China EVs & More

The podcast begins with a brief discussion on Ford's accounting of EVs for China and China operations in general. They move their discussion to XPeng's earnings report and take some time to unpack what their troubles were in 2022 and what they're doing to address them now. Lei then summarizes Geely Holdings and their numerous brands and how they all fit together some of the history of a few of the brands that westerners might not have heard of and they both take a few minutes to update on Zeekr. Tu and Lei then give updates on the continuing price war and how it's affected some of the weaker players and foreign brands in particular. Lei pushes the discussion over to Nvidia and how they are likely the largest beneficiary in the push towards more AI use in apps, software and business. The pod closes out with a talk about the struggles of Kia/Hyundai in China and how they still are trying to make headway into the market with the recent announcement of new products. 

Tu and Lei start out the pod with a discussion on the latest price cuts that take the current price war deeper into the hole. They then talk about the VW unveil of the ID.2all and how it may not be that competitive if it was to enter the Chinese market, which currently it’s not set to do.Lei puts the focus on Skoda and their shrinking sales in the China market and how they are doing in other regions. He anticipates that they may ultimately leave the China market due to their continued struggles.Tu updates about the EU’s version of the US Inflation Reduction Act which is called the Critical Raw Material Act or CRMA.The pod closes out with the UK not making the cut for location for the next BYD factory. They didn’t even make the semi-finals and BYD blamed uncertainty in long-term business conditions due to BREXIT as the primary reason. 

In this MAX episode, Lei sits down with Marco Kollmeier, former Executive at Benteler, an Austrian tier 1 supplier that makes it’s bones providing components and modules for the automotive industry, in the areas of chassis, body, engine and exhaust systems as well as future technologies such as system solutions for electric vehicles. A couple of years ago, Benteler’s EV Systems business unit that Kollmeier led developed an EV platform and in an effort to separate the traditional business from the new opportunities in mobility and EVs, last November Benteler spun off that EV Systems BU and the Holon brand was created with Kollmeier peeling off to head that company. For those wondering, HOLON comes from the greek and means something that is both a whole and part of a whole. HOLON recently unveiled its first product at CES, the L4 capable ‘MOVER’ that is based on the EV platform that looks to compete with Cruise, Waymo and Baidu in the robotaxi space. Lei talks to Marco about HOLON and a whole lot more. 

Tu and Lei begin the discussion about the brutal price war that's currently going on in the China automotive sector including where the foreign automakers, SOEs (state owned enterprises) and startups all fit in and how they think it'll affect everyone long-term.They both also discuss the annual Two Sessions meeting that the Chinese govt has each year and try to read between the lines with what's being said and what's actually meant.  The chat moves into a chat about February sales and Tu talks about how western OEMs don't put enough weight on how much the China market means to their success. Tu then moves onto a discussion about the importance of China Battery Inc to the foreign automakers, but not only in China but in their home markets because it's really the only game in town for reliable, competitively priced LFP battery cells.The pod ends with Tu providing a history lesson on the battery cell sector in China and how it built itself out. 

The podcast starts with Tu and Lei having a long discussion about their takeaways from Tesla's Investor Day. For Tu it was all about the ambitious numbers that stood out. Lei thought it was notable that Tom Zhu came out to present. Lei then moves the conversation over to his attending Luminar Day and they both reflect on how important the China market is for Luminar if they're to hit on any of their lofty sales and install goals. The pod ends with Tu and Lei briefly touching on February sales as the sales numbers were beginning to trickle out and what's surprised them so far. 

Tu and Lei talk about the recently announced Leadership change at Ford China and Tu takes a few minutes to give a brief history of Ford China, where he worked briefly in the early 2010s.Lei then shifts the conversation over to letting us know what he learned from the Mercedes Benz digital strategy and OS update in Sunnyvale, CA. This evolves into a broader discussion about Merc's global rollout strategy and how they'll work out the US vs. China vs. EU markets. Tu also points out that Merc will be partnering it's way to a complete HW/SW stack for connectivity and ADAS which is much different than a VW and other legacies who still want to keep most things 'in-house.'The pod closes with a discussion on the new Galaxy brand that Geely unveiled in response to BYD's Yangwang premium brand and they both briefly talk about the differences between Chinese and American's tastes in connected features. 

In this latest MAX episode, Lei catches up with Silvio Angori, CEO & MD Pininfarina SPA who took over at Pininfarina in 2016.For many in the automotive sector, Pininfarina is the epitome of automotive design. Originally established in Turin, Italy in 1930, Pininfarina was a coachbuilder who built cars for companies like Fiat, Rolls Royce and Cadillac. Pininfarina over the years has branched out to provide design services for consumer products, architecture, furniture and e-mobility solutions. One of their recent designs for German startup called Holon was unveiled at CES 2023. Silvio shares his thoughts on the sector, Pininfarina's partnership with Holon that resulted in the L4 capable robotaxi called the Holon Mover and how China is factoring in to all of this upheaval in the space. 

Lei gets right to it by starting the pod out talking about the HUGE Ford + CATL deal, first giving some background and then unpacking what it all means for Ford, CATL and others. Tu prompts Lei to give a download about Geely's new brand - Galaxy (?) and Tu wonders how or more appropriately where it'll fit in their portfolio.Tesla becomes the next topic of discussion, specifically Tesla shutting a line down at ShanghaiGiga to retool for the rumored refreshed MIC M3. Tu also congratulates Tesla for overtaking Toyota for vehicle sales in California, another huge feather in their cap. Charlie Munger's CNBC video interview made a big splash so Tu and Lei spend a few minutes debating whether what Charlie said about BYD rings true. Short answer - YES!Tu and Lei then close out the pod revisiting some of the Ford issues in China. 

Tu and Lei begin this week’s pod with a discussion and what led up to Hesai’s recent IPO and capital raise of $190M. Tu speculates that there are likely companies that have traditionally been suppliers to the OEMs that, due to the current disruption will look to move upmarket to compete directly with the OEMs.The discussion moves over to the launch of the 5-seat Li Auto L7 and what the prospects are for the vehicle and company. Both Tu and Lei seem to be bullish on Li for now due to their entirely (very similar looking) revamped lineup.Reflecting on the market results for 2022, Tu tries to quantify how much market share the legacies have lost in China over just the last few years with Ford Motor’s by far being the most unsettling. Tu goes as far as to state that Geely and BYD are poised to overtake their foreign legacy competitors in sales volume very soon.Lei moves into a review of the January sales numbers and how it seems the price cuts from Tesla worked as their January sales rebounded but other normal and Lei highlights a few EV companies that saw dramatic drops in sales in the CNY shortened January.Tu closes the pod with news that Tesla overtook Toyota to take the #1 spot in vehicle sales in California in 2022. 

This podcast starts with Lei’s headlines but because of the break, there was ALOT to update. Tu then moves the convo over to January sales and they both agreed that it’s hard to tell who did well because the month was shortened by CNY but NIO’s numbers were a pleasant surprise.Tu and Lei then talk a bit about expectations for Tesla and what it’ll take for them to regain their sales growth I China outside of cutting prices on the MIC Model 3 & Y. They move to discuss the recent hiring of Wang Fengying as President of XPeng and what that points to. XPeng along with several other EV makers are in dire need of getting better control of their operations and this is XPeng’s way of trying to do that. Similar to Tesla’s promotion of Tom Zhu, someone with the reputation of managing the teams to be more operationally efficient. Tu closes the podcast out by talking about the current charging situation in the US and what it will take for the infrastructure to be robust enough to support many more EVs and whether swapping would work there.