This week we are joined by a special guest, Lisa Krusemark, Industry Analyst at CAR. Lisa covers and shares her thoughts on the latest Hot Topics happening in the automotive industry.  If you would like to receive this bi-weekly insight into critical industry issues you and your organization are facing, sign up for our mailing list  here  to get Hot Topics sent directly to your inbox.  


Nissan & Tesla Safety Recalls: 

Lisa’s thoughts:

Recall warnings are being issued for owners of older vehicles due to Takata airbag inflator malfunction risk. The recent recalls for Nissan are tied to another fatality linked to an exploding inflator on the front-passenger side. The Takata airbag inflator malfunctions have led to 27 fatalities and over 400 injuries in the United States, dating back to initial reports from 2018 and injuries beginning in 2015. The Nissan do not drive warnings are linked to models spanning from 2002 to 2006. Overall, there are tens of millions of Takata air bags under recall, and explosions are thought to be associated with long-term exposure to heat and humidity.

As vehicle recalls place the responsibility for bringing in vehicles on the consumer, data shows that only 50-70% of recalled vehicles are repaired (e.g., the recall completion rate). Additionally, it is estimated that up to 25% of all US vehicles in operation have one or more open recalls. Many factors contribute to the low recall completion rate, including ambiguity for consumers about the repair process, severity of the recall issue, and costs. Manufacturers, dealerships, and federal agencies are tasked with reaching consumers for recalls, however, the increasing age of the average vehicle on the road creates additional challenges for automakers to reach owners of pre-owned vehicles.

The number of recalls for electric vehicles, ADAS, and OTA updates has nearly doubled in the last couple of years. As vehicle recalls become increasingly diverse and complex, it is even more important to provide consumers with clarity about the methods used to complete recall repairs. A specific example of the growing recall complexity includes the recent recalls for Tesla 2021-2023 Model S and Model X issues for front seat belt detachments (that require repairs and replacements to front row seat belts). In addition to this recall, Tesla issued a recall for seat belt warning system failures that apply to three different models. Telsa reported that the seat belt alert will be addressed using over the air (OTA) updates which will be deployed this month. The Tesla seat belt recalls highlight how recalls may be either completed by traditional repairs at the dealership or via OTA updates, confirming the importance of educating consumers about how to understand the recalls and initiate repair completion.


Automakers Unveil New EV’s:

Lisa’s thoughts:

New EV model announcements reflect a prominent issue for the automotive industry and the consumer: vehicle affordability. This issue proves critical for EV adoption and the broader new vehicle market, particularly given the average new vehicle price is roughly $47K (as of May). Automakers are moved to produce EVs that are priced in a range comparable to lower-priced models produced in China, but this will likely be limited to specific market segments in the near term.  

Following the announcement that the Bolt was discontinued in mid-2023, Chevrolet announced the Equinox EV as a potentially affordable option within the popular crossover market (with a base price around $35K). European automakers are also motivated to offer affordable EV models with direct competition from Chinese automakers (such as BYD which offers the Seagull hatchback below $22K USD). Volkswagen announced plans for a new lineup of BEVs under $27K by the end of 2025 including a lower-priced compact model. The Stellantis EV lineup promises to introduce 6 to 8 electric vehicles this year, including an unnamed $25K model available later this year. Stellantis also announced their global all-electric SUV Wagoneer S with a starting price of $72K, noting that less expensive models will be released at a later time. GM recently announced a fourth EV in their Cadillac lineup starting at $54K, the Optiq, as a compact and more affordable CUV option alongside their premium counterparts. 

The diversified lineups announced by automakers reflect more affordable EV options that accommodate a variety of consumer interests. These recent announcements appear to demonstrate that lower-price trim lines will become more readily available following an initial model release. The ongoing focus on vehicle affordability as more EVs enter the market is notable to observe, whether you are a member of the industry or a consumer, so stay tuned. 


Carla Bailo

Lisa Krusemark

Industry Analyst

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