stopped making it to avoid losing money.
The Honda Zero Series saloon is an electric sedan model Honda was developing for North America but canceled as part of its pivot away from EVs due to financial losses.
Honda Zero Series SUV
"Honda says it will book up to nearly sixteen billion dollars in losses and it shifted away from eves. The automaker is canceling three evs it was developing for North America, the Zero Series SUV, the Zero Series saloon, and the Accura RSX."
Honda was making a new electric SUV called the Zero Series SUV, but they decided to stop making it to save money.
The Honda Zero Series SUV is one of the electric vehicle models Honda was developing for the North American market but has now canceled. This reflects Honda's strategic shift away from EVs in response to financial pressures.
Wave technology
"Nissan is partnering with Uber to provide it with autonomous vehicles powered by Wave technology for a robotaxi service."
Wave technology is the computer system that helps the car drive itself safely without a driver.
Wave technology refers to the autonomous driving system powering the robotaxi vehicles, likely involving sensors, AI, and software to enable self-driving capabilities.
autonomous vehicles
"Nissan is partnering with Uber to provide it with autonomous vehicles powered by Wave technology for a robotaxi service. At the time, we didn't have details, but now we do."
Autonomous vehicles are cars that can drive by themselves without a person controlling them. They use computers and cameras to know where to go and avoid obstacles.
Autonomous vehicles are cars or other vehicles capable of sensing their environment and operating without human input. They use technologies like sensors, cameras, and AI to drive themselves.
robotaxi service
"Nissan is partnering with Uber to provide it with autonomous vehicles powered by Wave technology for a robotaxi service. At the time, we didn't have details, but now we do."
A robotaxi is like a taxi but the car drives itself without a driver. People can use an app to get a ride in these self-driving cars.
A robotaxi service uses autonomous vehicles to provide taxi-like rides without a human driver. This is an emerging business model in urban mobility.
Nissan Leaf
"The companies will begin a pilot test in Tokyo by the end of the year using self driving leafs, which will be available on the Uber app. It's the first time Uber will offer autonomous rides in Japan..."
The Nissan Leaf is an electric car that runs only on batteries, no gas. Here, Nissan is testing driverless versions of this car to give rides through Uber.
The Nissan Leaf is a fully electric compact car produced by Nissan, known for being one of the first mass-market electric vehicles. In this context, Nissan is using autonomous versions of the Leaf for a robotaxi service with Uber.
EV adoption
"With all the investments in EV over the last several years, we had one industry insider tell us they were worried that automakers would never do a clean sheet engine design ever again. But now that EV adoption hasn't progressed at the rate that many thought..."
EV adoption means how many people are buying and using electric cars instead of gas cars.
EV adoption refers to how quickly electric vehicles are being purchased and used by consumers. It impacts the automotive industry's shift away from internal combustion engines.
clean sheet engine design
"We had one industry insider tell us they were worried that automakers would never do a clean sheet engine design ever again."
Clean sheet engine design means making a brand new engine instead of changing an old one.
A clean sheet engine design means designing a completely new engine from scratch rather than modifying existing engines. It allows for innovation but is costly and time-consuming.
hybrid setup
"Chinese automaker chan Gan just announced that it's about to launch an all new hybrid setup that was specifically developed for low speed efficiency like in stop and go traffic."
A hybrid setup means the car uses both gas and electric power to save fuel and pollute less.
A hybrid setup combines an internal combustion engine with an electric motor to improve fuel efficiency and reduce emissions, especially in stop-and-go driving.
fuel consumption
"By giving more priority to run on the electric motor, the company is aiming for fuel consumption of just under three liters per one hundred kilometers..."
Fuel consumption means how much gas a car uses to go a certain distance.
Fuel consumption measures how much fuel a vehicle uses to travel a certain distance, often expressed in liters per 100 kilometers or miles per gallon.
internal combustion engine (ICE)
"About half of the new car sold in China still featuring an ic JOBY Aviation hit a milestone."
An internal combustion engine is the usual engine in cars that burns gas to make the car move.
An internal combustion engine (ICE) is a traditional engine that burns fuel like gasoline or diesel to create power. It contrasts with electric motors in EVs.
FAA certification
"JOBY Aviation hit a milestone. It says it started flight testing the first versions of its aircraft. These initial flights paved the way for FAA pilots to test the electric vertical takeoff and landing aircraft..."
FAA certification means the government has checked and approved a flying vehicle to make sure it is safe to use.
FAA certification is the approval process by the Federal Aviation Administration to ensure aircraft meet safety and operational standards before commercial use.
Joby Aviation
"JOBY Aviation hit a milestone. It says it started flight testing the first versions of its aircraft. These initial flights paved the way for FAA pilots to test the electric vertical takeoff and landing aircraft or ev talls later this year."
Joby Aviation makes electric flying vehicles that can take off and land straight up, like a helicopter, to carry people in cities.
Joby Aviation is a company developing electric vertical takeoff and landing (eVTOL) aircraft designed for urban air mobility, including air taxi services.
electric vertical takeoff and landing aircraft (eVTOL)
"FAA pilots to test the electric vertical takeoff and landing aircraft or ev talls later this year. The Trump administration recently backed an ev TALL Integration Pilot program..."
eVTOLs are flying cars that use electricity and can take off and land straight up, like a helicopter.
eVTOL aircraft are electric-powered vehicles capable of vertical takeoff and landing, intended for urban air mobility and air taxi services.
Integration Pilot program
"The Trump administration recently backed an ev TALL Integration Pilot program that is helping clear the way for aircraft like this as well."
The Integration Pilot program is a government plan that helps new flying vehicles get tested and allowed to fly safely.
The Integration Pilot program is a government initiative to facilitate testing and integration of new aviation technologies like eVTOLs into the national airspace.
GLY electric big trucks
"Reuter's reports there are more than half a dozen Chinese automakers planning to launch electric big truck sales in Europe this year, including BYD and GLY."
GLY is a Chinese company making big electric trucks to sell in Europe that are cheaper than other electric trucks.
GLY is a Chinese automaker planning to enter the European market with electric heavy-duty trucks, competing on price against diesel and other electric trucks.
electric heavy duty trucks
"Chinese automakers... now they're gearing up to enter the electric heavy duty truck market... including BYD and GLY. Like the passenger evs, the Chinese companies are looking to undercut the price of electric big rigs..."
Electric heavy duty trucks are big trucks that run on electricity instead of gas or diesel.
Electric heavy duty trucks are large trucks powered by electric motors instead of diesel engines, aimed at reducing emissions and operating costs.
BYD electric big trucks
"Chinese automakers have quickly expanded and grown passenger car sales in Europe, and now they're gearing up to enter the electric heavy duty truck market. Reuter's reports there are more than half a dozen Chinese automakers planning to launch electric big truck sales in Europe this year, including BYD and GLY."
BYD is a company from China making big electric trucks that can carry heavy loads and are cheaper than other electric trucks in Europe.
BYD is a Chinese automaker expanding into the electric heavy-duty truck market in Europe, aiming to offer lower-priced electric trucks compared to existing models.
diesel truck
"Electric big rigs sell for an average of three hundred and twenty thousand euros or three hundred and eighty thousand bucks, but that's still well above a diesel truck, which sells for about one hundred thousand euros on average."
Diesel trucks are trucks that use a special kind of fuel called diesel to run their engines.
Diesel trucks use diesel fuel engines, known for their torque and efficiency in heavy hauling but produce more emissions than electric trucks.
Hyundai Palisade
"...ree in the US, unlike its counterpart, the Hondai Palisade, which is made in South Korea. Kia is adding a hy..."
The Hyundai Palisade is a large SUV made by Hyundai, a car company from South Korea. It has three rows of seats to carry many people and is designed for families or groups who need extra space.
The Hyundai Palisade is a midsize SUV introduced by Hyundai, known for its spacious interior, advanced technology, and value-oriented pricing. It is significant as Hyundai's flagship SUV in the US market, offering three-row seating and competing strongly in the family SUV segment. The Palisade is manufactured in South Korea, which is notable compared to some competitors built in the US.
horsepower
"The hybrid features a two and a half liter turbo with two electric motors that provide a combined three hundred and twenty nine horse power... The non hybrid version gets two hundred and seventy four horse power..."
Horsepower is a way to describe how strong a car's engine is. More horsepower usually means the car can go faster or pull heavier loads.
Horsepower is a unit of measurement for engine power, indicating how much work an engine can perform. The Kia Telluride hybrid produces 329 horsepower, while the non-hybrid version produces 274 horsepower.
turbo
"The hybrid features a two and a half liter turbo with two electric motors that provide a combined three hundred and twenty nine horse power and three hundred and thirty nine pound feet of torque..."
A turbo is a part that helps the engine make more power by pushing extra air into it. This makes the car faster without needing a bigger engine.
A turbocharger is a device that forces more air into an engine's combustion chamber, allowing it to burn more fuel and produce more power without increasing engine size. The Kia Telluride hybrid uses a 2.5-liter turbocharged engine.
torque
"...two electric motors that provide a combined three hundred and twenty nine horse power and three hundred and thirty nine pound feet of torque... The non hybrid version gets... three hundred and eleven pound feet of torque..."
Torque is how much twisting power the car's engine has. It helps the car start moving and pull heavy things.
Torque is a measure of rotational force produced by the engine, important for acceleration and towing capability. The Kia Telluride hybrid produces 339 pound-feet of torque, while the non-hybrid produces 311 pound-feet.
miles per gallon (mpg)
"The front drive version is rated at thirty five mpg with six hundred and thirty seven miles of driving range. Prices range from about forty six thousand, five hundred to fifty seven thousand, six hundred."
Miles per gallon tells you how far a car can go using one gallon of gas. A higher number means the car uses less gas and saves money.
Miles per gallon (mpg) is a measure of how far a vehicle can travel on one gallon of fuel. The Kia Telluride hybrid front-wheel-drive version is rated at 35 mpg, indicating good fuel efficiency for its class.
Intrepid Control Systems
"Intrepid we produce network hardware and software solutions enabling vehicle manufacturers to innovate and design the next generation of modern mobility... Intrepid's Coovi Cloud platform provides real time data collection, instant cloud upload, intelligent detection..."
Intrepid Control Systems makes special computer parts and software that help car makers test and improve their cars before selling them to customers.
Intrepid Control Systems is a company that produces network hardware and software solutions for vehicle manufacturers. Their products help with testing, validation, data logging, and remote updates to ensure vehicles are ready for production and road use.
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