Auto File: In China, AI takes drivers’ jobs
By Victoria Walderse
Automotive Correspondent
Victoria.Waldersee@thomsonreuters.com
Greetings from Germany, where I woke up this morning wondering how much electric vehicles will have featured in Elon Musk's interview with Donald Trump on X last night and thrown off my plans for this newsletter. (I am filling in this week while Nick Carey enjoys a much-deserved break.)
It seems, however, that the two men - once they got past the technical glitches and started talking - didn't discuss cars much, other than a passing comment in which Trump told Musk he had an "incredible product" - but "that doesn't mean everyone needs an electric car".
Trump has railed against government funding to boost electrification, including the types of subsidies, loans and tax breaks which have been instrumental to Tesla's growth.
Even as Musk has embraced Republican Party rhetoric and said getting rid of subsidies would "only help Tesla", his company continues to lobby for U.S. and state benefits created and championed by the Democrats, from stricter vehicle emissions rules to banning the production of most new gasoline cars by 2035.
Days after Musk endorsed Trump in July, one user on X asked Musk if he would comment on Trump's views on EVs. "It will be fine," Musk responded.
Even if Musk thinks Tesla could do without government help, other EV makers are struggling to break ground in the United States, with new EVs and plug-in hybrids making up just 18% of new sales in the first quarter of this year - compared to 50% in China in July. We know Trump doesn't like losing to China... so will he just bow out of the EV race if he becomes president? Whatever he chooses, it sounds like Musk will have his back.
Onto today's Auto File...
China's drivers fret as robotaxis pick up pace, and passengers
Who's breaking WTO rules - China or EU?
Europe's EV leasing model at risk of breakdown
AI really is taking their jobs
Liu Yi, a 36-year-old ride hailing driver in Wuhan, China, is among the first workers globally to face the threat of job loss from artificial intelligence.
In his city of Wuhan, China, a firm called Apollo Go is one of a handful of firms to receive approval for testing robo-taxis without human-driver monitors and plans to deploy 1,000 vehicles by year end. "Everyone will go hungry," he told reporters Sarah Wu and Ethan Wang, who investigated the story for Reuters.
Apollo Go, owned by tech giant Baidu, says it will create jobs in monitoring, testing, and analyzing data from its trials. But Chinese social media shows scores of users worried that driving jobs - often a last resort for lower-class workers lacking qualifications - will disappear, with hashtags like "Are driverless cars stealing taxi drivers' livelihoods?" topping searches in July.
Europe stands firm on China EV probe
Things are hotting up between China and Europe as negotiations continue over the European Commission's proposed tariffs on EVs made in China.
The latest episode of the tit-for-tat happened last Friday, when China filed a dispute with the World Trade Organisation alleging that the EU's temporary measures violated its rules - an ironic accusation considering this all started because the EU said China was the one distorting competition with its subsidies.
The European Commission responded, saying it was studying the filing but was confident that its investigation was WTO-compatible and remained on track.
These kinds of disputes are supposed to be resolved through negotiation, but if that's not possible, members can request a panel to be formed to settle the matter. Still, those processes are complex, beset with hurdles and take a long time.
Symbolically, the exchange of the past week shows that tensions are running high. Xi Jinping’s economic model relies on exporting high-tech goods like electric cars, and with either U.S. presidential candidate unlikely to allow Chinese EVs (or many other high-tech Chinese products) in, Europe is China’s biggest hope for a profitable export market.
Leasing firms beg for mercy
Weak EV demand has been talk of the town for some time. What hasn’t been talked about enough is the role that leasing firms play in that story.
Europe’s auto market is driven by leasing firms. Around 60% of new cars of all fuel types are leased, rising to 80% of new EVs, according to data from market research firm Dataforce analyzed by environmental group Transport & Environment.
When leasing firms set their prices, they account for how much a vehicle will depreciate over the leasing period - typically three years - based on estimated resale prices, or 'residual values'.
If that resale price ends up being lower than anticipated, leasing firms lose money. Unfortunately, that’s what’s happening with EVs. Second-hand prices are falling because customers are worried about everything from charging infrastructure and battery life. Until those concerns are addressed, companies say any move by regulators to mandate electrifying more of their fleets would damage their business and push prices further up.
Essential Reading
The UAW endorsed Kamala Harris. Will it help her win?
Huawei readies new AI chip to challenge Nvidia in China
Fear fades in U.S. stocks, but return to calm unlikely (Breaking Views)
FAST LAPS
Indian automaker Mahindra & Mahindra (MAHM.NS) and China's Shaanxi Automobile Group have agreed to set up a $3 billion joint venture to build a car manufacturing plant in India and are awaiting New Delhi's approval, according to sources. Mahindra has sought a government nod for the Chinese investment, the sources said.
South Korea's land, industry and environment ministries will meet this week to discuss how to prevent fires involving electric vehicles, after a recent blaze caused by a Mercedes-Benz sedan with batteries by China's Farasis damaged over 140 cars and hospitalized 23 people. EV safety worries are just one of many factors slowing down sales.
General Motors is recalling 21,469 electric SUVs in the United States over concerns of an unexpected activation of the anti-lock brake system and will remedy the issue through an over-the-air update.
Think your friend or colleague should know about us? Forward this newsletter to them. They can also subscribe here.
Editing by Emelia Sithole-Matarise
Relaterade tillgångar
Senaste nytt
Ansvarsfriskrivning: XM Group-enheter tillhandahåller sin tjänst enbart för exekvering och tillgången till vår onlinehandelsplattform, som innebär att en person kan se och/eller använda tillgängligt innehåll på eller via webbplatsen, påverkar eller utökar inte detta, vilket inte heller varit avsikten. Denna tillgång och användning omfattas alltid av i) villkor, ii) riskvarningar och iii) fullständig ansvarsfriskrivning. Detta innehåll tillhandahålls därför uteslutande som allmän information. Var framför allt medveten om att innehållet på vår onlinehandelsplattform varken utgör en uppmaning eller ett erbjudande om att ingå några transaktioner på de finansiella marknaderna. Handel på alla finansiella marknader involverar en betydande risk för ditt kapital.
Allt material som publiceras på denna sida är enbart avsett för utbildnings- eller informationssyften och innehåller inte – och ska inte heller anses innehålla – rådgivning och rekommendationer om finansiella frågor, investeringsskatt eller handel, dokumentation av våra handelskurser eller ett erbjudande om, eller en uppmaning till, en transaktion i finansiella instrument eller oönskade finansiella erbjudanden som är riktade till dig.
Tredjepartsinnehåll, liksom innehåll framtaget av XM såsom synpunkter, nyheter, forskningsrön, analyser, kurser, andra uppgifter eller länkar till tredjepartssajter som återfinns på denna webbplats, tillhandahålls i befintligt skick, som allmän marknadskommentar, och utgör ingen investeringsrådgivning. I den mån som något innehåll tolkas som investeringsforskning måste det noteras och accepteras att innehållet varken har varit avsett som oberoende investeringsforskning eller har utarbetats i enlighet med de rättsliga kraven för att främja ett sådant syfte, och därför är att betrakta som marknadskommunikation enligt tillämpliga lagar och föreskrifter. Se till så att du har läst och förstått vårt meddelande om icke-oberoende investeringsforskning och riskvarning om ovannämnda information, som finns här.
