It seems like every other week, there’s a headline about how Western automakers’ plans for China haven’t worked out as expected. If it makes you feel any better, many global brands have experienced trouble in the Chinese market. The whole entire thing is down year-over-year by a massive amount, and this should result in two things: domain expansion and survival of the fittest.
At the same time, the Audi A8 is sticking around in America, Russia’s in the midst of an alternative fuel craze, and Ford just recalled the Mustang for an annoying but mildly amusing reason. Welcome back to The Morning Dump, where we do the baby-bird thing of chewing the fat on this morning’s big car news stories so they’re easier for you to digest. Look, I only had three days of taking over this from Matt, so less ridiculous metaphors will return soon.
Big Trouble In High-Tech China
It’s all too easy to look at China’s automobile industry as a monolith. After all, with hundreds of brands on sale, distinction becomes a bit of a challenge. Over the past decade or so, favorable policy (like what we previously saw in the U.S., but even more so) has fueled a new car boom, but now it seems that the chickens are coming home to roost. Overall sales in China are not doing so great, as Bloomberg reports:
Retail sales of passenger vehicles fell 23.2% from the year before to 1.6 million units, China’s Passenger Car Association said on Wednesday. New-energy vehicle sales, including plug-in hybrids and pure-electric vehicles, slipped 9% year-over-year, though the segment still accounted for over 60% of the market for a third straight month.
This marks a continued decline over the last monthly report’s year-over-year drop of 21 percent, and sales of electrified vehicles slipping to near-2024 levels indicates that this isn’t just a matter of only gasoline-powered cars becoming undesirable. When we’re looking at this scale of domestic sales slump on top of massive excess capacity, the next step for many automakers from China is clear: Export or die.
Manufacturers leaned heavily on exports to offset the slowdown. Exports of new-energy vehicles surged over 150% to 499,000 units, signaling that foreign markets are absorbing excess production. Despite a one-fifth drop in domestic sales, BYD Co.’s total shipments rose 5.5%, driven by exports that almost doubled from a year ago.
Indeed, we’re on the cusp of seeing Chinese OEMs venture into markets unimaginable even three years ago. BYD is already listed on Transport Canada’s Appendix G list of recognized foreign vehicle manufacturers, and Chery is testing multiple vehicles in the Greater Toronto Area. At the same time, Europe’s still receiving new-to-them Chinese brands like Aion and Lepas, seeing deeper market penetration. Market conditions in China mean we’re about to see an export push like we’ve never seen before, and it could break either way.
It won’t go well for every brand. Skywell’s U.K. importer has recently waved the white flag, leaving that brand’s British sales future in purgatory. Likewise, HiPhi did try exporting its futuristic EVs but ultimately ended up filing for bankruptcy in China. In some ways, the market’s a lot like the Western car market of 100 years ago. Loads and loads of brands, not all of which will make it. A rationalization is likely coming, but not before a whole bunch of models make it abroad. How confident are you in parts support?
Not Dead Yet
Earlier this year, it seemed certain that the Audi A8 was about to waltz off into the sunset. In the marque’s home market of Germany, it stopped taking orders for its flagship sedan, and there’s no official immediate replacement on the horizon. It felt like everyone was waiting for the bell to toll, yet it hasn’t quite sounded yet. Audi just announced changes to its 2027 U.S. lineup, and guess what’s still here?
Yep, it’s the A8 and its twin-turbocharged V8-powered S8 variant too. The A8 L gains two new wheel options, the S8 gains a new wheel option and standard heated rear seats, but these executive machines are otherwise unchanged from last year. Pricing for 2027 starts at 96,395 for the A8 L and 131,295 for the S8 in case you’re feeling particularly bold.
This continuation is particularly unusual because when was the last time America got a flagship German luxury sedan that the Germans didn’t get? For the past five decades or so, we’ve either seen global models or the really good stuff stay in Europe. Think Mercedes-Benz 500SEL in the days when America only got a 380SEL. While the A8 and S8 probably aren’t long for this world in their current forms, they’ll continue to roll into American showrooms for the foreseeable future, and that’s noteworthy.
From Russia, With Propane And Propane Accessories
It goes without saying that Russia’s car market has been weirder than usual lately. Economic sanctions and other factors have produced fake BMW X5s made from real parts, new cars without catalytic converters, and now the return of a fuel that seemed generally obsolete in North America. It’s LPG, Liquified Petroleum Gas, and Russian drivers allegedly can’t get enough of it. As Reuters reports:
Egor Popov, whose Garant-Gas company fits equipment to convert cars to run on LPG in Moscow, said demand had multiplied.
“We have a waiting list until September,” he said.
That’s astounding because by-and-large, LPG as fuel for cars is generally considered old hat in the west. There was a craze for it decades ago due to its lower running costs and cleaner emissions compared to gasoline, but over the past decade, it’s really fallen by the wayside. Pumps have been closing down, taxi operators seem to be satiated with hybrids, you know the drill. However, the people of Russia face different conditions. Their supply of propane and butane is plentiful, but their supply of oil isn’t the steadiest it’s ever been for obvious reasons. Another installer whom Reuters interviewed stated that at-the-pump propane prices are less than half those of gasoline, and given the circumstances, that makes sense.
Granted, LPG isn’t as energy-dense as gasoline. You’re looking at an energy deficit of around 27 percent per gallon, but when the fuel costs half as much as gasoline or less, actual real-world savings-per-mile are there.
Wipe It Down
The Ford Mustang GTD is a $327,960 exercise in just how far you can take a pony car. It may one of the fastest production cars the Nürburgring has ever seen, but it’s still a Mustang, so it’s caught up in an incredibly weird new recall shared with its non-supercar sibling. When it gets really cold outside, the windscreen wipers might only operate at their absolute maximum speed. As the recall report states:
In cold temperatures of 0 degrees Celsius or less, the vehicle’s wiper motor may lose Local Interconnect Network (LIN) communication with the vehicle’s steering column control module. As a result of this communication loss, customers may experience front windshield wipers that only operate at their high-speed setting and an inoperable windshield washing system in these cold temperatures.
Man, not being able to clean your windscreen on the go would suck during winter in salt country [Ed Note: I doubt anyone is driving a GTD in the winter. -DT], to say nothing of the annoyance of blades that wipe either too quickly or not at all. Normally, a LIN communication fault can be traced back to shorts, corrosion, bad grounding, bad voltage, module failure, or just a programming issue. Unsurprisingly, the Mustang’s wiper problem falls under the last category.
The supplier of a semiconductor chip on the wiper motor’s printed circuit board assembly erroneously used a 32-kilobyte programming equipment setting for the 16-kilobyte chip to be programmed with a mismatched 32-kiloybte algorithm. This erroneous equipment setting may result in the LIN communication issue at cold temperatures.
Ah yes, that is quite the oversight. Thankfully, the fix for the 67,842 potentially affected 2024-to-2026 Mustang and 2025-to-2026 Mustang GTD models is just a new wiper motor that’s already in Ford’s parts catalog, so it should be an easy swap with relatively little downtime. Automotive software. Isn’t it lovely sometimes?
What I’m Listening To While Writing TMD
Guys, look, listen. It’s summer, the sky’s clear, I have the keys to a drop-top in my pocket, the vibes are surprisingly good. You know what can make it even better? “U Sure Do” by Strike. What a tune.
The Big Question:
Who will survive in China’s car market?
Top graphic image: Xiaomi
I think BYD is slated to become the ford of 100 years ago and the Toyota of recently. They will be everywhere.
The big old state sponsored Chery, Dongfeng , SAIC, BAIC, and GWM will survive. Along with Geely but they will all probably shed brands and consolidate.
The other state supported brands that have become or created to be western partnerships it’s hard to say but I expect they will live on in one form or another. Wuling, Changan are big enough they probably won’t fail. But might be merged into something else.
Xpeng will be fine and grow but might not remain independent. It used to be geely was the Honda of China now I think that’s a little more like Xpeng.
I’m not sure every Huawei partner will survive but bound to be one or two. Several may merge and it might all just turn into Huawei automotive.
Xionomi will survive and continue in cars.
What happens to Nio will be interesting. Catl already has their main asset. They will fail but might be propped up or merged into something else.
Zongshen will probably be fine not exactly a car company but they will probably lean on their engines for different industries and probably still have some kind of motorcycle.
It’s looking like several Chinese ebike / emoto manufacturers are slated to be household names. They already are for teens. Surron might be the new Kawasaki in that regard. I suspect more will follow. Tutio might be there and there are a few others that might be a flash in the pan or have staying power. They are like the 60s Japanese bikes. In 10 years it will probably be like the 80s for Japanese bikes for them. As all the kids riding them buy bigger and more in their 20s and 30s. I can’t see those kids going to ice bikes.
ok? how does temperature have anything to do with a mismatched algorithm?
“Who will survive in China’s car market?”
-BYD as they seem to be the BEV leader in China
-Leapmotor as well due to their association with Stellantis.
-SAIC will survive with the help of their association with GM/Wuling.
-Dongfeg because they also make a lot of commercial vehicles and they have partnerships with Nissan and Stellantis.
-Chery
-Geely because Volvo and other brands they have
-Great Wall because of their trucks and they make interesting vehicles like the Ora Ballet Cat
TBQ: The same answer it always is in China, from semiconductors to aerospace, it’s always the chosen few national champions who’s executives toe the party line the hardest. So SAIC (IM, Maxus, and hilariously- MG and Buick), Dongfeng and FAW.
Notable in their absence: BYD and Geely. Perhaps if their founders are brought to heel, they might be allowed to stay like Jack Ma and Alibaba.
On the other hand, that does explain why it seems to me like BYD and Geely both seem to be headlining most export stories: those two want to get established abroad and considered essential as fast as possible.
One thing I find odd about Chinese vs. Western cars. In the West, buyers tend to be brand loyal or choose from established brands with positive reputations. But Chinese buyers choose from 100+ different brands, and there seems to be new brands added every month.
It’s like going on Amazon to buy anything and you can get the same item from 100 different “brands” with names you’ve never heard of.
Actually that is not 100% true. Europe is a very loyal / chauvinist market.
But the US isn’t. I would say that of all large established markets it is one of the most (if not the most) open to new brands.
The average American buyer is absolutely not open to new brands or existing brands doing new things. Just ask Fiat, Maserati, Alfa Romeo, Polestar, Honda with the Ridgeline, Nissan with the Titan, the list goes on. the US market is dominated by a few established brands and models (F-150, Silverado, Tahoe/Suburban, Corolla, Camry, Accord, Civic. RAV4, CR-V), and the only new brand that’s been able to find widespread success has been Tesla. Brand loyalty here is passed down through GENERATIONS. Suggest to a Ford guy that he should try a Chevy truck and he might want to throw hands. Rivian and Lucid COULD catch on, but time will tell. Any European brand that wants into the US market will have a hard time because Americans generally associate European cars with being unreliable.
Europe also has a LOT more brands and models to choose from than we do in America. Renault, Dacia, Citroen/DS, Peugeot, Skoda, SEAT/Cupra, Alpine, all the good VWs and Fiats, not to mention all the wacky shit from China.
I am time and I am saying Lucid won’t catch up.
I don’t disagree with you. Lucid’s insistence on sticking with the high-end market is messing them up.
What I’d give for a Cupra and an Alipine. And an ID6 estate
Sales are down a quarter in China because everyone lost like a quarter of their net wealth due to the slow motion housing crash. It may get even worse
While I’m sure most headlines will center of the raw drop in new energy vehicle sales in China they are still rapidly increasing market share. Primarily it is the old state run companies making conventional and crappy ICE vehicles that are struggling the most. It is rapidly getting to the point where you can’t sell a car in China that isn’t at least a PHEV.
I can’t tell you who will survive – I can’t even tell you most of the brand names. BYD will be one of them though.
“…the vehicle’s wiper motor may lose Local Interconnect Network (LIN) communication with the vehicle’s steering column control module.”
Is anyone else worried about the future serviceability of these digitally controlled accessories?
All of these things ultimately have workarounds, but there needs to be the motivation to do so. I mean, how are people fixing their 80 year old analog gear? Most are just replacing entire units rather than servicing
Not really. Most of it will last the useful life of the vehicle and then the vehicle will be replaced. Same as today. People wrenching on 30 or 40 year old cars to keep them on the road are the exception not the rule.
People were afraid of CANBUS and OBD when it got introduced, it’s now largely understood and the cars are lasting longer than ever.
Imo, it’s only an issue if you’re not willing to learn about the new stuff. Old timers and luddites terrified of a multimeter will just start paying those who aren’t.
I’m seeing it in our EV transit bus program. Old hats are scared of it, so the younger guys are getting the clean, quiet and comparatively light work in temperature controlled bays, while the other guys keep getting coated in diesel and oil.
I tell techs all the time. Regardless of your stance on owning/driving EVs, you wanna be WORKING on them. It’s easy work once you learn the systems.
Not particularly. For cars with an actual following or fanbase, there will pop up cottage industries that’ll keep these things running. For those inclined, control boards aren’t particularly hard to reverse engineer, and improvements will be made. Not car related, but I have an example. Since Micro-USB has largely been abandoned in favor of USB-C, and with Micro-USB also being kind of fragile, there’s a few guys out there making USB-C conversion kits for various Micro-USB applications. A couple years ago I picked up a conversion board for my Playstation 4 controller. The thing was 10 years old, and I was able to upgrade the battery and modernize the charging port .
I imagine there will be more and more ‘raspberry pi’ type options in coming years for nearly every application and more skilled programmers to make it happen.
Somehow, Buick
Maybe. They are down to 436,729 sales in 2025 from a peak of 1,229,804 in 2016
-Cries in Chrysler-