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The European Union launched an investigation over Chinese EV subsidies as the global markets are “now flooded with cheaper electric cars.” European Commission President Ursula von der Leyen revealed the probe Wednesday, claiming Chinese EV makers benefit from state subsidies.

The EU probe could lead to potential tariffs, which would likely have significant impacts on the market and Chinese EV makers.

“Global markets are now flooded with cheaper electric cars.” the EU Commission chief said in her annual speech to the European Parliament. “And their price is kept artificially low by huge state subsidies.”

The move comes as electric vehicle imports from China continue gaining momentum in the region.

China’s largest EV makers, like BYD, NIO, and XPeng, are launching models designed for the European market. And so far, it’s working.

New Energy Vehicle (NEV) exports from China rose 63.6% through the first seven months of the year, according to data from the China Association of Automobile Manufacturers (CAAM).

The European expansion was evident at the IAA Mobility show in Munich, with Chinese EV makers doubling their presence compared to 2021. EV leaders, including BYD and SAIC’s MG, unveiled impressive all-electric models aimed at the EU market.

Michael Shu, Managing Director of BYD Europe, speaks at the IAA (Source: BYD)

BYD showcased six EVs, including the SEAL electric sedan and SEAL U, designed for European customers. The BYD Seal starts at 45,000 euros (about $48,000) with up to 570 km (354 mi) range.

NIO also launched its ET5 Touring this summer, its first electric station wagon, designed to rival German automakers including Porsche and BMW.

NIO ET5 Touring designed for Europe (Source: NIO)

EU probes Chinese EVs over state subsidies

With new models like the SEAL and ET5 Touring rolling out with competitive pricing and often better technology, mass-market automakers like Volkswagen and Stellantis are feeling the pressure.

According to Jato Dynamics (via Reuters), the average retail price of Chinese EVs in Germany was 29% lower than non-Chinese models, excluding incentives and discounts.

BYD Yuan Plus EV (Source: BYD)

The EU is already moving toward a clear future. As part of its Green Deal, the EU approved a law banning the sale of new ICE passenger cars from 2035. The move has accelerated EV sales in the region, but there are concerns over China’s economic practices.

The probe comes as the EU looks to avoid repeating what happened with the solar industry when cheaper Chinese imports squeezed many manufacturers out of the market.

If the EU decides to slap tariffs on Chinese EVs, it would have broader impacts, including brands that build cars in China, such as Tesla, Volvo, Polestar, Renault, and BMW.

Volkswagen ID.7 (Source: VW)

The Commission will have up to 13 months to decide to implement tariffs above the 10% standard rate.

Shares of Chinese EV makers, including NIO, Xpeng, and BYD, were down in Wednesday’s trading session following the news.

Electrek’s Take

Although the EU is looking to protect its auto industry from being overtaken by cheaper Chinese EVs, a tariff may have significant impacts on the market.

For one, automakers in Germany rely heavily on China to drive sales revenue. Volkswagen has generated nearly half of its revenue from China, but the automaker is losing out to domestic EV makers as the EV transition heats up.

BYD surpassed VW as China’s top-selling car brand for the first time earlier this year. Meanwhile, Volkswagen has already slashed prices in the region in a bid to even the playing field, but how long can this go on?

Europe’s largest automaker also recently made several partnerships in the region to advance its position, including a $700 million investment into XPeng.

The biggest issue facing the EU is that many of these Chinese EVs are built better with superior technology and designs. While many European automakers delayed the transition to electric, EV makers like BYD and NIO took advantage of it, accelerating development and production.

NIO’s CEO William Li warned about the possibility of “protectionist policies” in April due to their cost advantages.

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Volkswagen cites slow demand amid EV production cuts at German plants




Volkswagen cites slow demand amid EV production cuts at German plants

Amid several reports that Volkswagen is cutting EV production at two German plants, the automaker revealed the reason – slowing demand.

Volkswagen suspends EV production in Germany

Last week, a report from the German newspaper Automobilwoche claimed Volkswagen was pausing EV production at its Dresden facility in Germany.

Volkswagen’s Dresden facility has built over 150,000 VW Phaeton, e-Golf, ID.3, and Bentley Flying Spur models since beginning production in 2002. Last year, 6,500 ID.3 EVs were built at the location.

The automaker will temporarily suspend ID.3 production at the plant for two weeks during the Saxon autumn holidays, as first reported by Germany’s DPA news. Starting October 16, the electric car will be built again in regular single-shift operation.

Dresden’s roughly 300 employees will be reassigned to other areas, including “innovative manufacturing and testing.”

Meanwhile, at Volkswagen’s main BEV plant in Zwichau, one of the two production lines will shut down during the holidays, according to a spokesperson (via Automobilwoche).

The news comes after VW announced at a staff meeting earlier this month it would be cutting 269 temporary jobs at the site.

Although Volkswagen’s ID.3 and Cupra Born will be impacted by the halt, ID.4, ID.5, Audi Q4 e-tron, and Audi Q4 sportback e-tron models will continue regular production in three shifts.

Volkswagen ID.3 production at Dresden (Source: Volkswagen)

Volkswagen is discussing with local labor reps how to proceed with EV production at the Zwickau plant.

The company did not specify how many units or employees would be affected by the changes.

ID.4 (left) quality control at Zwickau plant (Source: VW)

Volkswagen is struggling to attract new EV orders amid higher inflation and weaning subsidies in Europe. Europe’s largest automaker also faces a growing threat from more advanced EV competitors like Tesla and BYD.

Electrek’s Take

The core Volkswagen brand faces pressure as cheaper, more advanced EVs are taking market share at home and abroad.

In Volkswagen’s largest market by revenue (China), the automaker was surpassed by BYD as the best-selling car brand earlier this year.

In the wake of slowing demand, VW slashed ID.3 and ID.4 prices in the region. But how long can VW keep this up?

Volkswagen Group CEO Oliver Blume aims to boost VW brand returns to 6.5% over the next three years. Currently, it’s around 3.6%.

With EV makers like Tesla, BYD, and several other Chinese start-ups expanding rapidly, Volkswagen will need to act urgently to risk falling further behind.

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Honda’s new electric sports car will debut next month, hinting at an NSX successor EV




Honda's new electric sports car will debut next month, hinting at an NSX successor EV

At the Japan Mobility Show next month, Honda will showcase several new products and tech, including a new electric sports car that will headline the booth.

The new electric sports car will “enable the driver to experience the pure joy of driving,” according to Honda.

Although the automaker was light on the details behind the project, it claims the concept will represent “Honda’s continuous pursuit of the joy of driving” while embodying Honda’s universal sports mindset and distinctive characteristics.

Also ready to make an appearance at the booth is Honda’s SUSTAINA-C Concept and Pocket Concept, designed to use limited resources.

Both models are made of recycled and reused acrylic resin with the idea of “resource circulation” for environmental sustainability and future mobility freedom.

Other EV products set to make their world debut include the Honda CI-MEV. The two-seat, four-wheel mini EV uses Honda’s cooperative intelligence (CI) and automated driving for last-mile deliveries and areas with limited mobility options.

A prototype of Honda’s new commercial-use mini EV with a portable external power output device, Power Exporter e: 6000, will also be displayed.

Honda CI-MEV (Source: Honda)

Honda to unveil new electric sports car

Honda revealed plans to launch 30 new EV models globally by the end of the decade, including at least two electric sports cars.

One will be a specialty model, while the other will be a flagship. Speculation suggests one of the models will be an NSX, a two-seater sports coupe (An Acura model in North America), with the other being a GT.

Honda electric sports car concepts (Source: Honda)

Honda teased the upcoming electric sports cars under wraps, showing a low-profile vehicle with a similar body design to the NSX.

According to the British automotive magazine Car, Honda’s EV performance car will ride on the automaker e:n platform, featured in its e:Ny1 electric SUV.

Honda e:Ny1 (Source: Honda)

The EV could also wear the Type R badge, as Honda’s technical consultant, Kotaro Yamamoto, said, “Type R stands for racing. It’s a pleasure transported. An electric car can deliver this, and a Type R is not obliged to use a combustion engine. Even in a fully electric society, there will still be Type Rs delivering ultimate driving pleasure.”

Other than that, Honda is keeping the details under wraps. We’ll learn more about the electric performance car next month.

The electric sports car will make its world debut at the Japan Mobility Show, running from October 28 to November 5, 2023. Media days will be October 25-26.

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Is this the production Tesla Cybertruck?




Is this the production Tesla Cybertruck?

New Tesla Cybertrucks, rumored to be “Master Candidates,” the final step before production, have been spotted coming out of Gigafactory Texas.

For the past month, Tesla has had full and at times, partial shutdowns, of production at Gigafactory Texas as it conducted factory upgrades.

Yesterday, a drone video shot by Joe Tegtmeyer confirmed that workers are now coming back to the factory.

The video showed new Model Y bodies coming out of the factory and new Cybertrucks.

There have been rumors that the shutdown at Gigafactory Texas might have been linked to the start of Cybertruck production.

Tegtmeyer, who often gets to talk to Giga Texas employees as he flyes drones there almost daily, claims that the new Cybertrucks spotted coming out of the factory are “Master Candidates,” the last step before production.

While it can’t be confirmed if they are master candidates or production versions, the two Cybertrucks spotted at the factory did look a lot more refined than the previously spotted prototypes:

The trims and fittings seem to blend better with the stainless steel body of the electric pickup truck.

While we can’t judge the vehicle’s fit and finish too closely because the footage is taken from a distance with a drone, the looks of those two Cybertrucks are encouraging.

Tesla is expected to officially start Cybertruck production any day now with deliveries to start at an event likely within the next month.

More Cybertrucks have been spotted parked at the homes of Tesla employees, which is a good sign that internal testing has expanded.

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