Kenya’s Uber drivers take the wheel

August is usually a quiet month for the car industry. When the dust has settled from half-year results conferences, carmakers wind down their plants, executives take their favourite new model out for a summer spin and workers take a well-earned break.

This year, though, it’s politicians and policymakers who are keeping autos in the headlines – from South Korean ministers grappling with how to tackle EV fires to European and Chinese policymakers debating how much you’re allowed to subsidise EV production before it counts as violating global trade rules.

Meanwhile, this morning at a campaign event in Pennsylvania, Donald Trump said if elected, he might end the $7,500 EV tax credit, impose new tariffs on cars from Mexico and rescind rules prodding carmakers to meet lower emissions standards with their vehicles.

More on the politics of cars in today’s Auto File…

As the well-documented price war in China’s EV market rages on, another price war of a different kind has been brewing in Kenya between ride-hailing companies and their drivers.

It’s a fascinating story by our colleague Edwin Okoth in Nairobi. Kenyans are struggling financially as tax hikes, soaring prices, and high interest rates place pressure on their incomes, leading to deadly protests in the country.

For cab drivers, the economic shocks mean that the prices generated by apps like Uber and Bolt are too low to survive on.

Despite protest from the companies, drivers are banding together to collectively agree on higher prices, printing their own fare guide to post up inside cars at around 1.5 times the price shown in the app.

Markets like Kenya, Tanzania, and Nigeria are among the most important for ride-hailing firms like Uber, with their growing economies and relatively low car ownership rates.

But Edwin’s story highlights how much these firms still have to learn to be able to operate in economies like Kenya’s, where an unstable reality clashes with its world of automated pricing.

Read the full story here.

The Tesla logo is seen through a charging station outside a store of the electric vehicle (EV) maker in Beijing, China January 4, 2024. REUTERS/Florence Lo

The European Commission released a new draft of its proposed tariffs on China-made EVs with just a few tweaks, including lowering the highest tariff level to 36.3% from 37.6%.

The biggest news was for Tesla: the U.S. carmaker, which imports cars to Europe from its Shanghai plant, will only need to pay 9% tariffs on its vehicles, down from a previous estimate of 20.8%.

Tesla had requested a recalculation of its rate when the first list was released, and it worked: it is now the lowest tariff of any carmaker.

VW and BMW will also get a better deal for their China-made EVs, the Cupra Tavascan (made by Volkswagen’s SEAT subsidiary) and the electric Mini. Previously, both cars were going to be slapped with the highest tariff of 37.6%, but the carmakers asked the EU to reconsider, arguing that they hadn’t been able to provide all the details required in the investigation because the models weren’t yet being exported. The tariff on both models has now been reduced to 21.3%, in line with other companies classed as cooperating with the investigation.

None of this is final: the investigation will carry on for two more months, and the final duties need to be voted on by the EU’s 27 member states. What this does show is that although there is evidently a bit of wiggle room, it doesn’t seem as though negotiations between the EU and China are going well enough to get rid of the tariffs all together.

President of the United Automobile Workers Shawn Fain speaks on Day 1 of the Democratic National Convention. REUTERS/Brendan Mcdermid

United Auto Workers President Shawn Fein made his allegiance to the Democrats clear as day at the opening of the Democratic National Convention last night, appearing in a “Trump is a scab” t-shirt to pitch Kamala Harris as the candidate of the working class.

A “scab” is a worker who refuses to join a union or an individual who crosses a picket line during a strike. Both Biden and Harris have shown up at picket lines to support striking autoworkers in the past, while Trump is facing a complaint from the UAW accusing the candidate of attempting to intimidate workers in his conversation with Elon Musk last week.

The UAW is launching a country-wide effort to mobilise its one million active and retired members to campaign and vote for Harris, going door-to-door and engaging with others online.

The union’s influence and membership are concentrated in Michigan, with a whopping 9.2% of Biden’s vote in the state coming from UAW members in 2020. It’s also strong in Wisconsin, Ohio, and Pennsylvania, all key swing states that could sway the outcome of the election.

Trump has managed to draw some UAW members to his side who say his record on trade and tax benefits the auto industry more than the Democrats’ proposals. But overall, unions have come out strong for Biden and now Harris, with seven speaking at the opening of the DNC last night.

South Korea’s ministers met to talk about how to tackle EV fires which are worrying customers and contributing to low demand for electric cars. As a start, the country is encouraging automakers to disclose the manufacturer of the batteries they use. But analysts say this doesn’t go far enough – there isn’t much data available for consumers to assess which manufacturer has lower fire risk, so knowing their name won’t be much help.

Stellantis shareholders in the United States sued the carmaker for defrauding them by concealing rising inventories and other weaknesses before posting disappointing earnings that caused its stock price to fall. Shareholders said Stellantis artificially inflated the stock price with positive assessments of its financial wellbeing. Such lawsuits are common in the United States after unexpected price declines.

China’s Ganfeng Lithium Group has signed an agreement with a Turkish battery producer to set up a $500 million JV for lithium battery production. It plans to build a plant with caapacity for 5 gigawatt hours per year, according to a stock exchange filing.

GM is laying off more than 1,000 salaried employees at its software and service unions units in an unusual move, with most car companies levelling up their headcount in tech. GM said the cuts were not because of cost savings but followed a review of operations after the departure of Mike Abbott, executive vice president of software and services in March who left due to health reasons.

The leader of Chechnya published a video of himself driving a Tesla Cybertruck with what looked like a machinegun mounted on top, saying he would send it to the Ukraine conflict zone. “We… await your future products that will help us finish the special military operation,” Kadyrov wrote in a message directed at Elon Musk on the Telegram messaging app, using the official term by which Russia describes its war in Ukraine.

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