Good morning! It’s Thursday, January 30, 2025, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Tesla’s Auto Business Falls in Q4 2024
Tesla CEO Elon Musk tried to distract from the fact his automaker posted a sales decline in 2024 by talking about self-driving cars and Optimus humanoid robots during a call earlier this week, but those sideshows don’t take away from the fact Tesla is going through something right now.
The Austin, Texas-based automaker posted declines in operating margin and automotive revenue for the year. Much of its growth came from strong demand for its energy-storage products and rising sales for regulatory credits. From the Wall Street Journal:
The billionaire entrepreneur opened the electric-car maker’s earnings call with a focus on its future businesses, including its rollout of unsupervised autonomous vehicles in Austin in June, and an internal goal to build 10,000 Optimus humanoid robots by the end of the year.
“We’re setting up for what I think will be an epic 2026 and a ridiculous ‘27 and ‘28—ridiculously good,” Musk said.
Man, that is so epic and ridiculous. I can’t wait for that to happen. Anyway...
Revenue was up 2% for the period, lifted by stronger demand for its energy-storage products and rising sales of regulatory credits. These credits, essentially pure profit for Tesla, are sold to other automakers that buy them to meet tailpipe-emissions requirements set by the U.S. government.
But for its core automotive business, revenue was down 8%, in part because Tesla leaned heavily on promotional deals in the fourth quarter to drive a rebound in sales in the last three months. Overall, Tesla’s closely watched operating margin was 6.2%, down from 8.2% a year earlier.
Tesla is facing an array of challenges in the year ahead, including a chief executive whose attention is divided by his other companies and work as an adviser to President Trump.
Its core auto business is under pressure with demand weakening for its vehicles, including its new Cybertruck pickup, and intensifying competition in China, where a price war in the electric-car market has broken out among foreign and homegrown automakers.
Musk’s close relationship with Trump only came up once on the call with Wall Street, when an analyst asked Musk what the right policy is to support sustainable transportation in the U.S. Musk largely avoided the question.
“At this point, I think that sustainable transport is inevitable,” he said.
With growth stalled, investors are hopeful that more affordable electric-car options promised by Musk will help revive consumer interest in the brand.
During the call, Tesla’s CFO, Vaibhav Taneja, reiterated that the automaker plans to release a handful of new products this year, including a new low-cost model sometime in the first half. At this point, there’s still no word on what that’ll be, but if I had to guess it’ll just be a de-contented Model 3.
In October, Tesla showed off prototypes for two fully autonomous vehicles—the Cybercab, a gold two-seater with butterfly wing doors, and the Robovan, a 20-seater, art-deco style bus. Musk said the Cybercab could be available to customers for less than $30,000 with production starting by 2026.
I can’t see into the future, but I’m willing to say Tesla’s 2025 will be even bigger, louder, stupider and more confusing than in 2024. Maybe it’ll even manage to sell a few cars along the way.
2nd Gear: Toyota Sold More Cars Than Anyone In 2024
Toyota says it sold 10.8 million vehicles in 2024, making it the world’s top-selling automaker for the fifth year in a row. This wild achievement comes despite the fact the Japanese company actually posted a 3.7 percent drop in global sales between Toyota, Lexus, Daihatsu and Hino.
The dip is being blamed in large part on a sales slump in Japan where the automaker faced fallout from governance issues over its certification test procedures, especially at Daihatsu. From Automotive News:
Toyota’s trademark hybrid models emerged at the sales heroes, helping to blunt the slide. Worldwide deliveries of full, mild and plug-in hybrids rose 23 percent to 4.39 million vehicles.
Gasoline-electric hybrids comprised 43 percent of Toyota’s parent-company global volume, up from 34 percent in 2023. Battery-electric vehicles, by contrast, still barely registered. Global BEV sales climbed 35 percent, but only amounted to 139,892 vehicles, or about 1.3 percent of Toyota’s worldwide volume.
[...]
The Lexus luxury brand booked an all-time sales record, with deliveries increasing 3.3 percent to 851,214 vehicles in 2024, led by a 6.7 percent gain North America. Lexus sales there reached 355,606 vehicles, accounting for 42 percent of global volume. China was the No. 2 Lexus market.
Toyota Motor group sales dipped below year’s record 11 million mark. But sales exceeded 10 million for the fourth-straight calendar year since 2020′s decline during the pandemic.
In 2023, group sales rose 7.2 percent to 11.23 million.
The tally was enough to keep its lead over Volkswagen Group, which reported a 2.3 percent sales decline to 9.03 million vehicles in 2024, on deteriorating sales in China.
Toyota’s U.S. sales rose 4.3 percent in 2024 to 2.73 million vehicles. It helped make up for the fact it dealt with a 6.9 percent dip in China to 1.78 million vehicles sold.
Toyota also faced some issues brought on by recalls, something Toyota isn’t all too familiar with.
In the U.S., Toyota’s business was undercut by recalls of several high-margin nameplates that hurt sales and production. First Toyota recalled the Tundra pickup and Lexus LX SUV in May for an engine problem. It decided in July to replace those engines in more than 100,000 vehicles.
In June, Toyota issued a stop sale on the Grand Highlander and Lexus TX three-row crossovers to address an airbag that may not deploy as intended.
That problem was expected to affect some 145,000 vehicles.
Still, congrats to Toyota on another monster year. For the time being, it sure looks like its decision not to push EVs is working out. With this newly minted Trump administration, Toyota may be in a good spot to go for the six-peat in 2025.
3rd Gear: Waymo Expanding To Over 10 New Cities
Alphabet’s self-driving car company Waymo says it’s going to expand testing of its autonomous vehicles to over 10 new cities in 2025. It says that after testing the Waymo Driver in multiple cities, the technology has been adapting successfully to new environments, so it’s time for an expansion. From Reuters:
In addition to ongoing trips to Truckee, Michigan’s Upper Peninsula, Upstate New York and Tokyo, the expansion includes testing in San Diego and Las Vegas, with more cities yet to be announced.
“During these trips, we’ll send a limited fleet of vehicles to each city, where trained human autonomous specialists will be behind the wheel at all times,” a spokeswoman for Waymo said.
The testing will begin with manual driving through the densest and most complex parts of each city, including city centers and freeways.
Waymo plans to send less than 10 vehicles to each city, where they will be manually driven around for a couple of months, according to The Verge, which first reported the news.
adding another city to its operations as it seeks to gain an edge in an increasingly competitive market.
The firm is under intense scrutiny from safety regulators following multiple incidents involving autonomous driving technology.
Waymo said in October that it had closed a $5.6 billion funding round led by Google-parent Alphabet, as it looks to expand its autonomous ride-hailing service.
I’ve yet to take a Waymo robotaxi, but I will admit, even though they’re a little goofy, it is some neat technology in play. That being said, I don’t love that it’s taking jobs away from drivers. I guess we’ll see how it goes.
4th Gear: ‘Challenging’ Market Means Nissan Is Cutting U.S. Jobs, Output
Nissan is slashing the output of both the Rogue and Altima by shrinking its hourly workforce by up to 13 percent at three U.S. factories in the Southeast. In April of this year, the Japanese automaker plans to scrap the second assembly line shift building the popular sedan and crossover in Smyrna, Tennessee and Canton, Mississippi. It’s also reducing output at an engine plant in Decherd, Tennesee, however, no shifts are being cut. From Automotive News:
AutoForecast Solutions estimates that moving the Rogue and Altima to a single shift — and factoring an increase in line speed of the remaining shift — will decrease production about 63,000 cars and trucks this year, or 12 percent of total U.S. vehicle output.
Nissan will offer buyouts to more than 1,500 employees, a source with knowledge of the plan told Automotive News, with the most generous packages going to those who have worked there longest. Company officials declined to say how many U.S. jobs they want to eliminate.
Nissan North America’s head of manufacturing and supply chain management, David Johnson, described the pullback as a “momentary reaction” to reduced customer demand. He wouldn’t disclose the planned reduction in U.S. output.
[...]
The U.S. retrenchment is part of a global restructuring as Nissan attempts to reverse a steep decline in sales and profitability. In November, the Japanese automaker said it would slash 9,000 jobs and cut factory output by 20 percent.
The Rogue and Altima combined for 42 percent of Nissan’s 865,938 U.S. deliveries in 2024. Still, Rogue and Altima sales fell 9.5 percent and 11 percent, respectively.
Nissan did note that if not all of the 1,500 employees it offers buyouts to take them up on the offer, it does not play to carry out any involuntary layoffs. That’s good, at least.