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By Joseph White, Global Automotive Correspondent

Greetings from the Motor City!

It’s hard out there for a car company. General Motors raised its profit forecast for the year, announced a new U.S. battery plant and set out a timetable for converting a Michigan factory from building a money-losing EV to a higher-margin model….and its shares dropped 4% after executives warned that prices have likely peaked.

Tough crowd.

But optimism isn’t dead in the World of Cars, as we’ll see.

Today –

• • The IEA said one in five cars could be electric this year

  • Vinfast stays in the game with a fresh $2.5 billion

  • Battery maker LG Energy doubles profit

The electric road goes ever on.

Nearly one in five vehicles sold worldwide this year could be electric as more affordable EVs come on stream, the International Energy Agency said Wednesday. Global EV sales could jump 35% this year, the IEA forecast. (The full IEA outlook is here.)

Less than three years ago, EVs accounted for just 4% of the global market. Tesla CEO Elon Musk likes to use the word “exponential” to describe the growth curve for EVs (and Tesla.) The IEA forecast is more restrained, but it could give comfort to regulators looking to drive a rapid shift to zero-exhaust vehicles.

China is leading the way, the IEA said, with a 60% share of global EV sales.

One consequence of the EV Shift: World oil consumption could drop by 5 million barrels a day by 2030. (That’s about 5% of daily world oil consumption forecast by the U.S. Energy Department for this year.)

The EV Wave is hitting auto suppliers full force. Revenue from electric drivetrains and battery segments are expected to rise by 245% through 2027, while internal combustion component revenues will plunge by 44%, Deloitte concluded in a study this week. 

Another sign of the times: Mercedes-Benz on Tuesday launched what it said will be its last new combustion vehicles – petrol versions of the venerable E-class sedan.

Some auto industry executives still need convincing about the speed of EV adoption, especially in the United States. Asked Tuesday if she endorsed the Biden Administration’s proposals to use emissions rules to drive EVs to 67% of the U.S. market by 2032, GM CEO Mary Barra declined.

“We’ve got to dig into the details a little bit more,” she said. The concern, she added is that the goals are “able to be driven by customer demand, because anything else is not going to be productive.”

Allies in electrification.

South Korea’s President Yoon Suk Yeol arrived in Washington for a state visit with a big sack of new EV investments in his checked luggage.

Samsung SDI and General Motors said they will move ahead with a $3 billion battery factory, somewhere in the United States. The companies did not announce a location. Samsung and Stellantis are building a battery plant in Indiana.

Hyundai confirmed plans to invest $5 billion with South Korean battery maker SK On  to build a battery plant in Georgia.

Looming over these big dollar investments: Hyundai’s – and Yoon’s – unhappiness that South Korean-made vehicles no longer qualify for U.S. subsidies under the Inflation Reduction Act.

What people trade for a used EV. (Source: CarMax)

Toyotas are the number one vehicle brand traded in for a used electric vehicle at  CarMax stores, the U.S. used car retailer said this week.

Among shoppers who buy a used Tesla Model 3 from CarMax, a Honda Civic is the most common trade-in followed by the Toyota Tacoma.  

Bosch said it will acquire a semiconductor foundry and other assets from TSI Semiconductors and invest another $1.5 billion to expand production of silicon carbide chips. Those chips are increasingly in demand to enable longer range operation for electric vehicles.

Bosch, hit hard by the recent semiconductor supply chain snarls, is expanding in-house chip production in Germany and now the United States, where new federal and state subsidies could provide a brisk financial tailwind.  

South Korean EV battery maker LG Energy Solutions said Q1 profit doubled, powered by increasing U.S. battery sales and Inflation Reduction Act subsidies. LGES supplies batteries to General Motors, which reported a surge in sales for its Chevy Bolt EV during the quarter. LG and GM are accelerating production of batteries at a factory in Ohio.

About the Chevy Bolt: GM CEO Mary Barra disappointed the growing legion of fans of one of America’s most affordable EVs by announcing the Bolt will go out of production at the end of this year.

GM signaled the end for the Bolt months ago, when it outlined plans to spend $4 billion to convert the Orion assembly plant where the car is built into an electric pickup truck factory.

(GM is trying to allay critics of its focus on large electric trucks by pointing to future, more affordable models such as the $30,000 Chevy Equinox EV.)

Vietnamese EV startup Vinfast said its founder, Pham Nhat Vuong, has kicked in another $1 billion as part of $2.5 billion in new money raised to keep the company going.

Vinfast had hoped to use a U.S. IPO to finance its efforts to crack the U.S. market, but that plan has been sidelined as investor interest in high-risk EV startups has gone into deep freeze.

Honda CEO Toshihiro Mibe said his company will launch a new large to mid-size EV in the United States in 2025, using a new architecture. Honda also revealed a closer alliance with Taiwan’s chip powerhouse TSMC, aimed at preventing a repeat of the semiconductor supply shortages that hobbled Honda during the past two years.

Stellantis wants to cut 3,500 jobs from its U.S. hourly workforce through buyouts, according to a letter made public by a United Auto Workers local. The company did not confirm the plan, but it needs to find jobs for more than 1,300 United Auto Workers employees laid off at a Jeep factory in Belvidere, Ill. Those displaced workers could take jobs vacated by employees who opt for buyouts.

BYD cut the price for its Seagull electric car to 73,800 yuan, or $10,658. That’s 6.3% lower than the price BYD signaled when the car caused a sensation at the Shanghai Motor Show. BYD’s move promises to accelerate the downward spiral in EV prices in the Chinese market.

Traffic deaths fell slightly in the United States during 2022 from the previous year but remain at a level no one considers acceptable. The Transportation Department estimated 42,795 people died on U.S. highways. That translated to a death rate of 1.35 fatalities per 100 million vehicle miles traveled in 2022, down from 1.37 deaths per 100 million miles in 2021.

Fortum and Black Mass: Sounds like the afternoon lineup at a Finnish heavy metal festival. In fact, Fortum is a Finnish utility company that said this week it has launched Europe’s first facility to recover battery minerals from the “black mass” created by shredding EV batteries.

China’s Pony.AI can run driverless cars in Guangzhou, expanding on its earlier permit to launch driverless ride-hailing operations in Beijing. Pony.AI counts Toyota among its financial backers.

Renault has set course to match the software capabilities of Tesla vehicles by 2026, CEO Luca de Meo said. De Meo doubled down on his refusal to be drawn into a price war with Tesla. The new software architecture will be key to selling investors on a listing for Renault’s Ampere EV operation planned later this year.

The UAW and battery startup Sparkz have agreed to a partnership under which the company will remain neutral as the union tries to organize its operations. UAW President Shawn Fain has criticized Detroit automakers for setting up non-union joint venture plants with far larger battery-makers.

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