Newsletter · · Ashutosh Agarwal
Ford Loses $1.3 Billion and Its Stock Jumps While Detroit Pivots Batteries to AI Power - The Auto Disruption - Week of August 3, 2026
A synthesis of what auto-industry podcasts said for the week of July 27 to August 3, 2026, including Ford's $1.3 billion loss and second guidance raise, Detroit repurposing failed battery plants for AI data-center storage, Amazon's Zoox winning the first paid-ride exemption, and BYD drawing level with Tesla in Europe.
The Auto Disruption
Week of July 27 to August 3, 2026: Ford Loses $1.3 Billion and Its Stock Jumps, While Detroit Turns Dead Battery Plants Into AI Power Stations
Last week General Motors showed us the strangest trick in the car business: lose billions on electric cars, make even more on trucks, and raise your profit forecast anyway. This week it was Ford's turn to run the exact same play, a $1.3 billion quarterly loss, a stock that went up, and a second guidance raise of the year. The pattern is now so clear it has a rhythm to it. The old Detroit companies are quietly minting money selling big gasoline SUVs and pickups, taking their medicine on the electric cars nobody's buying, and, the newest twist, turning the half-empty battery factories they built for an EV boom that never arrived into power plants for AI data centers. Meanwhile Europe kept bleeding (BMW is cutting 8,000 jobs and blaming China, Volkswagen's Audi division watched its profit margin fall from 16% to barely 3% in four years), Japan's carmakers got hit by a real earthquake, and the cheapest, fastest-moving car companies on earth, the Chinese, passed Tesla in Europe for the first time.
The driverless-car story also roared back to life this week, and the company that made the biggest breakthrough wasn't Tesla. It was Amazon.
Here is what the people who run these companies, and the journalists and analysts who cover them, actually said this week.
1. The split screen, part two: Ford loses $1.3 billion, and Wall Street loves it
If you only read the headline number, Ford had an ugly quarter. On Automotive News Daily Drive (Jul 29), the hosts laid it out: "Ford posted a $1.3 billion net loss in the second quarter." But almost all of that loss came from two one-time accounting charges, money the company admitted it will never get back. As Ford reporter Michael Martinez explained, the loss "was driven by charges tied to scrapping its Blue Oval SK battery joint venture and canceling a pair of electric crossovers for its Oakville plant in Canada. Strip those out and the picture looks different. Adjusted earnings rose 17% on strong pricing and favorable vehicle mix. Ford has now raised its full year earnings guidance twice to between $10 billion and $11 billion." (On Autoline Daily (Jul 29), host John McElroy put a precise figure on the write-off: a "$3.6 billion write down of its battery joint venture with SK.")
The market reaction tells you everything. On The Rundown (Jul 29), host Zaid Admani summed up why investors cheered a loss: "the old-school automaker delivered a beat and raised their guidance for the second time this year… total revenues for the quarter were down 4%… coming in at $48.3 billion. But investors were more focused on the profit number. Ford's adjusted operating profit came in at $2.5 billion, which beat Wall Street estimates." The mechanics were, in his words, "very similar to what we heard from GM. Just like with GM, Ford is actually selling less cars. In fact, vehicle sales dropped 10% last quarter. But Ford sold a ton of high-margin cars like the Bronco and the Explorer. Americans keep buying the big, expensive gas-powered SUVs, especially the expensive off-road versions with all the extra packages." Ford shares rose roughly 6% the morning after, and are up about 35% over the past year.
The electric side, meanwhile, is still deep in the red. Ford's "EV sales dropped 41%, and the EV unit as a whole lost about $1.3 billion for the quarter. Ford expects to lose roughly $4 billion in total on EVs this year," Admani reported. (One catch on the F-150: the pickups were actually in short supply for part of the year. On Autoline Daily, McElroy noted vehicle sales fell "primarily due to discontinued models like the Ford Escape and due to production shortages with the F-150 because of an aluminum shortage," which means the profit could actually get better as trucks come back.)
The genuinely new idea this week is what Detroit is doing with its failed battery plants. Both Ford and GM built giant battery factories a few years ago, betting on an electric boom that hasn't come. Rather than eat the loss, they're repurposing those plants to make batteries for stationary energy storage, the massive battery banks that data centers and power utilities use to keep the lights on, and that are suddenly in huge demand because of the electricity AI consumes. On Automotive News Daily Drive, Martinez said Ford is "pretty optimistic that they can turn a profit there eventually… in late 2027, early 2028, they intend to start pumping out batteries for energy storage businesses. They already have one contract signed. Jim Farley, the CEO, said they're talking to a wide range of businesses, utilities, data centers, things like that… this was both in Michigan and Kentucky. These were battery plants they were going to lose money on after this EV pivot. And they've turned it into a source of income by changing the business strategy." On Bloomberg Intelligence (Jul 29), analyst Craig Trudell made the same point about both companies: they "built battery plants expecting higher EV demand under the Biden administration but consumers were not ready to buy electric vehicles at projected rates, forcing companies to explore alternative uses for battery plants such as energy" storage. Ford's stock is up sharply this year largely because of this pivot; on Autoline Daily (Jul 31), the hosts noted one analyst, City's Michael Ward, went so far as to raise his Ford price target to $20 a share (the stock was around $14.83), citing the energy business and a "28% boost in F-Series production in the second half."
Not everyone thinks lurching from strategy to strategy is healthy. On the Automotive News Daily Drive Weekend Drive edition (Aug 1), Toyota reporter Larry Valiquette gave Ford credit for "turning what was clearly not Mr. Right into Mr. Right now," but warned about the whiplash: "The thing that is worrisome is it all seems very reactive to me… it's these pivots from quarter to quarter. We're going to change strategy… we're going to throw away the strategy that we laid out four years ago because the administration changed and now everything's changed. The problem is, is that administrations change and everything changes." He also flagged the obvious risk: Ford is charging into "a very crowded segment… going up against some real large battery makers globally. And power is a completely different industry… one where they do not have the expertise that other players do." The quieter, more durable part of Ford's story is software: Martinez noted Ford now has "1.6 million paid subscription customers today. That's up 50% year over year. So they're making real money at that," the same subscription-revenue bet GM's OnStar business represents, which last week's panel argued about so heatedly.
Stellantis, the maker of Jeep, Ram, Chrysler and Peugeot, showed the flip side: a genuine recovery. On the same Weekend Drive, host Kellen Walker reported Stellantis "swung to a 293 million euro profit in the second quarter, a massive turnaround from the nearly 1.9 billion euro loss a year ago. North America led that rebound. Ram 1500 demand was a big driver." (Autoline Daily (Jul 30) put more numbers on it: 1.6 million vehicles sold, up 10%; revenue of €43 billion; adjusted operating profit of €773 million, up 263% from a year earlier.) Valiquette, who covers the company, called it real but fragile: "This global automaker just fell… flat on its face. And it's picking itself up." His warning was about what is driving the comeback, a handful of very expensive machines like the Ram SRT TRX, "an almost $103,000 pickup. That's problematic if that's what you're counting on… they cannot rely on these very few high profit machines. It's not a virtuous cycle for them long-term." And the recovery hasn't reached the factory floor: Martinez noted Stellantis workers' profit margin for the first half was 1.6%, "still under the threshold that would give workers profit sharing checks." One telling contrast: while Ford and GM are expanding into side businesses like energy and subscriptions, Stellantis under CEO Antonio Filosa is doing the opposite, selling off its Free2Move car-sharing service to "focus only on the core," which Martinez called "exactly what they need to do."
Everywhere outside North America, though, the news was grim. BMW is launching a voluntary buyout program that "could eliminate around 8,000 jobs globally," most of them white-collar roles in Germany, Automotive News Daily Drive reported, and the trigger was blunt: "a June profit warning tied to slumping China sales, where competition from local EV makers has intensified." Volkswagen's Audi division, once a money machine, released quarterly numbers that McElroy on Autoline Daily (Jul 27) called "all going in the wrong direction": sales down more than 8%, revenue down more than 12%, and an operating profit margin "now barely over 3%. Remember, only four years ago, Audi's profit margin was over 16%." Audi workers know what's coming: McElroy reported nearly 6,000 of them protested this week against the possible closure of the Neckarsulm plant, "just one of four plants in Germany that could close by 2030."
And Japan got hit by something no strategy can fix: a 7.1-magnitude earthquake. Automotive News Daily Drive reported Toyota "extended its Lexus production shutdown… affecting up to 5,200 vehicles, including the RX and NX crossovers," Nissan "suspended operations at two Kyushu plants, citing interrupted parts supply," and Honda "halted a motorcycle plant in the region." The bigger worry is the parts network: "Supplier disruptions may outlast the factory shutdowns." One side effect of everyone's shared pain: McElroy reported Nissan and Honda are reviving the software partnership they abandoned in 2024, because "now that Honda is hurting from all its EV write-offs, it's become a lot more amenable to sharing power."
2. Robotaxis finally had a week, and Amazon, not Tesla, got the golden ticket
For months the driverless-car story has been mostly promises and slow, careful expansion. This week it produced three concrete milestones, and the biggest one belonged to Amazon.
The headline: a robot can finally charge you for a ride, and it's Amazon's. On Autonomy Markets (Aug 1), a podcast run by media-and-tech analysts at LightShed Partners, the hosts could barely contain themselves: "Zoox called up Willy Wonka and they got the golden ticket… after 12 years, Zoox is 12 years old. They can finally charge for a ride." Zoox is Amazon's self-driving arm, and its car is unusual, no steering wheel, no pedals, four seats facing each other, "basically a shiny box on wheels," as Marketplace (Jul 31) described it. On Autoline Daily (Jul 31), the hosts explained the significance: "Zoox announced that it's the first company to receive an exemption from NHTSA [the U.S. federal auto-safety regulator], allowing it to charge for rides in its robo-shuttle, which has no driver controls. Those paid rides start in Las Vegas next month and then will expand to California."
There's a catch, and it's the number to watch: a cap. The regulator is letting Zoox put out "2,500 vehicles per year for two years so they can get up to 5,000," the Autonomy Markets hosts explained. That same cap, they noted, would apply to Tesla's purpose-built Cybercab, and that sparked the most interesting disagreement of the week. One host worried it could be a bad sign for Tesla: "if you're now getting handcuffed… is this an inkling of them potentially getting handcuffed by this new thing?" His co-host disagreed, arguing the cap is just a starting gate that will disappear once the industry agrees on a national safety standard (a "best practice" being written through an engineering consortium): "once the industry buys into the standard, and then it is recognized by NHTSA and the federal government, the 2,500 cap per year will go away." For perspective, they pointed out that Waymo, the clear leader, operates "roughly around 3,000" vehicles today, so a 5,000-car allowance over two years is "quite a big number."
Milestone two: Waymo is divorcing Uber. Waymo (Google's self-driving company) has been offering rides through Uber's app in Austin and Atlanta. This week the Financial Times reported, and both companies confirmed, that it's ending. On Autonomy Markets, the hosts described "the messy divorce" going public, with each side airing grievances: "Waymo talking about dirty cars… but also bad routing" (those viral clips of Waymos circling a cul-de-sac? "apparently those cars were sent there by Uber"), while Uber complained the cars don't "work in weather" and generate "weather no-shows in unsustainable financial terms." The plan is for Waymo to launch its own app in Austin and Atlanta by January 2028, with the contract ending by May 2028, though both hosts bet it ends sooner. On Autoline Daily (Jul 27), McElroy called it "a big blow to Uber's robo-taxi efforts," noting Uber's stock is down 20% this year and its other self-driving partners are "much smaller than Waymo's." Why does Waymo have the leverage? The Autonomy Markets hosts put hard numbers on the gap: Waymo will have around "10,000 in 30 markets" within a year, while the combined fleets of Uber's various self-driving partners, even counting cars that still have a human safety driver, will be "less than 1,000." Their verdict: Uber's partners are "at least three years behind" Waymo, both on the technology and on winning regulators' approval.
Milestone three: Tesla did a rolling publicity stunt, and expanded, barely. On The Road to Autonomy (Jul 31), the hosts recounted a record-setting drive: a team led by well-known Tesla tester David Moss drove a Model 3 from New York to Redondo Beach, California, "in a record setting 47 hours, 15 minutes and 39 seconds… using FSD supervised version 14.3.6," that is, the car drove itself the whole way with "no hands on the wheel" (a human was present to supervise). The hosts argued this is a real advantage for Tesla's approach, because unlike Waymo and Zoox, which rely on cars that are pre-mapped and locked to specific city zones, Tesla's system "doesn't rely on mapping" and so can drive almost anywhere, and the stunt is "a giant marketing banner" that competitors "can't invent" on their own.
But the reality on the ground is more modest, and a Tesla fan said so plainly. On the Chuck Cook Podcast (Aug 2), Cook, a veteran independent tester of Tesla's Full Self-Driving software, noted the company "expanded Robotaxi to Orlando and Tampa with just a handful of vehicles," and was candid that it was timed to the earnings call rather than to real readiness: "if they hadn't promised how many they would have launched by first half of 2026, even though they missed it… they wouldn't have launched those cities. Because they're waiting on either V15 [the next software version] or wider regulatory approval." He doesn't think the new software is ready ("I don't think V15 is ready. I don't think it's out of training"), and, remarkably for an enthusiast, he spent much of the episode cataloguing the car's real limitations over a 2,400-mile road trip: it kept "camping out in the left-hand lane," its parking was poor, and it repeatedly botched lane choices ("in the 20 to 25% range for me, it gets boxed out and can't get over"). His plea to Tesla was telling: "until we're unsupervised, I need some control."
And the sober reality check. Marketplace gave the clearest cold-water summary of why "several thousand" robotaxis is not the same as "solved." As Missy Cummings of George Mason University put it: "there is no such thing as a self-driving car. All of these vehicles require extensive human supervision, just not in the cars." Teams of people, in some cases overseas, monitor the cars remotely and take over when they get stuck, and that is expensive: "It's still not clear whether one self-driving car with one passenger and a remote operator supervising it is really going to scale in terms of cost." The other unsolved problem is weather: today's robotaxis are "deployed in warm weather environments like California, Texas, Nevada," and still struggle with "snow, rain, and fog."
One more signal worth filing away: the rest of the world is racing too. On The Road to Autonomy, the hosts reported China's Baidu began testing its RT6 robotaxi (a car priced at roughly "$30,000 per unit") on both Uber's and Lyft's networks in London this week, making London "the Olympics of driverless vehicles," with Britain's own Wayve, China's Baidu, and America's Waymo all testing there at once. And on Autoline Daily, the hosts noted that in Germany, the Chinese company Momenta became "the first Chinese company to get approval… to test Level 4 autonomous cars nationwide," helped, they think, by its partnerships with Mercedes, BMW and the Volkswagen Group. The autonomy race is no longer just Waymo versus Tesla in a few American cities.
3. Why so many people can't buy a car, and the surprising thing they're buying instead
All those EV write-downs trace back to one stubborn fact: ordinary buyers are stretched thin, new cars are expensive, and the market keeps splitting into people who can pay up and people who've been priced out entirely. This week added a genuinely counterintuitive wrinkle: used electric cars are getting more expensive.
Used EV prices are rising, which almost never happens. On Automotive News Daily Drive (Jul 27), Andrew Garberson, head of research at the used-EV data firm Recurrent, explained the surprise: comparing June prices to January, used EV prices "rose by 5% on a weight adjusted basis. And some of the models on the more affordable end jumped 20% since January." What makes that bizarre is that it's happening at the same time as a flood of supply: "500,000 plus leased EVs are going to return to the used car market this year." Normally a flood of supply pushes prices down. Instead they're rising, and the cheapest cars are selling almost instantly. A 2023 Chevy Bolt now sells "within 12 days," versus about six weeks for the average used car, and the fastest-selling used EVs "all start with a two on the used market," meaning $20,000–$28,000 cars. Even the discontinued F-150 Lightning pickup sells "in a little over 12 days on average with a price tag of about $44,000."
Why? Partly gas prices, and here the auto story connects to the wider world. A flare-up of conflict involving Iran pushed oil sharply higher this summer, Brent crude was "trading back above $90 a barrel," The Rundown noted, and that's nudging cost-conscious buyers toward electric. Garberson told a story that captures it: one longtime F-150 owner "took their truck to the gas station… and the pump shut off at $200 because that was the limit for the credit card. And they turned to their spouse in the car and said, I'm done. I'm out… a week later, they were driving an F-150 Lightning." The last time used EV prices rose like this, he noted, was 2022, right after the invasion of Ukraine spiked fuel costs.
Lucid got a lifeline, but the clock is still ticking. The struggling luxury-EV maker Lucid had spent last week fending off bankruptcy rumors, with its stock down 58% for the year. Then, as Autoline Daily (Jul 29) reported, "a Saudi prince, Al-Walid Bin Talal Bin Abdulaziz, bought 5% of the company," a billionaire "often called the Arabian Warren Buffett," and "Lucid stock had shot up 24%." (The Smashi Business Show (Jul 29) pegged the stake at about $129.5 million, roughly 19.5 million shares at around $8 each.) But on The EVs for Everyone Podcast (Jul 27), Bloomberg's Detroit Bureau Chief David Welch explained why a rescue is not a cure. Lucid is "burning… about a billion dollars a quarter," and at the current rate is "going to run out of money about the second half of 2027." Its majority owner, Saudi Arabia's Public Investment Fund, keeps topping it up (it just put in "about a billion… 900 million"), but Welch warned the fund is not a bottomless well: it once put "$5 billion" into the LIV golf tour and then "pulled out… when that started falling apart." Lucid's plan is a cheaper mid-size SUV, the Cosmos, at "$50,000 or $60,000," but Welch was blunt about the math: "that's tough to make money on those in that space too." His larger point was a warning about the whole pure-EV business model: "I would not have gone as a pure play EV company," because it "was reliant on the Biden administration putting out… incentives… and if businesses have learned anything in the U.S., it's that you can't rely on anything from the government." He compared 2026 to 2005, oil spiking, Detroit leaning on trucks, EVs retreating, right before the crisis that eventually bankrupted GM and Chrysler.
Rivian is the counter-example, and the next six months will decide it. Rivian, the other big EV startup, reported a quarter its fans could actually cheer. On Electrek (Jul 31), the hosts walked through the numbers: revenue of "1.658" billion, "up 27% year over year," a narrower loss of "0.63 cents per share," and, the number that matters most for a carmaker, a gross margin (the profit left after paying to build the cars) of "11% this quarter with a positive $179 million." The honest caveat: most of that profit came from selling regulatory credits ("$100 million") and a software deal with Volkswagen; on pure car-building, Rivian was still down "about… $140 million." But that's a big improvement, a year ago it was "down $260 million," while delivering only about 12,000 vehicles. The whole story now rests on the R2, Rivian's cheaper mid-size SUV. Rivian raised its full-year delivery target to 65,000 vehicles, which means it has to deliver "40,000 vehicles instead of 22,000" in the back half of the year, it has to roughly double. As the hosts put it: "If you know someone that works at Rivian, wish them good luck. They're not going to see their kids… a lot of the second half of the year." If they pull it off, they said, Rivian could hit "positive gross margin… start making money on their cars," which "changes the whole financials." (One reality check from their real-world testing: the R2 used "18% more energy" than a Tesla Model Y at 50 mph and "26% more" at 60, a reminder that Rivian's boxy, off-road-focused vehicles still trade efficiency for capability.)
4. China won't stop, and Europe is now the battleground
Every write-down, every job cut, every retreat above ties back to the same pressure: China builds good cars more cheaply and more quickly than anyone else, and this week it planted its flag deeper in Europe than ever before.
The milestone: BYD passed Tesla in Europe. On ev.news (Jul 29), host Martyn Lee reported that in the first half of 2026, BYD "more than doubled its share of European car markets… and it drew level with the leader, Tesla," with both at 2.4% (BYD up from just 1% a year earlier). In raw registrations BYD actually edged ahead, "the gap is fewer than 4,000 units," driven largely by its plug-in hybrids (cars that run on a battery but also have a gasoline engine as backup). And BYD isn't the only one: Chery, another Chinese brand, "quadrupled its market share to 2.2%," with its Jaecoo 7 becoming "the UK's best-selling car in March." Lee's blunt explanation for why buyers are choosing unfamiliar Chinese badges: "we're all skint. That's why… you can get a lot of car for not a lot of money." BYD's UK growth shows the pace: on ev.news China (Aug 2), Lee reported BYD "topped 100,000" total UK registrations in the three years since it launched there, growing from "five partners at launch to 143 retail locations," with "almost 38,000 UK registrations in the first half of this year alone."
The scale of the ambition became clear in Munich. The richest discussion came from China EVs & More (episode #254, Jul 28), whose hosts, long-time China-auto analysts Tu Le and Lei Xing, attended XPeng's launch of its Mona L03, a compact electric SUV, at a packed 1,500-seat theater "right next to the Allianz Stadium where FC Bayern Munich plays… in BMW's backyard." Lei Xing called it "the biggest product launch in the history of XPeng," and the pricing revealed the whole game: the car starts at the equivalent of "$18,000" in China but "$35,600" in Germany, double. Even at that markup, the hosts said, €35,000-ish "is a good price point for this type vehicle," aimed squarely at Volkswagen's mass-market cars. XPeng plans to build "4,000 [charging] stations by 2028" in Europe and, tellingly, is exploring "producing XPengs at one of the idle plants" of its shareholder Volkswagen. The backdrop is BYD's stated goal, reaffirmed this week by its executive Stella Li, "to be number one" automaker, a target of 10.5 million vehicles a year by 2030. Tu Le's own math is that BYD sits at roughly "8% of global market share" today and would need to reach "20%," which, without access to the closed U.S. market, means it needs "13 factories" and to "own 25% to 30% share" in markets like Japan, Australia and India. Both hosts stressed that Canada is now firmly in the crosshairs: XPeng's overseas chief confirmed "the Canadian and the U.S. are their strategic markets and the discussions are ongoing for Canada."
The competitive threat, explained. The clearest big-picture framing came from What's Next For Markets (Jul 31), where Piper Sandler auto analyst Alex Potter described how fast it's happening: "There's three Chinese car companies who… two years ago were a complete non-factor in Europe. And by the end of this year, it'll probably be just those three companies alone will probably be one out of every 10 cars sold in Europe. And it's just every month, literally just up and to the right… like 50 basis points, 75 basis points, 100 basis points. And all of that share is coming out of Volkswagen's pocket or Peugeot or Citroën… A hundred thousand of you are fired. It's crazy how quickly it's unfolding." His key insight is that the Chinese edge isn't only cheap labor, it's a different way of building cars, "a lot more like Tesla": vertical integration, in-house chips and software, and "launching a new product every 12 months instead of every six years." He thinks the U.S. is "a walled garden" protected by tariffs, but that the dam will eventually leak: Ford's own CEO Jim Farley "expects within 10 years there'll be Chinese cars in the U.S." Potter's warning is that this "goes beyond the auto industry": "our supply chains, auto and otherwise, are completely beholden to Chinese manufacturing… we no longer control the means of production."
A dissenting note worth hearing: are the Chinese even making money? On the Car Stuff Podcast (Jul 28), veteran auto journalist Jamie Butters pushed back on the idea that China's rise is unstoppable and healthy: "China is a huge competitive threat, but almost none of those companies make money. They have a really grossly overcapacitized market, and they need to dump those vehicles on other markets and cause trouble for Europe." He and the hosts pointed to the heavy government aid, "not only the federal government over there, but from prefectures and states and even cities," propping up companies that can't stand on their own. That episode also covered a deal that captures the strangeness of the moment: Ford is going to let China's Geely build cars in Ford's underused Valencia, Spain plant. Butters was ambivalent, Geely "doesn't need more capacity… they're almost doing this as a favor for Ford," but noted the bigger dynamic, echoing a UAW worker who told President Trump at a Michigan event this week: "As long as they make it here, if they wanna sell here, they gotta make it here."
And the Chinese are now going upmarket and evolving, not just going cheap. Two data points this week showed the range of the assault. First, luxury: on EV News Daily (Jul 28), the show reported BYD's premium sub-brand Denza launched its Z9 GT in Europe at "£105,000 for the EV version and £95,000 for the plug-in hybrid in the UK" (and €115,000 in Germany and France), "more than three times the Chinese starting price," a Chinese car deliberately priced against Porsche and Mercedes, boasting a 600-km range and "70% rapid charging in five minutes." Second, adaptation: on ev.news China, Lee reported Xiaomi, the phone giant turned carmaker, opened pre-sales for its first range-extender vehicles, the Sky Nomad line (a range-extender, or EREV, is an electric car with a small gasoline engine on board just to recharge the battery), pitched at the top of the range: "The N70 Max is 260,000 yuan. The N90 Max is 300,000 yuan." Notably, Chinese makers like Xiaomi and Li Auto are even stretching oil-change intervals "to three years or 30,000 kilometres" to make these part-gasoline cars as low-maintenance as pure EVs.
Which is exactly why the Europeans are now begging for protection. On Autoline Daily (Jul 27), McElroy reported that Volkswagen Group CEO Oliver Blume "is demanding that the EU immediately put higher tariffs on imported Chinese plug-in hybrids," because Europe's existing tariffs only cover pure-electric cars, and "Chinese automakers have captured over 28% of plug-in hybrid sales in Europe this year," with the top three sellers all Chinese. The irony McElroy highlighted is sharp: "Volkswagen strongly opposed any tariffs on Chinese EVs when that vote came up in 2024. And Germany voted against them. But now that VW is facing up to the fact that it's got to close four assembly plants in Germany and get rid of 100,000 German workers, it suddenly sees the wisdom in applying tariffs." And Blume's problem is political: he "needs at least 10 other EU members to approve," and the countries without their own car factories would rather have cheap Chinese cars than protect German jobs. The pressure isn't going away: on ev.news (Aug 2), Lee cited Mercedes CEO Ola Kallenius warning that China's price war "will last for years and is now reaching the premium market."
What we're watching
- Whether Detroit's AI-power pivot is real money or wishful thinking. Ford and GM have reframed their money-losing battery plants as future power-storage businesses for data centers, with profits promised for 2027-2028. As Larry Valiquette warned on Weekend Drive, it's a "reactive" bet into "a completely different industry" where the automakers have no track record. Watch for the first real revenue, and whether any of the signed contracts turn into meaningful sales.
- The 2,500-car cap. The single most important number in the robotaxi world right now is the federal cap on how many driverless cars Zoox (and eventually Tesla's Cybercab) can put on the road. If it disappears once a national safety standard is agreed, as the Autonomy Markets hosts expect, scaling gets much easier. If it sticks, it's a ceiling on the whole industry.
- Rivian's second half. Rivian must roughly double its deliveries, from 22,000 to about 40,000, to hit its full-year target and reach the break-even point on building cars. This is the make-or-break stretch for the most credible American EV startup left standing.
- Lucid's cash clock. A Saudi prince's 5% stake bought a jolt of confidence, but Bloomberg's David Welch says the company still burns about $1 billion a quarter and runs low on cash around the second half of 2027. Watch whether the cheaper Cosmos SUV can slow the burn, and whether the Saudi fund keeps writing checks.
- BYD in Europe, and Canada next. BYD drawing level with Tesla in Europe is a line that won't un-cross. The next tell is North America: both XPeng and BYD have now named Canada a strategic market, and a Chinese factory on the continent would be the clearest sign yet that tariffs relocate Chinese production rather than stop it.
- Whether Europe can actually raise its tariff wall. VW's Oliver Blume needs 10 other EU governments to agree to tariffs on Chinese plug-in hybrids, the same tariffs VW opposed in 2024. If he can't get them, the "one in every 10 cars" that Alex Potter expects Chinese brands to sell in Europe this year is just the beginning.