Honda to restructure China business after over 2 years of talks

Nikkei – SHIZUKA TANABE – December 2, 2025, 07:28 JST

Honda is restructuring its China engine operations as demand for gasoline engines declines and key joint-venture contracts approach expiration. After more than two years of negotiation, Dongfeng Motor Group has agreed to sell its 50% stake in Dongfeng Honda Engine, which GAC Honda will acquire and then convert into a wholly owned subsidiary by year-end. The move ends a long-running rift between Dongfeng Honda Engine and GAC Honda over pricing and profit allocation, while enabling Honda to consolidate engine operations, improve transparency, and streamline costs ahead of major strategic decisions due in 2028, when its GAC Honda finished-vehicle venture comes up for renewal. Honda’s engine JV with Dongfeng has been losing money—posting a net loss of 227 million yuan in 2024—as China’s market shifts rapidly toward EVs and plug-in hybrids. Honda pushed Dongfeng to exit the JV starting in 2023, and worsening market conditions eventually led to agreement. The restructuring is intended to strengthen Honda’s position before renegotiating its broader China partnerships. However, uncertainty remains: Honda’s sales in China fell 20% in the first ten months of 2025 to 520,000 units, far below its peak of over 1.5 million annually from 2019–2021, leaving its post-2028 strategy still undecided. https://asia.nikkei.com/business/companies/honda-to-restructure-china-business-after-over-2-years-of-talks

Chinese EV makers like BYD seen gaining from new UK pay-per-mile tax

Nikkei – CARLA MESSINGER – December 2, 2025, 10:45 JST

The U.K. government’s new budget introduces a pay-per-mile tax on electric vehicles—3 pence per mile for EVs and 1.5 pence for plug-in hybrids starting in April 2028—on top of the road tax imposed earlier this year, raising concerns that higher ownership costs will push consumers toward cheaper Chinese models such as BYD’s Dolphin Surf. Analysts warn the measure could weaken European brands’ competitiveness, with the Office for Budget Responsibility estimating it may reduce EV sales by 440,000 units. Despite announcing £1.3 billion in additional funding for the electric car grant scheme, only four models qualify for the maximum £3,750 subsidy, and even the cheapest eligible option remains significantly pricier than Chinese alternatives. Industry figures argue the U.K. needs more incentives, not additional costs, to support its 2030 phase-out of petrol and diesel cars. Chinese brands—already holding an 11.8% market share and benefiting from state support—face no U.K. import tariffs, unlike in the EU, making the market highly attractive and increasingly exposed to surging imports. BYD’s rapid growth and speculation about potential Chinese EV production in the U.K. highlight growing pressure on local and European manufacturers to respond. https://asia.nikkei.com/business/automobiles/electric-vehicles/chinese-ev-makers-like-byd-seen-gaining-from-new-uk-pay-per-mile-tax

India’s CAFE targets are ‘unscientific’ for small cars without relaxation: Maruti Suzuki

ET Auto – Kriti Saraiya – Dec 1, 2025, at 10:46 PM IST

India’s debate over whether small cars should receive relaxed CO₂ limits under upcoming CAFE 3 regulations is intensifying, with Maruti Suzuki arguing that without such flexibility the proposed targets become “unscientific” for compact, low-emission models. The draft CAFE-3 norms, issued by the Bureau of Energy Efficiency for 2027-28 onward, introduce a revised 909-kg weight threshold that allows lighter cars a 3-gram CO₂ relaxation—an adjustment Maruti emphasizes was created by regulators, not requested by the company. Rival OEMs such as Tata Motors and Mahindra, whose portfolios are dominated by heavier SUVs, oppose weight-based carve-outs, claiming they create unfair advantages. Maruti counters that nearly all major global markets—including Europe, China, the U.S., Japan and Korea—use structured relaxations for small vehicles, and warns that removing weight criteria would force discontinuation of India’s most affordable low-emission cars, despite strong demand and a 37% surge in Maruti’s small-car sales last month. Tata’s leadership maintains that CAFE rules are designed to push OEMs toward greener technologies across their fleets, regardless of vehicle size. As the government prepares to finalize the next phase of CAFE norms, the industry remains sharply divided over how to balance emissions goals with affordability and the future of India’s compact-car market. https://auto.economictimes.indiatimes.com/news/passenger-vehicle/maruti-suzuki-warns-against-unrealistic-cafe-targets-for-small-cars/125696128

How Volvo intends to create the SDV with the assistance of Google

Automobilwoche – Michael Knauer – December 1, 2025, 12:00 PM

Volvo Cars views the upcoming EX60 and its debut on the new SPA3 platform as one of the most significant development milestones in its modern history, marking a complete reinvention of how the company designs vehicles. According to development chief Anders Bell, SPA3 and EX60 were engineered from scratch as uncompromising, fully electric, software-defined vehicles, enabling faster, more robust, and more cost-efficient development across all future models. Safety remains the core priority: continuous connectivity and Volvo’s extensive historical driving-data archive will allow major advancements in active safety over time. Bell stressed that true EV efficiency requires breaking free from legacy combustion-engine constraints, a lesson strengthened by delays experienced with the EX90 and ES90. The EX60, to be unveiled in January, finally meets Volvo’s full SDV ambitions—something many competitors have yet to achieve. A key enabler has been Volvo’s deep partnership with Google, integrating Android and now Google’s AI system Gemini, enhancing voice interaction and in-car intelligence. Earlier work with Zenuity also laid essential groundwork. Bell expects SDV principles to reshape global automotive development, requiring deeper collaboration with suppliers and faster iteration cycles—an area where Chinese manufacturers currently move quicker than European peers. https://www.automobilwoche.de/autohersteller/volvo/amw-volvo-sdv-entwicklungschef-anders-bell/

Power failure: What’s causing massive engine recalls

Automotive News – Richard Truett – December 01, 2025, 07:00 AM EST

Modern engines’ push for higher efficiency, lower emissions and greater power density has made them far less tolerant of manufacturing imperfections, helping trigger recalls or investigations involving more than 5 million engines from five major automakers. Unlike older, larger engines that used thicker oils and could tolerate minor machining errors, today’s downsized, hotter-running, high-pressure engines rely on extremely tight tolerances and ultrathin oil films—making them vulnerable to microscopic metal particles (“swarf”), improper machining and contamination. Thinner oils, tougher bearing materials and higher operating loads mean even tiny debris can cause catastrophic failures such as bearing wear, connecting rod seizure or engine lockup. GM, Toyota, Hyundai, Honda, Ford and Stellantis face massive repair bills, class-action lawsuits and significant brand damage, with individual automakers spending from hundreds of millions to over $5 billion on engine replacements, inspections and extended warranties. Dealership service bays are overwhelmed by labor-intensive engine replacements that disrupt operations and frustrate customers, eroding loyalty. Automakers are tightening manufacturing controls, boosting inspections and switching to thicker oils in some recalled engines, while acknowledging that lessons from recent failures must guide future engine designs. Experts warn that the industry’s move toward thinner oils and higher-stress engines has made perfect machining and contamination-free assembly more critical than ever. https://www.autonews.com/manufacturing/an-spiraling-engine-defects-1201/

These abstracts represent the opinions of their authors and not of OICA. The in-extenso articles are available via the internet link by subscription as they cannot be legally distributed by OICA.

François ROUDIER

Secretary General

OICA

The Nexperia case: the EU caught between US injunctions and Chinese retaliation

Autoactu.com – Bernard Jullien – October 27, 2025

The Nexperia affair has exposed both Europe’s strategic vulnerability and its political dependence in the global semiconductor race. Originally a Philips subsidiary, Nexperia was sold in 2017 to Chinese investors and later acquired by China’s Wingtech. For years, the deal went unnoticed, but in October 2025 the Dutch government abruptly took control of Nexperia—citing governance concerns under an old Cold War law—after apparent pressure from the U.S., which had blacklisted Wingtech in 2024. The move provoked a fierce diplomatic reaction from Beijing and raised fears of major disruptions in Europe’s automotive supply chain, as Wingtech retaliated by blocking exports of semiconductors produced in its Chinese facilities. Nexperia supplies over 110 billion components annually, including key chips for automakers, and its global structure—with manufacturing split between Europe and Asia—made Europe particularly exposed. The Dutch justified their action by alleging financial siphoning and conflicts of interest by CEO Zhang Xuezheng (“Wing”), but observers see Washington’s geopolitical agenda as the real driver. The episode underscores Europe’s fragile sovereignty: its industries remain dependent on globalized, China-linked supply chains while following U.S. strategic imperatives. Beyond the immediate risk of chip shortages, the crisis highlights the urgent need for the EU to build a coherent industrial and investment policy to safeguard technological autonomy. 

https://www.autoactu.com/actualites/l-affaire-nexperia-l-ue-ballotee-entre-injonctions-americaines-et-retorsion-chinoise

Toyota Posts Record First-Half Sales as US Offsets Japan, China

Bloomberg – Nicholas Takahashi – October 27, 2025, at 5:30 AM GMT+1

Toyota Motor Corp. maintained record global sales in the first half of its fiscal year, as strong U.S. performance offset weaker results in Japan and China. Including Daihatsu and Hino, global sales rose nearly 3% in September to 949,153 units, while production increased 9% to over 1 million vehicles. Despite market volatility in China and U.S. trade tensions stemming from President Trump’s tariffs, Toyota achieved record output and sales for seven consecutive months before slowing in August. During the period, total sales grew 5%, marking a record six-month performance. In September, Toyota and Lexus sales rose more than 14% in the U.S. but slipped 1% in China and 5% in Japan due to a Prius recall. In China, domestic automakers such as BYD continue to erode foreign brands’ market share, yet Toyota has regained some ground thanks to its affordable all-electric bZ3X and popular hybrid models. However, a shrinking domestic market and waning subsidies in China present ongoing challenges. Overall, Toyota’s steady global expansion underscores the company’s resilience amid geopolitical frictions, shifting consumer demand, and intensifying competition in electric and hybrid vehicle segments.

https://www.bloomberg.com/news/articles/2025-10-27/toyota-posts-record-first-half-sales-as-us-offsets-japan-china?srnd=phx-industries-transportation

Philippine conglomerates offer inroads for China, Vietnam EV brands

Nikkei – YUKI FUJITA, October 27, 2025, 12:15 JST

Philippine conglomerates are partnering with Chinese and Vietnamese electric vehicle makers to accelerate EV adoption in a market long dominated by Japanese automakers. At the Philippine Electric Vehicle Summit in Manila, Chinese brands like BYD and Zeekr showcased new models, including BYD’s eMAX 9 DM-i hybrid MPV and Zeekr’s electric coupe. Major local players such as Ayala Corp. and SM Group are spearheading the shift by developing infrastructure and financing solutions. Ayala’s automotive arm, ACMobility, became BYD’s distributor in 2023 and plans to double its dealership network to 80 by year-end, while its Bank of the Philippine Islands offers buyer discounts. SM Group’s BDO Unibank recently partnered with Vietnam’s Vingroup to finance its Green GSM EV taxi fleet, operational since June. Alliance Global Group, another key player, opened a Tesla dealership and is installing chargers in its commercial sites. EV sales surged to nearly 30,000 units in the first seven months of 2025, representing 5% of new vehicles and surpassing 2024’s total. Although Japanese brands still hold around 70% of the market, their absence at the EV summit contrasted with the growing influence of new entrants. Ayala’s decision to end partnerships with Volkswagen and Honda underscores a strategic pivot toward the EV era.

https://asia.nikkei.com/spotlight/electric-cars-in-china/philippine-conglomerates-offer-inroads-for-china-vietnam-ev-brands

Geely targets 100,000 UK sales in push to take on Tesla and BYD

Financial Times – Kana Inagaki in London, October 26, 2025

Chinese carmaker Geely plans to sell 100,000 vehicles annually in the UK within three years and is considering local production as part of its strategy to compete with Tesla and BYD in Europe’s second-largest electric vehicle market. The company will launch 10 electric and plug-in hybrid models, targeting a 5% UK market share—well above the roughly 2% held by Tesla and BYD each. Geely’s first UK model, the EX5 electric SUV, will start at £31,990 and rival Tesla’s Model Y. Head of Geely Auto UK Michael Yang noted that the UK remains an open and welcoming market for Chinese automakers, partly due to strong EV demand and the absence of tariffs. Geely may use its existing UK assets—LEVC, Lotus, and others—for local production and plans to hire 300 workers. Despite the UK government’s push to attract EV manufacturing, high energy and labor costs have deterred investment compared with Turkey, Hungary, or Spain. The UK aims to nearly double its annual vehicle production to 1.3 million by 2035, but struggles persist: Nissan is scaling back, and Jaguar Land Rover suffered a major cyberattack. Meanwhile, Chinese rivals like BYD and Chery are rapidly expanding, making the UK a critical foothold for Geely’s European ambitions.

https://www.ft.com/content/b232784b-9d84-4bad-b211-1e20732d68ae

USA: Destination fees surge as rising costs creep onto window stickers

Automotive News – Lindsay VanHulle – October 26, 2025, 11:00 AM

Automakers across the U.S. are sharply increasing destination charges—the nonnegotiable delivery fees added to every vehicle purchase—at the fastest pace in at least a decade. Chevrolet, Ford, and Ram recently raised these fees on their flagship pickups from $1,995 to $2,595, more than double what they charged ten years ago. According to Edmunds, average destination fees rose 8.5% in the 2025 model year, reaching $1,549—up 27% since 2021. Mass-market brands saw the largest hikes, averaging nearly 8%, compared to 3.6% for luxury makers. Factors driving the increases include inflation, rising transport costs for heavier vehicles, and new tariffs imposed by President Trump in April 2025. Analysts note that automakers use these fees to quietly pass on higher costs without directly raising sticker prices. Stellantis now has the highest average fee at $2,120, followed by Porsche, Ford, and GM, while BMW and Mercedes-Benz remain below average. Volkswagen, Mazda, Nissan, and Hyundai have all raised charges between $50 and $200 this year. Automakers justify the hikes as reflecting logistics and tariff costs, but the pattern underscores broader inflationary pressure in the auto sector. Destination fees, once a minor line item, have become a key lever for maintaining profit margins while keeping vehicle base prices competitive.

https://www.autonews.com/manufacturing/an-destination-fee-increases-1026

These abstracts represent the opinions of their authors and not of OICA. The in-extenso articles are available via the internet link by subscription as they cannot be legally distributed by OICA.

François ROUDIER

**Automakers groups warns Nexperia chip supply issue could quickly disrupt production** Reuters — Oct 17, 2025

**Tesla’s European Regulator Says Door Safety a ‘Key Priority’** Bloomberg — Oct 16, 2025

**Why Skoda is sticking with combustion engines for small cars for the time being** Automobilwoche — Oct 16, 2025

**Horse power: Renault-Geely engine unit speeds up as EV shift stutters** Reuters — Oct 16, 2025

**Batteries, machines, rare earths: China tightens rules – what you need to know** Automobilwoche – Hans Evert, Micha Gebhardt, Frank Volk — Oct 15, 2025

CHINA tightens export licensing on select rare earths, magnets, processing equipment and high-density batteries, with extraterritorial reach. Automakers expect paperwork delays, not immediate shortages; Verband der Automobilindustrie (VDA) e.V. warns of supply risks. Licensing may take up to 45 working days, letting Beijing influence foreign cell-plant timelines and costs.

https://lnkd.in/eSmEfuRU

**Hyundai Pivots to Hybrids as It Unveils $5 Billion India Plan** Bloomberg — Alisha Sachdev — Oct 15, 2025

Hyundai Motor Company shifts hashtagINDIA strategy to hybrids, committing $5.1bn to 2030 for eight hybrid SUVs, five EVs, localized R&D/batteries, 26 models and flexible plants. Targets >15% share, premium mix, $11bn sales; electrified vehicles to reach 60% sales by 2030. Tarun Garg named India CEO in 2026.

https://lnkd.in/etPZ22KM

**Norway proposes widening EV tax to include mass-market Tesla models** Reuters — Terje Solsvik, Nora Buli — Oct 15, 2025

NORWAY will phase out hashtagEV VAT perks: threshold cut to 300,000 kroner in 2026, full VAT in 2027; higher fossil-car levies maintain EV advantage. Impact hits Tesla Model Y prices. Government says incentives succeeded; EV association warns of rebound to combustion. Minority cabinet needs backing.

https://lnkd.in/etyc9PTz

**BYD cars now generate over 100 million km of assisted driving data daily** CnEVPost — Phate Zhang — Oct 15, 2025

BYD logs ~110 million km of assisted-driving data daily; 1.7m vehicles now equipped. In September, 295,606 such cars sold (91.3% of China sales) across BYD, Denza, Fang Cheng Bao, Yangwang. “God’s Eye” A/B/C stack expands; Huawei Qiankun on select models. Data flywheel accelerates algorithm iteration.

https://lnkd.in/eYQ2gQTx

**China’s power battery installations jump 39.5% YoY in Sept. 2025** Gasgoo — Oct 15, 2025

China installed 76 GWh of power batteries in September 2025 (+39.5% y/y; +21.6% m/m), led by LFP at 62.2 GWh (81.8% share). January–September reached 493.9 GWh (+42.5%). Output hit 151.2 GWh; sales 146.5 GWh; exports 26.7 GWh in September and 199.9 GWh YTD.

https://lnkd.in/erPmHX79

©️ François Roudier, OICA, October 2025

**Ferrari lifts the hood on EV tech in maiden electric car** Reuters – October 9, 2025 

Ferrari previewed the Elettrica’s chassis/powertrain: 310 km/h, ≥530 km range, floor-integrated pack, engineered “electric Ferrari” sound; 75% recycled aluminum. First EV due 2026; second delayed to 2028. Fully electric share target cut to 20% by 2030.

lnkd.in/eX7CvyAu

**Germany’s car summit: purchase incentives for e-cars – struggle for position on the end of the combustion engine** Automobilwoche – October 10, 2025

Germany proposes €3bn buyer incentives and extending EV vehicle-tax breaks while pushing EU flexibility on the 2035 target (credits for PHEVs/range-extenders, small-EV “supercredits”). Verband der Automobilindustrie (VDA) e.V. says strict BEV-only path is unrealistic; Volkswagen Group’s Blume urges broader tax relief and investment credits. 

lnkd.in/e5mmpwtB

BYD marks 14 millionth NEV milestone with delivery to Brazil’s Head of State **CarNewsChina – October 10, 2025**

BYD 14,000,000th NEV—a Song Pro hybrid—rolled off in Camaçari and was presented to President Lula. BYD pledged COP30 fleet donations, highlighted Brazil leadership, and celebrated “BYD Road.” It added 4 million NEVs in <1 year amid rapid South American expansion. 

lnkd.in/eQyA9yRU

**Toyota’s Hino and Daimler Truck unit to consolidate Japan production** Nikkei – October 10, 2025

Toyota’s Hino Motors and Daimler Truck’s Mitsubishi Fuso will merge under Archion in April, consolidate plants (Nakatsu closing by 2028; Hamura to Toyota), and co-develop CASE tech. No layoffs planned. Post-deal, Japan’s truck market splits roughly 51% Isuzu-UD / 49% Hino-Fuso.

lnkd.in/eTRh5vmz

**Renault opens EV battery lab to identify tomorrow’s winning technologies** Automotive News Europe – October 9, 2025 

Renault Group www.linkedin.com/company/renaultgroup/’s €40m Lardy Battery Cell Innovation Lab will prototype/validate cells for Renault, Dacia, Alpine and scout startups for Ampere. Roadmap: LFP for affordability, NMC for density, cobalt-free mid-term, lithium-metal anodes ~2030; target BEV breakeven 2025 and 40% cost cuts by 2028.

lnkd.in/ebT2SjXt

©️ François Roudier, OICA, October 2025

**ACEA demands EU eases ‘rigid’ 2035 petrol car ban** Financial Times – October 8, 2025

European Automobile Manufacturers’ Association (ACEA) urges revising the 2035 ICE ban: allow carbon-neutral fuels, five-year averaging, credits (small BEVs, scrappage, production CO2 cuts), and softer penalties. Says BEV uptake lags assumptions; NGOs warn this weakens certainty. Political pushback grows, notably from Germany.

lnkd.in/eRaA3wy7

**Tesla, Hyundai, Nissan offer cheaper EVs as China price war goes global**Nikkei – October 9, 2025

EV discounts spread: Tesla cuts U.S. prices post tax-credit repeal; Hyundai trims up to 20% and targets cheaper models globally; Nissan lowers Leaf in Japan. CATL scale pressures costs. Analysts foresee further cuts, consolidation, and restructuring.

lnkd.in/eWuaWacp

**Stellantis: the first signs of recovery are on the horizon** Les Echos – October 9, 2025

Stellantis Q3 U.S. registrations +6%; Jeep +11%, RAM V8 relaunch strong. Incentives >$4,600 clear inventory; CO₂ rollback eases fines. Share price +~20% since Sept. 30. Still rebuilding lost U.S. share; Europe shows tentative uptick.

lnkd.in/e_kUbA6e

**China’s BYD expands South American footprint with Argentina EV launch** Reuters – October 8, 2025

BYD  starts Argentina sales, leveraging 2026 tariff waivers (up to 50,000 EV/HEV imports). Launches Yuan Pro EV, Song Pro PHEV, Dolphin Mini EV (<$16k ex-tax). Low local EV penetration and improved credit may unlock demand.

lnkd.in/exDDt6wt

**Solid state battery tech not a priority for North American manufacturers** Automotive News – October 8, 2025

Experts say mass solid adoption in North America is years away due to cost and manufacturing hurdles. GM standardizes on LFP/LMR/NMC; Ford continues R&D. China races ahead; semi-solid likely scales earlier. Silicon-enhanced graphite offers nearer-term gains.

lnkd.in/eunfMQjQ

©️ François Roudier, OICA, October 2025