On a bi-weekly basis, the Center for Automotive Research (CAR) welcomes our audience to decompress with our President and CEO, Alan Amici, as he covers and shares his 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.  

The Pause on Lithium Investments & Loans: 

• GM delays lithium investment amid falling prices and election uncertainty 

• Piedmont Lithium pulls US government loan application as prices slump 

• Wary of Trump, US minerals projects rush to close government loans 

Alan’s thoughts:

Investment in lithium mining has paused as the underlying financial conditions have shifted. EV demand has softened, and China’s overcapacity has created downward pressure on lithium prices. Investment assumptions such as commodity prices and mining company stock prices have decreased, causing investors such as GM to reconsider timing and investment terms. 

At the same time, government funding through the Loan Program Office (LPO) requires due diligence from subject matter experts and regulators that may not be completed until Q1 2025. A change in the political administration may alter clean energy loan policy and availability of loans. 

Unions Negotiate Against VW German Plant Closures: 

• Unions pledge to leave ‘no idea unexplored’ in tackling VW crisis 
• ‘A declaration of bankruptcy’: Unions lash out as Volkswagen weighs possible German plant closures 
• Volkswagen considers historic German plant closures in cost drive 

Alan’s thoughts:

Volkswagen employs 680,00 people globally, with 290,000 based in Germany, and has maintained an employment agreement with German unions since 1994. In the wake of Asian competition and EV market uncertainty, VW has embarked on a $11 billion cost-cutting initiative. VW management has indicated that this may drive the closure of one assembly plant and one component plant in Germany. Union officials are vehemently opposed to such a move and are working to have all options on the table, including 4-day work weeks, previously implemented during earlier crises. 

The industry will be watching as one of the world’s top vehicle producers faces what could be an existential challenge. Will global automakers be able to get their cost structure competitive with Asian competition? Can automakers adapt their portfolios enough to meet shifting consumer demands? And can unions and management find common ground to preserve jobs while improving productivity? These are critical questions that everyone will be eager to see unfold. 

The Future of Hydrogen: 

• BMW plans to bring its first hydrogen car onto the market from 2028 
• Abu Dhabi to invest billions in Exxon’s Texas hydrogen project 
• ‘Transformational’: how a California city launched America’s first hydrogen-powered passenger train 
• Feds grant $4.8M for hydrogen fuel research, fueling station at WSU 

Alan’s thoughts:

BMW has partnered with Toyota to develop a hydrogen-based passenger drive unit to power an existing model scheduled for release in 2028. Co-developing with Toyota allows for both cost and knowledge sharing between the two companies. The drive unit could also be adapted for commercial truck usage, long identified as the primary market for hydrogen fuel cell applications. Is this a repeat of the EV transition which is experiencing the confluence of propulsion technology migration, infrastructure deployment, and federal regulations? I think there will be consideration of a nascent hydrogen infrastructure and a practical timeline before the industry jumps headfirst into mass marketed passenger cars powered by hydrogen fuel stacks. This won’t discourage innovators like BMW, Toyota, and others from laying the groundwork for future propulsion technology. However, a practical infrastructure plan is necessary to make the transition efficient.