+++ Sales of the BMW Group (BMW, Mini and Rolls-Royce) in the first quarter (Q1) of 2022 fell by 6.2 percent year-on-year to 596,907 units, the German carmaker said on Thursday. Sales of the group’s core brand BMW even fell 7.3 percent to 519.796 vehicles. Sales of the Mini brand were slightly up, while the luxury brand Rolls-Royce recorded significant growth of 18 percent. In the United States, BMW and Mini deliveries increased by 3.7 percent to 80.590 units, while in Europe, combined sales declined by 7.8 percent to 220.076 units, according to the company. BMW sold 208.507 vehicles in China in Q1. Sales of fully-electric vehicles also “performed well” and were up 207.9 percent year-on-year, it noted. Registering an increase of 149.2 percent, global sales of fully-electric BMW and Mini vehicles in Q1 more than doubled compared to the same quarter of last year. The carmaker aims to achieve similar growth rates in 2022. +++
+++ Although Chinese automaker BYD (Build Your Dream), which is backed by legendary investor Warren Buffett, has announced it has stopped producing traditional fossil fuel-powered vehicles since March, its production shift entirely to electric cars and plug-in hybrids is a natural progression, given that new energy vehicles dominate the company’s sales figures. Yet, gasoline vehicles are expected to take the lion’s share in the overall vehicle market for some time to come, said analysts. In the first 2 months of this year, BYD’s new energy vehicle sales soared 494 percent to 181.451 units, giving the company the No 1 position in the Chinese NEV market, according to the company’s filing with the Shenzhen Stock Exchange. In contrast, BYD sold 5.049 gasoline vehicles or 2.7 percent of its total deliveries, a far cry from the 18 percent, or 136.348 gasoline vehicles, for the whole of last year. Roy Lu, an independent auto analyst in Shanghai, said, “BYD’s decision to make only NEVs is not applicable to others in the industry, at least not for the time being”. Lu also said BYD is less competitive in the gasoline car segment compared with other local marques like Changan or Geely, let alone international ones, but it leads them all in NEV sales. The Shenzhen, Guangdong province-headquartered BYD, now the world’s first carmaker to quit the fossil fuel-powered vehicle segment, said on Sunday it will continue to produce and supply components for existing owners of such cars and provide service and after-sales guarantees to them. NEVs accounted for 19 percent of China’s market of 4.27 million units in the first 2 months, data from the China Association of Automobile Manufacturers showed. Zhang Xiang, a researcher at North China University of Technology in Beijing, said, “So, by getting relieved of the burden of gasoline vehicles, BYD is highlighting its transition from a carmaker to a ’technology company’ like popular startups Tesla and Nio did in the past”. In China, Tesla is BYD’s major rival, usually the runner-up since it runs a local production unit in Shanghai. Chinese startups from Nio to Xpeng are also seeing their monthly sales grow to exceed 10.000 units, with the introduction of more models and growing trust from tech-savvy car buyers. Zhang Hong, an official at the China Auto Dealers Association, said BYD’s expertise is mainly in NEVs and its plug-in models have been in short supply. “So, it’s not surprising for BYD to make the decision to produce only NEVs from now on”. Different from electric cars, plug-in hybrids can run on both gasoline and electricity. In a filing with the Shenzhen Stock Exchange, BYD said its DM-i technology has enabled its models to have a range of over 1.000 kilometers on a single full charge and thus help it to explore the market where charging facilities are few. Despite BYD’s moves, other carmakers have not released plans to follow suit. They are not in a position to stop production and sales of gasoline cars, although they have ambitious plans to electrify their vehicles. China’s largest SUV and pickup truck maker Great Wall Motors said vehicles with at least some form of electrification will account for 80 percent of its deliveries by 2025. Last year, the figure was nearly 11 percent of its total sales. Geely, which owns Swedish carmaker Volvo and shares in Mercedes-Benz, saw NEVs account for a mere 7.5 percent of its 1.33 million unit deliveries in 2021. The China Association of Automobile Manufacturers said it expects NEV sales this year to reach 5 million vehicles in the country, up from 3.5 million units in 2021. That would account for around 18 percent of an estimated 27.5 million vehicles to be sold in China, the world’s largest NEV market, said the association. +++
+++ CHINA ’s production and sale of new energy vehicles are expected to double and take 65 percent of the global market in the first quarter of this year. China’s new energy passenger vehicles maintained continuous rapid growth despite the negative effects from the epidemic, chip shortage and lithium price rise, said Cui Dongshu, secretary-general of the China Passenger Car Association. Chinese automaker BYD announced on Sunday that it had stopped producing traditional fossil fuel-powered vehicles since March. The company set a new monthly sales record for a Chinese new energy vehicle maker with sales of more than 104.300 units in the same month. Another 5 new energy vehicle start-ups recorded over 10.000 units monthly sales, more than doubling their growth rate year-on-year, the report said, citing the monthly reports announced on April 1. GAC Aion’s factory completed capacity expansion and upgrading from January 31 and February 14, said Gu Huinan, general manager of GAC Aion, a popular EV maker based in Guangzhou, Guangdong province. After that, the production efficiency of GAC Aion’s smart factory increased by 45 percent and customization capacity rose by 35 percent, which strongly promoted the rapid breakthrough of production and sales of the company in March, Gu said. China’s automobile production capacity layout is relatively balanced and the productions in East, Southwest, South, North and Northeast China accounted for 19, 17, 16, 14 and 12 percent, respectively, according to Cui. The relatively complete and controllable industrial chain of new energy vehicles also provides strong support for the growth of the industry, Cui said. The penetration rate of new energy vehicles in China rose from 6 percent in January 2021 to 22 percent by the end of last year, an average increase of 1.3 percentage points per month, said Wang Chuanfu, chairman of BYD. With excellent performance, competitive new electric vehicles and enhancing user-friendly environment, China’s EV industry has entered into a state mainly driven by the market, Wang said. Entering into new stage, breakthroughs are becoming more difficult and complex and new situation and problems need to be resolved, said Xin Guobin, vice-minister of industry and information technology. New energy vehicle industry’s supporting policy system should be improved, integrated innovation needs to be deepened, the supply of automobile chips needs to be continuously ensured, and oversight of security in function, data, cyber should be strengthened, Xin said. China’s new energy vehicle market enters a new stage of rapid growth from 2021 to 2030. The sale of new energy vehicles is expected to match fossil fuel vehicles by around 2030, said Ouyang Mingao, academician of the Chinese Academy of Sciences. +++
+++ GENERAL MOTORS and HONDA are planning to co-develop some affordable electric vehicles that will use next-generation Ultium battery technology. The vehicles, which will include a compact crossover, are expected to begin going on sale in North America in 2027. Doug Parks, GM executive vice president of global product development, purchasing and supply chain, said in a statement on Tuesday that the plan is to have an electric vehicle that is priced lower than the upcoming Chevrolet Equinox EV. GM and Honda have successfully partnered over the years. In 2013 the companies started working together on the co-development of a next-generation fuel cell system and hydrogen storage technologies. In 2018 Honda and GM announced that they’d team up to develop batteries for electric vehicles, mostly for the North American market. The 2 companies said at the time that they would collaborate based on GM’s next-generation battery system. Last year the companies announced that GM would build one Honda SUV and one Acura SUV using its Ultium-branded electric vehicle architecture and battery system. The companies said at the time that the Honda SUV would be named the Prologue, and that both SUVs would have bodies, interiors and driving characteristics designed by Honda. But Honda also said in June that it plans to make its own electric vehicles later this decade. +++
+++ The HYUNDAI MOTOR GROUP (Hyundai and its affiliate Kia) said their combined sales in the United States fell 3.7 percent in the first quarter compared with a year ago due to the prolonged pandemic and chip shortages. The corporate duo sold a total of 322.593 vehicles in the US in the first 3 months of this year, according to the companies’ sales data. In March alone, the 2 automakers sold a combined 123.507 units, a 14.8 percent decline from a year earlier. Hyundai’s US sales in the first quarter slipped 2.3 percent on-year to 171.399 units. In contrast to the sluggish overall performances, Genesis, Hyundai’s independent luxury division, saw its sales in the world’s most important auto market soar 42.6 percent to 11,723 units over the period. Hyundai’s sales of eco-friendly cars, including electric vehicles (EV), fuel cell electric vehicles and hybrid models, nearly doubled to 25.790 units in the first 3 months of the year. Its sister company Kia said it sold 151.194 units in the US in the first quarter, down 5.2 percent from a year earlier. The US sales of Kia’s eco-friendly models jumped 238.7 percent on-year to 18.549 units on the back of robust demand for its new EV models, it said. +++
+++ New car sales in JAPAN declined for the third straight year in fiscal 2021, down 9.5 % from a year earlier, as production slowed on shortages of semiconductors and other components amid the coronavirus pandemic, industry bodies said. A total of 4.215.826 cars were sold in the discal year that ended on Thursday March 31st, according to the Japan Automobile Dealers Association and the Japan Light Motor Vehicle and Motorcycle Association. Domestic auto sales excluding mini vehicles slumped 8.2% to 2.660.855 units, the second lowest since the survey began in fiscal 1968. Toyota sold 1.313.913 units, down 9.7%. The pandemic’s impact in Southeast Asia forced it to scramble for parts and temporarily reduce domestic production significantly. Honda and Nissan marked declines of 3.4% and 1.1%, respectively. Mazda reported a 15.4% fall, with Subaru losing 14.2%. Sales of minivehicles, which have an engine displacement of up to 660cc, tumbled 11.5% to 1.554.971 units, the lowest in 24 years. Daihatsu, Toyota’s minicar subsidiary, sold 506.436 cars, down 7.8%. Suzuki suffered a 12.8% fall to 470.498 units. +++
+++ Hyundai sold some 57.842 vehicles in Europe during the first 2 months of this year and about 20 percent of them, or some 11.532, were electric vehicles, meaning that 1 in 5 of its sales were EVs. EVs accounted for a mere 1 percent of the carmaker’s total sales in Europe in 2018, but the figure surged to 14 percent last year and now stands at over 20 percent for the first time. Its new all-electric Ioniq 5 led the growth with some 5.170 units sold just in 2 months since its release late last year. Affiliate Kia is also steadily increasing EV sales there, with its market share jumping from 13 percent to 17 percent on-year. According to EU-EVs, which tracks EV sales in Europe, the two KOREAN AUTOMAKERS ‘ combined market share stood at 14.6 percent to rank second in terms of EV sales there so far this year, up three notches from fifth place last year, when its share was 10.6 percent. German carmaker Volkswagen took the top spot with 19.4 percent and American electric giant Tesla came a close third with 14.2 percent. +++
+++ Leading Chinese electric vehicle startups have seen strong car deliveries in March despite challenges such as the Covid-19 pandemic, showcasing the consumption momentum in NEW ENERGY VEHICLES (NEVs, including EVs) and local consumers’ enthusiasm for environmentally friendly vehicles. The rising car deliveries came as the Ministry of Industry and Information Technology, China’s top industry regulator, said recently that more efforts will be made to encourage the use of NEVs and the nation will accelerate the development of domestic resources to cope with price increases in raw materials for batteries. Electric vehicle pioneer Li Auto said it delivered 11.034 of its Li One SUVs in March, up 125.2 percent year-on-year. For the first quarter, Li Auto said it had delivered 31.716 vehicles, an increase of 152.1 percent year-on-year. Li Auto is scheduled to release its next model, the L9 SUV, on April 16, as it aims to further stand out amid intensified competition in China’s EV market. Another EV startup Xpeng said it delivered 15.414 vehicles in March, up 148 percent from February. For the first quarter, Xpeng delivered 34.561 cars, an increase of 159 percent year-on-year. Xpeng’s P7 flagship sedan also exceeded 9.000 deliveries, a monthly record, the company said. Industry peer Nio delivered 9.985 vehicles in March, up 62.8 percent from February. The company delivered 25.768 vehicles in the first quarter, an increase of 28.5 percent year-on-year. Experts said the data showed relatively strong consumption momentum in NEVs, but they also warned that rising local cases of COVID-19 may affect factory production of NEVs to some extent. Price hikes in raw materials for batteries will also pose some challenges, said Jia Xinguang, an independent auto analyst. Xin Guobin, vice-minister of industry and information technology, said at a forum in late March that the ministry will make more efforts to cope with costlier raw materials. Xin said the ministry will accelerate the development of domestic resources, crackdown on unfair competition activities (such as hoarding and speculation) and guide upstream and downstream enterprises in the industrial chain to strengthen cooperation and help ease prices of key raw materials. More measures will also be taken to improve the supply capacity of key raw materials and parts, and guarantee the capacity of vehicle-charging services, Xin added. Despite short-term challenges, experts have been cautiously optimistic about this year’s NEV sales performance. Fu Bingfeng, executive vice-president of the China Association of Automobile Manufacturers, said earlier that production and sales of NEVs are expected to maintain growth this year. China’s low-carbon strategy, advancements in intelligent connectivity technologies and innovation in business models will help further popularize NEVs, Fu said. +++
+++ Kanglim, a Kosdaq-listed company that makes fire and tanker trucks, is bidding for SSANGYONG after the wheels came off an acquisition by Edison Motors. “We are actively looking into the acquisition and expressed our intent to the deal’s lead manager, EY Hanyoung, recently”, said a spokeswoman for Ssangbangwool, an underwear maker controlled by Kanglim, on Friday. “We are planning on forming a consortium led by our affiliate Kanglim. We are going to submit a letter of intent some time next week”. Kanglim is the largest shareholder of Ssangbangwool, with a 12.4 percent stake. The Kosdaq-listed Kanglim was founded in 1979 and acquired its stake in Ssangbangwool in 2014. Ssangbangwool said it expects synergies between Kanglim and SsangYong in electric vehicles if the acquisition goes through. “Kanglim is co-developing electric powertrains for vehicles in partnership with U.S. startup Ridecell and we believe such a business will create synergies with SsangYong”. Edison Motors, the preferred bidder for the debt-laden automaker, was bailed out of its acquisition of SsangYong on March 28 by failing to pay 300 billion won ($247 million). A rehabilitation plan based on the idea that Edison Motors, an electric bus manufacturer, would take over was nullified by the Seoul Bankruptcy Court on March 30. SsangYong said it was looking for a new buyer. How Kanglim and Ssangbangwool will finance an acquisition is not known. In 2021, a consortium lead by Ssangbangwool and Kanglim participated in a tender to acquire budget airline Easter. It reportedly bid 100 billion won, but lost to real estate developer Sung Jung. “How we will come up with the financing, such as how seven of our affiliates will contribute to the acquisition price will be detailed in a letter of intent next week”, the spokeswoman said. +++
+++ TOYOTA reaffirmed its commitment to the United Kingdom. after a newspaper reported it may halt making cars in the country because of government plans to shift more rapidly to fully electric vehicles. The Japanese automaker said it’s ready to sell only zero-emission cars and reiterated its view that hybrids have a role to play in the transition by 2035 as the U.K. prepares to set new targets for the auto industry. Toyota is focused on achieving a long-term and sustainable future in Europe, including for its British plants, the carmaker said in an emailed statement. The company was responding to a report that said it had warned Transport Secretary Grant Shapps it may cease manufacturing in Britain. Toyota said it shares the U.K.’s ambition to head toward zero emissions, though declined to comment on the government’s mandates because it hasn’t seen a draft of the rules being prepared by the Department for Transport. “We continue to see a role for many different technologies in the transition to zero emission based on the principle of mobility for all, including the current hybrid vehicles built in the U.K.”, Toyota said in the statement. The government will require that zero-emission vehicles will make up a rising proportion of new car and van sales each year starting in 2024, the London-based Times reported. Manufacturers that don’t hit targets will have to pay penalties or buy credits from competitors who surpass the thresholds. Details of the mandate are still being developed. Toyota vowed in December to be ready to sell only zero-emission cars in Europe by 2035 and set an intermediate goal for them to make up at least half of its sales by the end of the decade. The company announced a more than £240 million ($315 million) investment in its plant in Burnaston, central England, in 2017 to support production of the Corolla. It also has an engine plant in Deeside, north Wales. The U.K. plans to ban sales of new cars that run entirely on gasoline and diesel after 2030 and is permitting hybrid sales until 2035. +++
+++ BMW has halted production at 2 German factories. Mercedes is slowing work at its assembly plants. Volkswagen, warning of production stoppages, is looking for alternative sources for parts. For more than a year, the global auto industry has struggled with a disastrous shortage of computer chips and other vital parts that has shrunk production, slowed deliveries and sent prices for new and used cars soaring beyond reach for millions of consumers. Now, a new factor, Russia’s war against UKRAINE , has thrown up yet another obstacle. Critically important electrical wiring, made in Ukraine, is suddenly out of reach. With buyer demand high, materials scarce and the war causing new disruptions, vehicle prices are expected to head even higher well into next year. The war’s damage to the auto industry has emerged first in Europe. But U.S. production will likely suffer eventually, too, if Russian exports of metals (from palladium for catalytic converters to nickel for electric vehicle batteries) are cut off. “You only need to miss one part not to be able to make a car”, said Mark Wakefield, co-leader of consulting firm Alix Partners’ global automotive unit. “Any bump in the road becomes either a disruption of production or a vastly unplanned-for cost increase”. Supply problems have bedeviled automakers since the pandemic erupted 2 years ago, at times shuttering factories and causing vehicle shortages. The robust recovery that followed the recession caused demand for autos to vastly outstrip supply; a mismatch that sent prices for new and used vehicles skyrocketing well beyond overall high inflation. In the United States, the average price of a new vehicle is up 13% in the past year, to $45.596. Average used prices have surged far more: They’re up 29% to $29.646 as of February. Before the war, S&P Global had predicted that global automakers would build 84 million vehicles this year and 91 million next year. (By comparison, they built 94 million in 2018). Now it’s forecasting fewer than 82 million in 2022 and 88 million next year. Mark Fulthorpe, an executive director for S&P, is among analysts who think the availability of new vehicles in North America and Europe will remain severely tight (and prices high) well into 2023. Compounding the problem, buyers who are priced out of the new-vehicle market will intensify demand for used autos and keep those prices elevated, too; prohibitively so for many households. Eventually, high inflation across the economy (for food, gasoline, rent and other necessities) will likely leave a vast number of ordinary buyers unable to afford a new or used vehicle. Demand would then wane. And so, eventually, would prices. “Until inflationary pressures start to really erode consumer and business capabilities”, Fulthorpe said, “it’s probably going to mean that those who have the inclination to buy a new vehicle, they’ll be prepared to pay top dollar”. One factor behind the dimming outlook for production is the shuttering of auto plants in Russia. Last week, French automaker Renault, one of the last automakers that have continued to build in Russia, said it would suspend production in Moscow. The transformation of Ukraine into an embattled war zone has hurt, too. Wells Fargo estimates that 10% to 15% of crucial wiring harnesses that supply vehicle production in the vast European Union were made in Ukraine. In the past decade, automakers and parts companies invested in Ukrainian factories to limit costs and gain proximity to European plants. The wiring shortage has slowed factories in Germany, Poland, the Czech Republic and elsewhere, leading S&P to slash its forecast for worldwide auto production by 2.6 million vehicles for both this year and next. The shortages could reduce exports of German vehicles to the United States and elsewhere. Wiring harnesses are bundles of wires and connectors that are unique to each model; they can’t be easily re-sourced to another parts maker. Despite the war, harness makers like Aptiv and Leoni have managed to reopen factories sporadically in Western Ukraine. Still Joseph Massaro, Aptiv’s chief financial officer, acknowledged that Ukraine “is not open for any type of normal commercial activity”. Aptiv, based in Dublin, is trying to shift production to Poland, Romania, Serbia and possibly Morocco. But the process will take up to six weeks, leaving some automakers short of parts during that time. “Long term”, Massaro told analysts, “we’ll have to assess if and when it makes sense to go back to Ukraine”. BMW is trying to coordinate with its Ukrainian suppliers and is casting a wider net for parts. So are Mercedes and Volkswagen. Yet finding alternative supplies may be next to impossible. Most parts plants are operating close to capacity, so new work space would have to be built. Companies would need months to hire more people and add work shifts. “The training process to bring up to speed a new workforce; it’s not an overnight thing”, Fulthorpe said. Fulthorpe said he foresees a further tightening supply of materials from both Ukraine and Russia. Ukraine is the world’s largest exporter of neon, a gas used in lasers that etch circuits onto computer chips. Most chip makers have a six-month supply; late in the year, they could run short. That would worsen the chip shortage, which before the war had been delaying production even more than automakers expected. Likewise, Russia is a key supplier of such raw materials as platinum and palladium, used in pollution-reducing catalytic converters. Russia also produces 10% of the world’s nickel, an essential ingredient in EV batteries. Mineral supplies from Russia haven’t been shut off yet. Recycling might help ease the shortage. Other countries may increase production. And some manufacturers have stockpiled the metals. But Russia also is a big aluminum producer, and a source of pig iron, used to make steel. Nearly 70% of U.S. pig iron imports come from Russia and Ukraine, Alix Partners says, so steelmakers will need to switch to production from Brazil or use alternative materials. In the meantime, steel prices have rocketed up from $900 a ton a few weeks ago to $1,500 now. So far, negotiations toward a cease-fire in Ukraine have gone nowhere, and the fighting has raged on. A new virus surge in China could cut into parts supplies, too. Industry analysts say they have no clear idea when parts, raw materials and auto production will flow normally. Even if a deal is negotiated to suspend fighting, sanctions against Russian exports would remain intact until after a final agreement had been reached. Even then, supplies wouldn’t start flowing normally. Fulthorpe said there would be “further hangovers because of disruption that will take place in the widespread supply chains”. Wakefield noted, too, that because of intense pent-up demand for vehicles across the world, even if automakers restore full production, the process of building enough vehicles will be a protracted one. When might the world produce an ample enough supply of cars and trucks to meet demand and keep prices down? Wakefield doesn’t profess to know. “We’re in a raising-price environment and a production-constrained environment”, he said. “That’s a weird thing for the auto industry”. +++
+++ When Ian Campbell’s wife got rear-ended in her Honda HR-V last month, the Atlanta couple were thrust back into the new-car market , just as gasoline prices surged to more than $4 a gallon. After being quoted $6.000 above the manufacturer’s suggested retail price on a 2023 Kia Sportage and passing on an optioned-out Hyundai Tucson for $45.000, Campbell and his wife settled on a $36.000 Toyota RAV4 hybrid, sight unseen. He expects to drive it off the lot by Saturday. “It’s coming by the end of this week and time is a factor, because she’s driving a rental but insurance isn’t going to pay that forever”, Campbell said by phone. “The mileage with the current gas price was a factor” as well. At a time of barren dealer lots, soaring gas prices and stingy car discounts, Toyota will likely be king of UNITED STATES new car sales for a second consecutive quarter, according to researcher Cox Automotive. The full-line maker of budget compact sedans, midmarket crossovers and luxury SUVs currently offers 18 hybrid and fuel cell models. Its brands represent more than half of total hybrid vehicle sales in the U.S. Toyota has also more deftly navigated a chip crunch crimping vehicle output than some of its peers, which helped it oust General Motors as the No. 1 automaker in the U.S. for the last 3 months of 2021. Whether that held into the beginning of 2022 will become clearer Friday, as most automakers are set to report first-quarter totals. New car sales likely dropped 16% to 3.3 million in the first 3 months of 2022, which would be the second-worst quarter in a decade, according to Cox. The seasonally adjusted annual rate likely slipped to about 13.2 million new vehicles in March, down from 17.8 million a year earlier, according to the average forecast of eight market researchers. Toyota has outperformed during the chip crisis because it’s used to operating with lean inventory and has streamlined trim options, said Brian Finkelmeyer, who focuses on inventory management technology at Cox Automotive. “They’re constantly saying, ‘We’re just going to build the core specs we know consumers are buying’ ”, Finkelmeyer said. “They make it very difficult for the dealer to order something that’s not a fast mover”. The semiconductor shortage that’s been choking off vehicle production for more than a year will linger for the rest of 2022, executives and analysts say, while the war in Ukraine has introduced new headaches for the global auto supply chain. Those wrinkles prompted Cox this week to cut its 2022 forecast for seasonally adjusted sales to 15.3 million from 16 million. Subdued sales outlook That compares with new light vehicle sales of 14.93 million last year, which was a 3.1% gain over 2020, according to the National Automobile Dealers Association. With inventories remaining tight and prices expected to stay elevated, Cox projects the pace of sales will likely remain subdued. That dynamic plays to Detroit automakers’ strategy of focusing on higher prices over volume: They killed off entry-level sedans in favor of more profitable trucks and SUVs with luxury price tags in recent years, while chip shortages have further drained inventory. As a result, Asian car brands have been gaining in mass-market sales. In 2021, Ford had the biggest market share for vehicles priced above $50.000, ahead of Mercedes-Benz, according to Cox. Toyota was the market leader for vehicles under $50.000. Toyota’s sales last year were buoyed by cars such as the compact Corolla and large Camry sedans. The RAV4 was the automaker’s top seller despite a sales decline. While Toyota may have the biggest slice of sales in 2022’s first quarter at 15.6%, Tesla will post the biggest gain, according to Cox. The maker of electric vehicles likely expanded its market share 2.2 percentage points over the first quarter of 2021 to 4%. +++
+++ Toyota customers soon won’t be able to get UNITED STATES FEDERAL TAX CREDITS for buying electric or hybrid vehicles. The automaker expects that sometime before the end of June it will reach a 200.000-vehicle cap on the credits, Bob Carter, Toyota’s head of North American sales, said. After that, the credits will be phased out over the next year, reaching zero, as Tesla and General Motors already have. The lack of credits is problematic for automakers shifting from petroleum-powered vehicles to batteries in the effort to reduce emissions, meet government fuel-economy standards and fight climate change. Nissan is about 30.000 vehicles away from reaching the cap, and others will follow as more EVs are introduced. Tesla, the top seller of electric vehicles in the world, and General Motors already are at a price disadvantage to other automakers without the credits, and Toyota soon will be. Additional EV tax credits are in the Build Back Better spending bill backed by President Joe Biden, which is stalled in Congress. Toyota reached the cap largely by selling plug-in gas-electric hybrid vehicles. The company’s plug-in RAV4 Plug-in with 67 km of electric range earns the buyer a $7.500 credit, the largest available. The Prius Plug-in, with 40 km of electric range, gets $4,500. Toyota previously had offered a fully electric RAV4, but it didn’t sell well and was canceled. It’s rolling out a fully electric model called the BZ4X with 400 km per charge, this summer. The Build Back Better bill would give EV buyers a $7.500 tax credit through 2026 to charge up sales. But the following year, only electric vehicles made in the U.S. would qualify for the credit. And the base credit rises by $4.500 if the vehicle is made at a U.S. plant that runs under a union-negotiated collective bargaining agreement. Only GM, Ford and Stellantis vehicles would qualify. Carter, on a conference call with reporters, said Toyota lobbied against the additional credit only for union plants, calling it unfair to nonunion workers. “It just needs to be a level playing field”, Carter said. “We are not anti-EV credits”. Democrats backing the credits for EVs made by the United Auto Workers say supporting union jobs is good for the economy and communities because unions helped to build the middle class. General Motors CEO Mary Barra has said automakers that offered electric vehicles early should not be placed at a disadvantage. Restoring the credits is “a question that congress really needs to resolve”, Carter said. Toyota plans to offer 30 fully electric vehicles from its Lexus and Toyota brands by 2030. +++
