Good morning! It’s Tuesday, July 30, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Trump Now Thinks EVs Are ‘Incredible’
Donald Trump has never been one to show much support for eco-friendly tech. While he was in office, he pulled the U.S. out the Paris climate accords and so far through his re-election campaign he’s pledged to scrap an electric vehicle mandate that doesn’t actually exist. Despite all this, he now appears to be changing his tune on the EV revolution. Or, more likely, he’s now lying about his views for political expediency.
During one of his latest campaign rallies, the convicted felon decided to pause his EV bashing to come out in support of some of the battery-powered cars being produced across American, reports the New York Times. The presidential hopeful went so far as to even suggest that he might quite like EVs, as the Times reports:
On Saturday, he went further, telling a rally in Grand Rapids, Mich., “I’m constantly talking about electric vehicles but I don’t mean I’m against them. I’m totally for them.” Moments later he said, “I’ve driven them and they are incredible, but they’re not for everybody.”
This subtle softening began after Mr. Trump met in March with Elon Musk, the billionaire chief executive of Tesla, in Palm Beach, Fla. The two men began frequent discussions on a range of topics, including conversations about electric vehicles, according to comments Mr. Musk made last month at a shareholders meeting. “He just called me out of the blue,” Mr. Musk said. “I don’t know why, but he does.”
As spring turned to summer, Mr. Trump shifted his attacks from the reliability and value of electric vehicles to the federal incentives for consumers to buy E.V.s, and to environmental regulations designed to prod automakers to step up production. He’s said that anyone who wants to buy an electric vehicle should be able to but the government should not shape the car market.
The shift in attitudes from the presidential hopeful comes mere weeks after Tesla boss Elon Musk pledged his support, and millions of dollars, to Trump’s campaign. Reporters soon stepped in to ask Musk what he thought of Trump’s softening towards EVs, with the Tesla boss reportedly saying that he “can be persuasive,” reports the Times.
Despite these shifting perceptions towards EVs, Trump’s campaign still leans heavily on a desire to go back to the way things were when it comes to traveling around America. Trump previously called for an end to subsidies offered on EVs by the current administration, a move that was, weirdly, welcomed by Musk.
One expert told the Times that Trump’s hatred of such policies are all to do with the man that implemented them: Joe Biden. His war against EVs is seen as much as a war against the legacy of the Biden administration as it is a fight against the tech.
2nd Gear: EV Makers Won’t Hit Their Targets
While Trump’s sentiment towards EVs might have softened, the American public’s has been slow to catch up with expectations. This means that EV targets for automakers across America are beginning to slip.
Slowing sales, higher prices for electric models and the turbulent political landscape all mean that automakers are pushing back EV targets and delaying their switch to fully batter-powered lineups, reports Automotive News. As the site explains:
A once clear vision of a rapid transition to an electric vehicle future has blurred. While industry analysts and automakers still see EVs eventually replacing gasoline-fueled autos, cooling sales growth, high vehicle prices and uncertain political outcomes have forced automakers to pivot.
The site has tracked EV targets at automakers across America and found that almost every one has tempered ambitions. At GM, the target had been for most, “if not all” Cadillac models to be electric by 2030, now gas-powered cars will remain at Caddy past that deadline. At Ford, EV launches have been delayed this year and the Blue Oval has gone so far as to push some production away from EVs and back towards gas-powered and hybrid models.
The same is true across the pond in Europe, where Volvo renewed its support for hybrid models and Volkswagen has suggested taking billions of dollars from funding marked for EVs to support development of new hybrid options.
There’s no surprise that hybrids are the hot ticket item for the world’s automakers. Toyota has proven through strong sales for models like the Prius that more and more people are looking to hybrid options to bridge the gap between our current reliance on gas-power and the impending switch to zero emissions.
3rd Gear: Toyota Output Drops As Sales Falter
Not everything is rosey at Toyota, however, and the Japanese automaker has seen production slow as a result of declining sales of certain models around the world. According to a report from Reuters, Toyota dropped its output by around 13 percent as sales were hit by scandals in Japan and issues across China.
The Japanese automaker produced 795,862 vehicles in June 2024, which marked a 12.9 percent drop over the previous month. The drop marked Toyota’s sharpest decline since December 2022, Reuters explains. According to the site:
In its home market, output plunged 18.8% after the transport ministry found irregularities in applications by Toyota and other automakers to certify certain models in a widening of an auto safety scandal.
In China, where domestic electric vehicle makers like BYD (002594.SZ), opens new tab have rapidly gained market share and have aggressively cut prices, production fell 21.7% – marking the fifth month in a row where Toyota’s output has declined by 20% or more.
Production in North America fell 6.2% while in Europe it dropped 6.6% due to fewer production days compared to last year.
Toyota’s worldwide sales fell 5.1% during the month, hurt by declines in Japan and China.
Despite a drop in production around the world for Toyota, the Japanese automaker isn’t projected to suffer too much in its latest financial results, which are due later this week. Experts are projecting a 21 percent rise in operating profit compared with the same period last year, reports Reuters. The boost is thought to be as a result of a weaker yen and “robust demand for hybrid vehicles in the United States,” reports the site.
4th Gear: Mercedes Profits Drop As EV Sales Fall
While Toyota is able to soak up the dip in production, a slowdown in demand at Mercedes is having more dramatic impacts on the German automaker. Slowing EV sales at Mercedes-Benz and weaker demand in China have contributed to a 19 percent drop in profits for the German brand, reports Automotive News.
For the second quarter in 2024, sales of Mercedes cars were down 3.7 percent to 496,700 units in the three-month period, reports Automotive News. The dip was impacted by a massive decline in fully-electric models, which fell by a quarter in Q2. As the site reports:
Mercedes-Benz’s earnings fell 19 percent in the second quarter as sales of its full-electric vehicles dropped sharply and demand in China weakened.
Earnings before interest and tax fell to €4.04 billion ($4.4 billion) in the quarter compared with a year earlier, Mercedes said.
Mercedes now expects returns in a range of 10 percent to 11 percent from its core automaking business, after previously saying margins could be as high as 12 percent. The cars division achieved a 10.2 percent margin in the second quarter.
Looking ahead to the remainder of the year, Mercedes bosses are hopeful that hybrid models can fly in and rescue the automaker. As well as working on next-generation EVs, Mercedes has a slew of plug-in options that it thinks will contribute to a rise in sales across Europe and America through the remainder of 2024.
