Automotive State of The Union

The proposed bill would ban Chinese-made vehicles, parts, and software from entering the U.S. market.

Moreno and Slotkin want to expand existing rules and “seal” the entire automotive supply chain from foreign adversaries.

The effort comes ahead of a planned Trump-Xi meeting and growing political pressure to act.

Support from UAW and GM highlights industry concern over competition and data security risks.

“People are really, really pressed right now… people are looking for cheaper cars… but as leaders, we have a responsibility to say, ‘Look, this is a driving surveillance package, it’s like TikTok on wheels,”” Slotkin said.

Rivian cut planned capacity from 400,000 to 300,000 vehicles annually as its federal loan shrinks to $4.5B.

The upside: funds will be available sooner, allowing a single-phase build instead of two stages.

The plant, opening in 2028, will produce the R2 and future models aimed at broader affordability.

Rivian’s Q1 showed progress with losses narrowing 23% and deliveries up 20% year-over-year.

“R2 provides the opportunity to expand the Rivian brand to millions of drivers,” said CEO RJ Scaringe.

Law enforcement can now issue “notices of AV noncompliance” for violations like running red lights or ignoring school buses.

The move follows years of viral mishaps and ongoing investigations into systems like Tesla’s Full Self-Driving.

AV companies must respond to first responders within 30 seconds and comply with emergency geofencing to avoid active scenes.

New rules also open the door for testing heavy-duty autonomous trucks and set training requirements for remote operators.

Carvana sold 187,393 vehicles in Q1 2026, up 40% year-over-year and marking its sixth straight quarter of 40%+ growth.

Revenue jumped to $6.43B with net income hitting $405M, beating analyst expectations across the board.

The company is expanding capacity, integrating ADESA sites, and building toward 1.5M annual unit capability—with room to reach 3M.

Carvana expects continued growth in Q2, assuming stable market conditions and momentum holds.

“We are continuing to hit records… and scale a business of Carvana’s complexity at high speed,” said CEO Ernie Garcia.

Ford, GM, Mercedes, and Stellantis booked roughly $2.3B in expected tariff refunds, boosting Q1 profits on paper.

Ford alone expects $1.3B back, GM about $500M, tied to overturned tariffs under IEEPA.

Automakers stress the cash hasn’t arrived yet—so it’s not counted as free cash flow.

The refund process could take months, adding uncertainty to already complex financial planning.

The overturned IEEPA tariffs are just one piece—automakers still face ongoing import taxes on steel, aluminum, and vehicles and parts from Mexico, Canada, and beyond.

Cloudflare warns most websites are built for humans—not AI agents that search, decide, and transact automatically.

“Agent readiness” means structuring sites so AI can easily access, interpret, and act on information.

This includes better APIs, structured data, and permissions for what agents can or can’t do.

Businesses may need to rethink UX entirely—designing for machines as much as for people.

“The web is being rebuilt for agents,” Cloudflare suggests, signaling a major shift in how digital commerce will operate.

More than 70 House Democrats are pushing to maintain a full ban on Chinese vehicles entering the U.S. market.

The current restrictions stem from 2025 rules citing national security concerns, especially around data collection from connected vehicles.

Despite high tariffs and bans, consumer curiosity about Chinese EVs is increasing, especially with the Beijing Auto Show currently happening

The debate gets complicated as Trump made comments in January welcoming Chinese automakers building plants and jobs on U.S. soil.

“We must not cede the American auto industry to a strategic competitor intent on global dominance,” lawmakers said.

Chinese brands like BYD, Geely, and Great Wall are thriving in Mexico with EVs, hybrids, and gas vehicles priced well below U.S. offerings.

Dealerships near El Paso are attracting attention from American shoppers, with some buyers and drivers already bringing vehicles into the U.S. under legal exceptions.

One driver regularly commutes into Texas in a Chinese plug-in hybrid.

Executives warn the pricing pressure is real, with some saying competing at Chinese price points would mean losing money.

“If they were allowed to be sold in the United States…they would destroy the American car market,” said a Geely salesman,

Newsweek’s 2026 list ranks retailers like Chewy, Costco, Amazon, and Home Depot among the most trusted companies in the U.S.

The rankings are based on consumer perceptions of trust across industries, with retail heavily represented at the top.

The report emphasizes that trust is increasingly tied to transparency, reliability, and handling of customer data.

Some critics argue the list favors large corporations and question whether trust can truly be measured through surveys.

Farley calls today a “fitness test” as EVs, software-defined vehicles, and emissions targets collide all at once.

Chinese automakers have leapfrogged legacy OEMs in EV tech, speed to market, and cost—sometimes building cars twice as fast.

Ford admits early EV efforts missed the mark on cost and design, losing money despite strong consumer interest.

Dealers remain a strategic advantage as global competitors lack distribution networks built over decades.

“If we don’t put our chips on the right number… Ford could maybe not exist.” — Jim Farley

The average new car in the U.S. tops $51K, while China offers 200+ EVs under $25K—and some under $12K.

Models like the Wuling MiniEV start around $6,500, prioritizing affordability over size and speed.

BYD is dominating the segment, selling hundreds of thousands of sub-$12K EVs with surprising tech and range.

Even entry-level Chinese EVs now include features like lidar, fast charging, and 300+ mile range (China standard).

“When you get in [these vehicles], you don't feel like you are in a small car.” — Analyst Felipe Muñoz

The study analyzes credit and debit transactions across all service channels including dealerships, independents, quick lubes, and tire chains.

Overall service transaction dollars fell 8.3 percent, but dealers declined faster at 11 percent.

Dealership service transactions dropped 13 percent year over year, the steepest decline among all segments tracked.

Quick lube shops gained market share while raising prices more slowly than dealerships, attracting cost-conscious customers.

Even with free OEM-paid maintenance, dealers are struggling to retain customers in the critical first two years of ownership.

“The quick lubes are what everybody should be worried about,” said Ducker Carlisle’s Nate Chenenko.

Recurrent data shows EVs retain about 97% of range after three years and 95% after five years of ownership.

The study is based on real-world driving data, factoring in climate, usage, and battery age, not just EPA estimates.

About 68% of 2023 model-year EVs are still exceeding their original EPA range today.

Automakers are offsetting degradation with OTA updates and built-in battery buffers that unlock over time.

Robertson led international visitors through the Beijing Auto Show, showcasing China’s latest EVs and tech-forward designs.

Perception has shifted dramatically, with Chinese brands now recognized for advances in batteries, software, and charging.

Attendees highlighted futuristic interiors and features, calling the vehicles a “new generation” of driving experience.

Competitive pricing remains a major disruptor, with fully loaded EVs around $30,000 undercutting U.S. options.

“Our comment section is full of people saying, ‘I can’t believe the government won’t allow them to sell this car in my country,’” said Robertson.

Fullpath specializes in stitching together years of CRM and DMS data into a single customer profile.

The platform enables always-on, AI-driven campaigns with attribution from click to purchase.

Cox plans to integrate this with assets like Autotrader and Kelley Blue Book shopper data.

For dealers, this means less manual marketing and more automated, high-precision engagement.

“Fullpath gives dealers the AI and data infrastructure they need to compete.” – Steve Rowley, Cox Automotive

April new vehicle sales are projected at 1.36M units, down 7.3% year-over-year—but last year’s numbers were inflated by tariff-driven pull-ahead demand.

Average monthly payments hit a record $812, driven by declining trade-in equity and higher negative equity rates.

Incentives are climbing again, averaging $3,141 per vehicle, with EV incentives still topping $10K per unit.

Leasing is on the rise, now at 23.2%, as more customers return to the market after the pandemic gap.

“Affordability continues to constrain the vehicle sales pace…” – Thomas King, JD Power

Many engineers are spending 5–20+ hours per week learning AI tools, courses, and concepts to keep up.

AI is reshaping roles, with traditional engineering work shifting toward AI implementation and integration.

The pressure is clear: adapt quickly or risk falling behind in the job market.

Even tech leaders are dedicating significant time to experimenting with AI tools to stay ahead.

“In order to keep up with everything that's coming out right now, you have to have no job.” – Jason Grad, CEO, Massive

Hertz saw EV rental requests jump nearly 25% month-over-month, with strongest demand on the West Coast where gas prices hit hardest.

Turo reported an 11% booking increase in late March, with a 47% spike the day gas topped $4/gallon.

Fuel prices have surged over 30% since late February due to Strait of Hormuz disruptions impacting global oil flow.

While new EV sales are down 25% YoY, used EV prices and rental demand are climbing as consumers seek short-term savings.

John Coles of ACV Auctions said, “We have seen EVs get a second lease on life due to the sustained pressure at the pump.”

Nearly 31% of trade-ins in Q1 2026 carried negative equity, approaching record highs as used vehicle values normalize.

The average amount owed hit $7,183—up 42% from five years ago—showing how much debt is being carried forward.

Longer loan terms are a key driver, with over 90% of these deals stretching to at least 72 months.

More buyers are deeply underwater, with 26% rolling over $10K+ into their next loan, pushing monthly payments to record levels.

Edmunds said, “Many consumers who rolled debt into their last purchase are now finding there is no easy exit.”

The bank is pushing its 65,000 tech employees to show “meaningful improvement” in code output using AI tools.

Internal dashboards rank engineers by AI usage, with categories like “non,” “light,” and “heavy” users visible across teams.

Some employees worry they’ll be labeled underperformers if their AI usage doesn’t increase, despite unclear metrics.

The tracking reflects a broader trend as companies try to prove ROI on massive AI investments.

One developer said, “I thought this AI tool was supposed to make our lives easier, but it really seems to have stepped up how much we're expected to do.”

Carvana acquired Avon Lake CDJR near Cleveland, strengthening its hybrid model, pairing physical rooftops with its online sales and distribution network.

Stellantis recently limited buyers to one CDJR store per year, signaling a push to slow consolidation and maintain dealer network balance.

Analysts say these stores double as regional logistics hubs, keeping delivery distances within that 300–400 mile sweet spot.

“Nobody wants to sell a Lexus store…with Stellantis, there’s a ready supply.” said analyst Jeff Lick of Stephens Inc.

GM has indefinitely delayed its planned 2028 refresh of full-size EV trucks and SUVs, including Silverado EV and Escalade IQ.

The move follows $7.6B in EV-related charges and a sharp drop in sales after federal incentives disappeared.

Current EV truck volumes remain low, while GM is adding production capacity for gas-powered heavy-duty pickups.

Factory Zero, once the centerpiece of GM’s EV strategy, has seen layoffs, shutdowns, and reduced shifts amid weak demand.

“EVs remain the end game for GM,” the company said, despite the pause in next-generation planning.

Sony Honda Mobility is reducing operations after scrapping plans for its Afeela EV lineup.

Employees will be reassigned back to Sony and Honda as the JV winds down activity.

The companies cited challenges bringing products to market under the current structure.

Even as EV plans fade, the partners say they’ll continue focusing on software and user experience innovation.

“It would be difficult…to bring products and services aligned with the JV’s purpose to market,” the companies said.

The FTC is encouraging dealers to report competitors who violate ad rules, aiming to level the playing field.

Complaints can be submitted directly or through NADA, signaling a more collaborative enforcement approach.

Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection clarified that doc fees must be included in the advertised total price—not added later in the deal.

Total vehicle price must be displayed more prominently than MSRP in ads across all channels.

“[It’s important that] the consumer understands what it is that they’re going to be paying to get the car out the door,” said Christopher Mufarrige.

Unlike Ford and GM setups, Tesla uses an AC-based system—avoiding $6K–$10K DC charger installs.

Lower hardware complexity could remove a major barrier for homeowners to join grid programs.

Owners opt in to send energy back during peak demand—and get paid for it.

With 123 kWh onboard, each Cybertruck adds ~9x the storage of a typical home battery.

“Electric vehicles can do more than move people — they can help power homes,” said PG&E’s Jason Glickman.

John Ternus, Apple’s hardware engineering chief, will become CEO on September 1, 2026.

Cook will stay on as executive chairman, focusing in part on global policy and regulatory relationships.

The move caps a long-planned succession, not a sudden shakeup—Apple signaling stability.

Ternus brings a product-first background, having led hardware during Apple’s silicon and device expansion era.

“He is without question the right person to lead Apple into the future,” said Tim Cook.