S&P Global Ratings has cut its global auto sales forecast, citing a “double whammy” of weakening China demand and rising energy costs, while forecasting softer U.S. vehicle sales. The details: The revised forecast reflects softer demand in China and rising energy costs tied to the Middle East War, which are increasing variable expenses for automakers and suppliers, potentially weighing further on demand if prices remain elevated, according to S&P Global.

Source: Car Dealership Guy

Automakers and suppliers in search of a lucrative side hustle are dabbling in AI, energy and defense as a way to offset stagnant growth in vehicle sales. Why it matters: Carmakers have tried the diversification game before — but today's economic and technological shifts may give those efforts more staying power. The big picture: "What's different this time is that the industry is undergoing structural change," said Lenny LaRocca, U.S. automotive industry leader for KPMG, referring to the industry's forays in the 1960s, '70s and '80s into aerospace, defense and electronics.

Source: Axios

Mercedes-Benz confirmed it will utilize a two-powertrain approach with the upcoming ”Little G" SUV as a way to ensure the brand conquers additional market share with the new nameplate. Based on feedback from U.S. dealers who were told about the model at a Mercedes meeting in March, the SUV will be offered with both internal combustion engine and battery-electric powertrains. “The clear feedback from our U.S. dealers…was we need an ICE version,” Mercedes-AMG CEO Michael Schiebe said during a May 19 roundtable here. “We said ‘Yes, OK. Let’s put an ICE version in there.’ It needs to have enough power and it will definitely happen.” 

Source: Automotive News

General Motors (GM) and Samsung SDI have paused work on their $3.5 billion EV battery plant in New Carlisle, Indiana, in response to weaker-than-expected EV demand and shifting federal policies, which prompted automakers to reassess production capacity. While GM plans to complete the exterior construction of the plant, future plans remain uncertain. Originally, the 680-acre facility was designed to produce nickel-rich prismatic batteries. However, construction delays and layoffs are already anticipated in 2025, as consumer demand for EVs has declined, particularly following the expiration of the $7,500 federal EV tax credit last year. 

Source: CBT News

The tire takes data from the road and sends it to your car, to other cars, to the cloud, everywhere. Pirelli just announced a major step forward in its strategy to transform tires into AI-enabled road-monitoring agents, the company said at the recent SelectUSA Investment Summit, where it presented what it has named its Cyber Tire technology. Toward that end, the Italian tiremaker acquired a 30 percent stake in Swedish AI company Univrses, strengthening the integration of advanced computer vision technologies into Pirelli’s Cyber Tire system.

Wait, what is this? “Cyber Tire is the world’s first hardware-and-software system capable of collecting data and information from sensors embedded in tires,” the company said, “processing them through Pirelli’s proprietary software and algorithms, and, by communicating in real time with the vehicle’s electronics, enabling new functionalities integrated with driving and control systems to enhance the driving experience and increase safety levels, as well as supporting connected infrastructure.”

What, exactly, can this do? A lot of things. “The accelerometer detects forces but also road condition, roughness, irregularities, holes, whatever,” said Piero Misani, chief technical officer and head of Cyber Tire business at Pirelli. In addition to, say potholes, it can detect water, ice, or snow on the road and, in the future, anyway, send that data to cars behind it so they know to slow down.

“Cars will be more and more connected,” Misani said. “Of course, this information may be used not only inside the single car for steering and braking control, but also to inform others of critical situations. The point is that the cars are being able to speak to one another. The infrastructure is there. With autonomous vehicles it’s already exactly like this. With V2X, vehicle to everything, the possibilities are limitless.” They’ve been working on this for quite a while. “We started in 2000, so for more than 25 years we have been working on collecting data from tires,” Misani said.

It isn’t easy. “The sensor in the tire is not so simple. The acceleration sensor is inside the tire and therefore has to be able to withstand up to 1000 g’s, it rotates 270 kmh (168 mph). The acceleration on a Pagani or a McLaren is enormous. So, the sensor has to be light, less than 14 grams total including the battery.” The battery is the most difficult component, because not only does it have to function in that high-g environment, it also has to last entire life of the tire. But Pirelli has met all those requirements, it says.

When is the technology going to be in customer tires? Pirelli announced it’ll make the tires in it’s Rome, Georgia, plant, but didn’t give a specific date for start of production. “The start of Cyber Tire production in our Rome, Georgia, plant is a significant milestone for Pirelli in this country,” said Claudio Zanardo, CEO of Pirelli North America. “It reflects our commitment to bringing advanced technologies like Cyber Tire closer to the market, further strengthening our industrial footprint and innovation capabilities in the United States.”

Source: Autoweek

After years of SUV dominance in the U.S. market, sedans may be poised for a comeback as consumers grow frustrated with rising vehicle prices, repetitive SUV styling, and higher ownership costs. Industry analysts say American consumers are beginning to experience “SUV fatigue” after years of crossover and SUV dominance in the market. According to research cited by the Detroit Free Press, younger buyers are increasingly drawn to sedans, with 51% of surveyed teenagers saying they see themselves driving a sedan in the future, compared with 31% who chose SUVs.

Source: CBT News

As dealerships face growing pressure to speed service turnaround and meet rising customer expectations, transportation reliability is becoming a key operational differentiator, not just a supply chain issue, according to Frank Granieri, chief commercial officer at A. Duie Pyle. The details: Granieri told CDG News that freight execution failures increasingly have direct consequences for dealership operations, even when inventory is technically available elsewhere in the supply chain.

Source: Car Dealership Guy

Ford Motor’s stock price has surged to its highest level in nearly three years, and the reason has little to do with cars or trucks. Over the past two weeks, Ford stock has risen 28% after the company announced a new energy-storage subsidiary, Ford Energy. That division, which launched with a $2 billion investment, seeks to turn batteries once destined for electric vehicles into stationary energy-storage systems for artificial-intelligence data centers, power utilities and large industrial customers. The move puts Ford in competition with other major battery-making companies such as Tesla and LG Energy Solution.

Source: Wall Street Journal

Shares of luxury carmaker Ferrari fell sharply on Tuesday shortly after the company launched its first fully electric vehicle. The Maranello, Italy-based sports car manufacturer unveiled the Luce, which translates as “light,” at a venue in Rome, describing the choice of name as one that “evokes clarity and direction.” The highly anticipated model marks a departure from the aesthetic of typical Ferraris and comes even as other luxury car manufacturers, notably Porsche and Lamborghini, have scaled back on plans to launch their own EVs due to weak demand.

Source: CNBC

Inventory of used vehicles is expected to get a big boost soon, with up to half a million units coming off lease. Edmunds reports the surge in inventory from the leasing market will be short-lived and feature more EVs and hybrids. The leasing market began recovering from the post-pandemic plunge in 2023, with lease penetration jumping from 18% in 2022 (2 million units) to 21% (2.59 million units). 

Source: Car Dealership Guy