I might be prepared to guess that extra German vehicles are made within the Deep South than a lot of their drivers even understand. For many years now, BMW and Mercedes-Benz have made robust use of American labor, turning out SUVs from their factories in South Carolina and Alabama, respectively. Actually, BMW is definitely the most important automotive exporter by worth in the USA.
These investments have confirmed to be helpful tariff armor in President Donald Trump’s second time period. The opposite German luxurious model, Audi, hasn’t been so fortunate, because it has no factories within the U.S., and being so import-heavy is hammering its backside line. Now, Audi could flip to Scout Motors for assist, and in a approach that would circumvent the necessity for a U.S. manufacturing unit—possibly.
Get this roundup in your inbox each morning.
Important Supplies will quickly be an e mail e-newsletter as properly. Get at this time’s most essential automotive information proper in your inbox each day. Join right here.
Welcome again to Important Supplies, our morning roundup of trade and expertise information. Additionally on deck at this time: Toyota has a plan to stretch its vehicles’ lifespans longer, and South Korea is pouring cash into EV subsidies. Let’s dig in.
30%: Audi’s Subsequent Massive SUV Might Be A Scout EREV
Scout Terra Idea with Harvester EREV
Picture by: Scout Motors
EREVs—extended-range electrical automobiles—appear to be the following massive factor. You are taking a devoted EV platform, able to software program updates and all these good issues, and also you add in a fuel engine purely to recharge the EV battery. It offers clients a well-known expertise whereas eliminating vary nervousness, which is why it is turning into a well-liked selection for automakers planning their next-generation electrified SUVs and vans.
Scout Motors’ EREV vans are anticipated to have round 500 miles of vary, which might be why clients are overwhelmingly choosing that model over the purely electrical one. Now, in response to a report from Automotive Information Europe, Audi might borrow that EREV platform for a brand new by-America, for-Individuals SUV. From that story:
Scout, a Volkswagen Group subsidiary like Audi, is establishing a brand new plant in Blythewood, South Carolina, anticipated to start manufacturing by late 2027. Audi’s new SUV might be an electrical mannequin with a variety extender, designed particularly for American customers.
This strategy will permit Audi to supply automobiles within the U.S. avoiding excessive investments and import tariffs. In an identical approach Audi has launched a brand new mannequin in China this yr, developed particularly for the Chinese language market and bought underneath the AUDI subbrand.
Presently, Audi doesn’t construct automobiles within the U.S., as an alternative counting on imports from Mexico and Europe.
Which is clearly an issue proper now. How unhealthy an issue? Properly:
Audi wants a method to enhance gross sales in the important thing U.S. market. Its automobile gross sales within the U.S. fell 8 % to only underneath 130,000 within the first 9 months.
The slowdown in gross sales, partly attributed to elevated import tariffs underneath the Trump administration, led Audi to decrease its revenue forecast for 2025. Audi CFO Jürgen Rittersberger has warned that tariffs alone will value the corporate an estimated €1.3 billion for the complete yr.
That is about $1.5 billion—a couple of third of Audi’s 2024 international earnings. Ouch.
But turning to an area accomplice throughout the Volkswagen Group household like Scout is undoubtedly cheaper than constructing a wholly new manufacturing unit from the bottom up, which often takes the higher a part of a decade. And whereas neither model has formally confirmed this information, Scout has lengthy mentioned it is open to creating different VW Group vehicles at its plant and sharing its truck and SUV platform. Automotive Information Europe posits that this SUV could possibly be a rival to the Mercedes G-Class or Land Rover Defender, and that is sensible too; everyone knows how a lot Individuals love the pretense of off-roading.
60%: Toyota Will Make Fashions Longer And Rely Extra On Software program
2026 Toyota RAV4 Multimedia
Picture by: Toyota
One frequent criticism of Tesla nowadays is that besdies heavy updates and the Cybertruck, a lot of its lineup is moderately dated. Tesla’s counter-argument is that with software program updates, its EVs get new options on a regular basis and stay aggressive sufficient.
Now, it looks like Toyota is planning an identical technique. Whereas the Japanese automaker’s fame for reliability already is available in half from working powertrains till all of the bugs are ironed out—the 4Runner had a five-speed computerized throughout two generations for about 20 years—it is now stretching the lifespans of its fashions from seven years to 9.
Nikkei Asia studies that the main target will not be on “new” fashions, however “give attention to electrification and sustaining product worth through software program updates.” From that story:
Software program-defined automobiles—whose after-sales performance is enhanced with software program updates and new software program—can provide improved efficiency with out the necessity for brand spanking new {hardware}. This marks a shift from the present trade enterprise mannequin, through which new options are integrated unexpectedly in a reworked automobile.
A median nine-year new-car cycle might be unusually lengthy for Toyota. Full overhauls of flagship fashions had as soon as come each 5 years or so. However as car efficiency improved within the 2000s, the timeframe was step by step prolonged to seven years. The RAV4 sport utility automobile, for instance, might be revamped for the primary time in roughly seven years, with a launch set for fiscal 2025. The exact lengths of the product cycles are anticipated to differ by mannequin.
As that story notes, Honda does new-model changeovers each six or seven years, whereas cash-strapped Nissan is as much as 10. The Chinese language automakers transfer rather more rapidly, nevertheless, and so Toyota will work to match their pace in that essential market.
90%: South Korea Renews EV Push With New Subsidies
Picture by: Hyundai
America could also be slowing down within the EV race, however South Korea’s Hyundai Motor Group nonetheless has to deal with a rising China and different rivals. Now, its house nation is stepping up the EV subsidies, each for carmakers and for patrons. This is Bloomberg:
The federal government is earmarking greater than 15 trillion gained ($10.2 billion), together with low-interest-rate loans and ensures, for home automobile and auto components makers in 2026, the nation’s trade ministry mentioned Friday.
Subsidies for patrons of EVs are set to be elevated by greater than 30% to 936 billion gained, and consumption and acquisition taxes might be waived for all-electric, hybrid gas-electric and hydrogen-powered automobiles. South Korea additionally plans to introduce a trade-in subsidy of as much as 1 million gained for brand spanking new EV patrons who scrap their outdated vehicles.
As well as, the federal government will create a brand new 50 billion gained fund and make the most of an present 150 trillion gained fund for funding in next-generation automobiles, aiming to attain full-fledged home manufacturing of autonomous automobiles by 2028.
Almost all EV, clear vitality and battery subsidies in America got here to an finish within the second Trump period. In markets the place subsidies go away, automakers see a decline in EV gross sales—a significant pace bump at a time once they’re making an attempt to get clients to transition and drive prices down via scale. Final month, the German authorities revived its personal EV subsidy program, although with stricter eligibility restrictions than beforehand.
100%: Does A ‘New’ Automotive Have To Be New?
2026 Toyota RAV4 GR-Sport Exterior 3
Picture by: Toyota
What do you consider Toyota’s plan to increase the life cycles of its fashions? I feel if any automaker can pull this off, it is them, nevertheless it relies on considerably upping its software program recreation—an space the place the Japanese firm is sorely behind many rivals. Tell us what you assume within the feedback.
Contact the creator: patrick.george@insideevs.com
