I will continue to insist that the unseen hand in most automotive transactions is currency. A weak Korean won and a strong U.S. dollar helped build Hyundai and Kia, whereas a weak dollar and a strong deutchmark killed Ford’s greatest product: the Merkur XR4Ti. While tariffs are taking a bite, the relative strength of the dollar over the Japanese yen could work to the advantage of some automakers.
Specifically, I’m talking about Mitsubishi. I haven’t written much about that automaker here in The Morning Dump lately, mostly because there hasn’t been much to write about. Now, with tariff rates down to 15% for Japanese automakers like Mitsubishi, fleet sales are suddenly in the mix again.
Toyota is smart, as I’ve said, and it’s also profitable. I doubt fleets will play a big role in the company’s strategy for the rest of the year, as the company has revised up its profit forecast (from ‘meh’ to ‘not so meh’). BYD is another company that’s smart, albeit new. It’s also starting to replace Tesla in certain markets in Europe.
What won’t replace Tesla is hydrogen, at least according to a recent forecast.
Currency Rules Everything Around Mitsubishi, CREAM
Mitsubishi is now a company that imports 100% of its cars, meaning that it is acutely at risk from trade war shenanigans. The recent lowering of Japanese import tariffs to 15% is maybe not as existential to a company like Toyota, which builds here, doesn’t discount much, and has a lot of higher margin vehicles. It is a big deal to Mitsubishi, and you can sort of suss out where the line is for the automaker from this Automotive News story:
When tariffs were at 27.5 percent, Mitsubishi dialed fleet sales down to zero, executives said.
“With the tariff now at 15 percent and considering the exchange rate situation, we’ll focus on fleet sales and company car sales for vehicles currently in stock that are profitable and meet customer needs,” Nakamura said, adding that talks are underway with rental companies.
“Negotiations are nearly finalized,” Nakamura said. “We expect to increase fleet sales toward the end of the year, which will help recover the volume.”
Fleet sales are usually to rental car companies and government agencies. Company cars these days are gas-monitoring companies, last-mile delivery, et cetera, and not as much traveling salesmen. These are bulk deals and come with bulk discounts, which means lower margins. If there’s a 27.5% tariff, then automakers like Mitsubishi have to sell to private customers at a higher margin to not lose money (or lose as much).
Somewhere between 15% and 27.5% there’s a zone where fleet sales are, if not profitable, more palpable. Given that the company is forecasting an operating profit below $70 million for the year, the margins are still probably as thin as the tires on my BMW.
But there’s another factor here, as the article points out:
Mitsubishi thinks the Japanese yen’s recent slide against the U.S. dollar enables exports to eke a profit, even with the 15 percent tariff rate, Executive Vice President Tatsuo Nakamura said.
CREAM! Mitsubishi builds cars in yen and sells them in sweet, sweet greenbacks. Back in 2020, a dollar bought you about 100 yen. Today, that same dollar buys you about 150 yen. So long as the yen stays down, there’s enough of a spread there to keep Japanese imports profitable enough to bleed inventory to fleets.
So, yeah, if you get a new Outlander at the Enterprise counter, you can bother the people waiting in line by using the word “arbitrage” a bunch of times.
Toyota Expects To Make $19 Billion, Which Ain’t Terrible
It’s purely a cultural thing, but I love that Japanese automakers always use this visual conceit of execs standing at a dais in front of a big screen. The lower angle always makes it look like they’re about to address the Imperial Senate or whatever. The dopey American equivalent may be an exec in Carhartt wearing a high-vis vest, like Paul Jacobson spends his off-time running the punch press at Hamtramck or whatever.
Anyway, Toyota is out with its latest numbers, and the big ticket items are a 900 billion yen ($5.8 billion) tariff hit and an expectation that the company will still make, like, $19 billion this fiscal year (which ends in March 2026). That’s way down from the $31 billion it made last year, but a positive number is probably better than what Nissan is going to do.
BYD Beats Tesla In The UK, Germany Is Not Far Behind
Last year, I filed a TMD from the Goodwood Festival of Speed in Britain, and I was impressed with how well the locals were taking to Chinese electric automaker BYD, which had one of the biggest displays.
[T]he whole BYD stand was full of people every time I walked by it, with potential customers checking out the various real vehicles on display. On one end were the Yangwang luxury cars and the Denza van. On the other side with the BYD Atto 3, BYD Seal plug-in hybrid, and the cute BYD Dolphin.
The nearby Honda stand had a few cars on display as well and did attract some attention, but only about half of the number of people were around Hondas as were around the BYDs when I checked.
I eavesdropped on a few conversations with British consumers checking out the various models and no one seemed to care or even mention the fact that they were Chinese-built/Chinese-owned cars. People were mostly curious about the cost and excited about the features.
That’s why I’m not surprised by this report from Bloomberg, showing that BYD is doing well in both the UK and Germany, and is supplanting BYD in both markets:
BYD Co. is building a lead over Tesla Inc. in the UK and is now neck-and-neck with the Elon Musk-led company in Germany, two of Europe’s biggest markets for plug-in cars.
In the UK, the Chinese manufacturer registered almost seven times more new cars than its American counterpart last month, the country’s automotive trade group said Wednesday. Year-to-date, BYD’s sales have soared more than sixfold, while Tesla’s have slipped 4.5%.
In Germany, BYD registered more than four times as many vehicles as Tesla in October, according to the Federal Motor Transport Authority. Through the first 10 months of the year, BYD trails by only 424 cars.
Is BYD gonna do it this year? I think BYD has the juice. Also, the CEO of BYD didn’t piss off something like half the German population.
Hydrogen Fuel Cell Vehicles To Make Up… 0.22% Of The Global Light Vehicle Segment By 2037
I am totally fine to be wrong about hydrogen cars never being a thing, no matter how hard some automakers try to make it one. More ammo in my belt is the latest forecast from S&P Global Mobility, which is for FCEVs to still only make up a tiny fraction of the total population of cars in 2037:
Compared to BEVs and hybrids, FCEV uptake is expected to be limited throughout the next decade. Even by 2037, FCEVs are expected to make up only 0.22% of the total global light-vehicle market, while BEVs are forecast to account for more than 50%.
S&P Global Mobility forecasts FCEV demand in the light-vehicle segment to increase from 9,211 units in 2025 to 220,000 units in 2037. As of 2025, Japan and Korea dominate the light-vehicle FCEV market, generating 71% of total demand.
This limited adoption is reflected in S&P Global Mobility’s fuel-cell stack demand forecasts from March, June and October 2025, which have notably declined. The June forecast is just 9,341 units, almost 33% less than the March forecast, while the latest October 2025 forecast predicts demand to drop further to 8,079 units—approximately 38% lower than March and 7% lower than June.
Unlike EVs, which you can just plug into a wall, FCEVs require filling stations packed with hydrogen. It turns out, running these is hard, and now most fuel companies don’t seem interested in supporting the tech.
What I’m Listening To While Writing TMD
Alanis Morissette sold 33 million copies of her first album, which is something that might never happen again. She can do whatever she wants, so she did a languorous cover of “My Humps” by Black Eyed Peas, and it’s ridiculous, but I love it. The video is also extremely silly. Apparently, Morissette was in a writing funk and thought it would be a fun thing to do to get out of it. Deep respect. I do that sometimes. I’m like “I’ll do a Matt Levine” or a “Dan Neil” or a “Jean Jennings.”
The Big Question
What’s the best rental car you’ve ever gotten? What’s the worst?
Top photo: Mitsubushi/Hertz
Hey Matt you have BYD beating BYD beating BYD in both markets I assume you meant Beating Tesla?
A PT Cruiser I drove from Newark to Columbus with wife and two kids and luggage was a bad idea. Sucky car and no room.
Had a nice new Honda Civic Sport on a trip from Chicago to Michigan to Ohio. Not a fan of its braking while on cruise, since I can brake just fine with my own foot, and it’s my decision, not some engineer’s.
Best rental was a base model F-150 crew cab. I usually rail against full size gargantuan monstrosities like that, but driving one, I quickly understood why people buy them – it was great. But yes, huge!
Correct me I’m wrong but doesn’t this mean individuals who actually bought a Mitsubishi will see their cars depreciate far more rapidly than usual in the coming years?
Could a Mitsubishi replace the Altima as the “flooded market” pre-owned dealer special?
My takeaway? $12 billion dollars (or likely more) in price hikes are coming soon. After all, the line cannot be allowed to go down.
That’s a hell of a trick. 😉
Best rental? It was a long time ago, but probably a Chrysler LHS. I wasn’t old enough to drive back then though. I had a Maxima once when my car was in the shop that was pretty nice too. Otherwise, it’s mostly been pretty basic stuff like Altimas, Escapes, and various Kias.
Honorable mention to the Versa Note I drove home in a snowstorm when my flight got cancelled. Not that it was a spectacular car, but it was so much better than I expected.
Worst? Without question the Hyundai Accent I got during my orientation trip for work. I rarely complain about the steering feel of an economy car, but navigating a cloverleaf exit in that thing was an exercise in frustration. It also had no cruise control.
Best rental. reserved an Econobox they were out and got an Infinity Q60. Worst got a HHR once, no one wanted it.
I used to travel about 46 weeks a year. Worst by far was a Yaris I got in Boston. What a miserable turd that thing was. Best? I’ve had some good ones, but the best was an SRT-8 Challenger I got in Orange County CA. They were behind at the rental agency and when the agent saw my status at the time, she asked if I would mind a Challenger. I said sure expecting a rental-spec 6 cylinder model, but then I heard the engine fire up from across the garage. Yeah, I can make that work…
I’ve rented an awful lot of cars over the years, so I’ve had a lot of good and bad experiences.
I think probably the worst was during the pandemic when rental car companies were keeping cars longer than usual, so I got a Chevy Malibu with 125,000 miles of hard rental abuse. It has all kinds of issues, and Hertz response wasn’t even a shrug.
Best was probably the free upgrade from a midsize sedan to a loaded Expedition EL last year. I had four other people with me for a month, so not being squeezed into a Sentra for that time period was extremely appreciated.
I just remembered my actual worse experience – a Nissan Murano with a messed up infotainment system that also had a dying CVT, which completely gave up in the middle of a busy intersection on my way to returning the car. It was a really annoying 1500 miles in the car between those two issues, but at least Enterprise gave me a refund for the trouble.
I’m a bit older than most people here likely but I spend a lot of time with friends younger than me so I usually get (or at least have heard) the various slang and cultural references here. I’m at least better than David T.
However, I have no idea what is meant by using “CREAM” in this context and I have mild fear of what might be returned in searching for it.
Currency Rules Everything Around Mitsubishi is a play on Cash Rules Everything Around Me, made famous by Wu-Tang Clan in 1994.
Ah yes. Just like when I’m confused at work when everyone uses acronyms without obvious reasons.
Thanks!
Best: Factory-fresh Pacifica (in a real color!) for a family trip in South Carolina. My two-year-old son loved it and I loved seeing his reactions to it.
Worst: Chrysler 200 when my Acura got hit. I worked for Honda at the time and seriously questioned the existence of any product testing program at Chrysler.
Honorable mention: Florida-plated Passat with requisite window tint that got a ticket for said tint in Portland. Took that car right back.
CREAM:
In a white car with black tinting in the Avis
Black wheels cheesy, no gold bezels, tired style
The worst I’ve ever had was a Nissan X-Trail. It probably wouldn’t have been horrible, but we were in Edinburgh. I had requested a compact car and they gave me a “complementary” upgrade. I should have refused but I thought it might not be that bad once we got out of the city.
In close contention was a Prius C. It may have been because it was a rental and therefore not maintained well, but it struggled to reach and maintain 65 on the highway. It also felt like it was made from leftover scraps from other Toyotas.
Best is probably a 4 cylinder Camaro convertible I rented in Miami.
No one really wants to park a car in Britain, let alone one larger than they have to.
On that theme, I was handed the keys to some Peugeot 5008-type thing and hated every minute of that car. It was too large for the sole purpose of moving me from A to B.
Regarding the title, I sure hope so too. Who wouldn’t like renting a vehicle with the best in transmission design?
Matt Levine is a hard act to cover but a very good stylistic influence.
The local Enterprise has 4 Mirages sitting out front. And I think they are really there and it’s not just my eyes playing tricks on me. So I won’t be choosing sub-compact if I rent from there.
The rental place that drops cars at my office has some nice stuff that we get occasionally when selecting a mid-size. The nicest was probably an S-class Merc.
*snert*
Britain doesn’t really have a domestic car industry. Brits are also known to buy cars from wherever they’re cheapest, even from behind the former Iron Curtain (Dacia/Skoda). Maybe they just don’t care.
As for rentals… about 10 years ago I needed a one-way rental from FLL-ATL. Best price I could find online was from SIXT, a European behemoth which at that time was just starting its US operation. I reserved Hyundai Accent (or similar). When I got to their off-airport location, the manager was behind the desk and said, “I’ve got a nicer car that I need to get to Atlanta. Would you mind taking a MINI Cooper?”
Seemed like a fine idea to me, but that MINI was an absolute dog. When I got to the end of the supplied first tank, I realized that the car wanted premium gas, and that’s what I filled up with. Then the car became rather a hoot to drive!
Of course, right before I returned it at ATL, I filled it up with regular 🙂
I very rarely rent cars, so my experience is limited. My personal Best & Worst are actually probably not that far apart, objectively.
BEST – a 2012 Camry I rented in Montana for about ten days. Considering that my daily driver then was a ’95 base Neon, the Camry was pretty swanky, and blasting down I-94 between Billings and Miles City at about 110mph the whole way was an absolute hoot. I have no idea how I didn’t get a ticket that afternoon.
WORST – a 2020 Nissan Murano, while my truck was in the body shop. Nothing really wrong with the vehicle itself, it was comfortable and drove well around town. However, that was my first infotainment screen…trying to figure that thing out, especially while driving, was terrifying. I turned it back in to Enterprise after 3 days…I just couldn’t handle it anymore. I just rode my bike to work for the next 4 days.
I live in mortal dread of the day that I have to buy a new vehicle. Slate’s the only thing that won’t have a big screen in the middle. Hopefully, my Tundra will last me another 20 years.
You just reminded me of the Murano rental I had back in 2018. It had all kinds of issues, most notably an infotainment screen that would lock up (and hold the last noise it was eminating until the power was cut, which got real old when it happened on the freeway and the next exit was 15-20 minutes down the road).
Hyundai has great infotainment these days and my favorite feature is the ability to turn the damn screen off when you’re not using it.
My god! That haunting Alanis Morissette cover of My Humps is like that dream/nightmare/out-of-body experience I had the night I ate too much Vindaloo and drank too much tequila.
Worst Rental Car is easy. 60k Mile RWD Charger with 3 different brands of all bald tires, in January, to go to State College PA. It was snowing the entire time. Something on the accessory belt circuit was completely thrashed, and the poor Pentastar V6 sounded supercharged.
The worst was a U-Haul truck I rented in the 1990s. It was old – very old. It had a vinyl bench seat, no AC (no bueno for a July rental), and a 4MT with a super-low first, aka granny gear. I’m not sure if the radio had FM to go with the AM 😮 However, it did the job so I can’t complain too much.
The best one was more about the situation than about the car. I had to be in Silicon Valley for a week, and decided to fly into SFO (lots of flight options to/from) and drive over. When I got to the rental counter, it was mayhem with some added bedlam. All of the customers ahead of me seemed to be angry, frustrated, etc. so I just stood there quietly. When my turn came, the next available CSR was the manager – clearly having a bad day. I greeted him pleasantly and handed over my license and corporate credit card: his mood changed immediately.
He said “Let’s see… Would you like an SUV or a convertible?” *pause* “I bet you’d like a convertible.” And he handed me the keys to a droptop Mustang. It was a V6 and AT, of course, but I put the top down and had a pleasant week of driving around.
I also have a nomination for the rental car which was simultaneously the best and the worst: a Smart Four Two (sorry Mercedes). This was a trip from Valencia to Cuenca in Spain and the mate I was travelling with was supposed to organise the car. He didn’t and we ended up going from rental desk to desk begging for anything. We got a Smart. On the motorway out of Valencia it was ghastly. Spanish motorways are (or were) basically engineered by angels and cry out for power to make the most of them. The Smart struggled, handled poorly, had this weird laggy gearbox and got bounced about every time we were overtaken by a truck, which happened at regular intervals, in a way which made me worry for the state of my underwear. .
But when we got to Cuenca, it was brilliant. Tiny narrow medieval streets with sod all parking suddenly became easy (or easier) to navigate. Tiny size, a good turning circle and good aircon were all I could have asked for, and made me completely reconsider the car. At least until we had to drive it back to Valencia again…
Spouse still teases me about the buzzy, wheezy little SmartForFour we rented in Denmark.
That’s just a worse Mitsubishi.
There was an interesting story last week the idf leases SUVs for its officers they had Chery’s and now they are getting outlanders because of security risks that they thought they addressed they also leased mgs for base security and are trying to figure out if they made a mistake. With the Israelis I always wonder if they found an actual security problem or something strange they could use.
I think my worst rental was a Bolloré Bluecar but Chevy sonic and pt cruiser are up there.
I was probably most impressed and shocked by a 5.0 genesis shorty after they came out. I never mind a f150 or ram 1500 sometimes I would get a regular cab. I was impressed with a Gv80 I got because they were begging people to take evs.
Best rental was a Honda N-ONE base model a few years ago. I’ve driven small Hondas my entire adult life, but the little kei car outshines everything in terms of fun
I’ve had two rental convertible Mustangs in Hawaii. That’s tough to beat, just for the setting. Most recently we had a Ford Escape which was surprisingly good!
Worst rental was a Kia Sedona (?) minivan with like 100k on it, that things was a piece
Sometime in spring 2006 I had to fly to Germany for work for a week or two. The rental car place gave me a really nice Mercedes CLK Cabrio (I was maybe 29 at the time so nice by my standards). The car had wide summer tires and the first afternoon I was at work, we got about 4 inches of wet snow. I couldn’t even get enough traction to get over the small concrete lip on the parking spot, so I abandoned the car at work and took the bus for the next two days until it stopped snowing.