KEIGH NAUGHTON and BLOOMBERG 2-5-2025

Ford appears to be lagging in the electric vehicle market, having not introduced a new EV model in over two years. Like many other automakers, Ford has abandoned some of its EV goals, such as producing 2 million EVs by 2026, despite investing billions in developing new models. The EV market continues to face challenges, such as consumer range anxiety, concerns over inconsistent charging infrastructure, and, most significantly for Ford, rising EV prices. Bill Ford, the company’s executive chair, commented, “We are working very hard on EV affordability, because I think that will be the catalyst for much wider adoption.” Meanwhile, General Motors surpassed Ford in EV sales in the second half of 2024, and Tesla’s Cybertruck has now outsold Ford’s F-150 Lightning. Ford is expected to reveal its updated EV strategy for 2025 soon, including plans to generate a return on the billions invested in its electric vehicle initiatives.

Why Mercedes-Benz’s driver assistance system ranks higher than Tesla’s

ROBERT FERRIS 2-4-2025

Tesla’s Autopilot system, once a leader in advanced driver assistance, now ranks eighth per Consumer Reports, trailing behind Ford, GM, Mercedes-Benz, BMW, Nissan, Toyota, and Volkswagen. The system uses names like “Autopilot” and “Full Self-Driving,” but the features are not quite as advanced as some may believe, says Kelly Funkhouser of Consumer Reports. Advanced driver assistance systems automate tasks to aid driving but differ from true self-driving cars. Features include “automatic emergency braking” and “lane centering.” Each system has its pros and cons; the best in one aspect may not excel universally. Mercedes-Benz’s EQE 350 SUV system excels in many areas but lacks a driver monitoring camera, unlike Ford’s BlueCruise and GM’s Super Cruise. Adding this feature could boost it to the top rank.

Waabi and Volvo team up to build self-driving trucks at scale

REBECCA BELLAN 2-4-2025

Volvo has partnered with self-driving truck startup Waabi to develop new autonomous commercial trucks. This collaboration will complement Volvo’s existing joint venture with Aurora Innovation, which was announced last spring to launch the Volvo VNL Autonomous truck. Waabi’s technology, including its sensor suite and Waabi Driver software, will be integrated into the same truck model. The first autonomous trucks are set to be produced at Volvo’s Virginia facility later this year, with testing scheduled to begin in Texas. A public road demonstration is planned for the end of the year. “2025 is the year of trucking; it’s a make it or break it situation,” said Raquel Urtasun, founder and CEO of Waabi. “Trucking is only the beginning.”

Honda’s new EV production revolution begins with $1 billion investment in Ohio

MICHAEL WAYLAND 2-3-2025

Honda Motor is investing over $1 billion in Ohio to enhance its manufacturing for electric vehicles (EVs). This includes installing six large “giga presses” and a new manufacturing system for electric vehicle battery cases. Ohio will be the main hub for Honda’s global vehicle production, capable of making traditional cars, hybrids, and EVs in the same plant.

Honda aims to produce 220,000 vehicles annually at its Marysville plant, which will debut an all-electric Acura RSX crossover. The company plans to introduce several EV prototypes and has set environmental goals, including zero emissions by 2050 and exclusively selling zero-emission vehicles by 2040. “The Honda EV hub in Ohio is establishing the global standard for EV production for people, for technology and for processes,” said Mike Fischer, North American lead for Honda’s battery-electric vehicle projects. “As we expand EV production regionally and globally, this is the footprint and the characteristic performance that will be used.”

Tesla’s new cars suffer massive failures in autonomous driving

ALBERTO NORIEGA 1-30-2025

Tesla’s latest vehicles with the HW4/AI4.1 self-driving computers are facing failures in critical functions like cameras, GPS, and active safety, often within the first few hundred miles. Rooted in potential short circuits during the camera calibration process involving the low-voltage battery, these issues compromise vehicle safety and reliability. A software patch is seen as a temporary fix, but experts suggest replacing the faulty computers for a permanent solution, which could lead to long wait times for owners. This has overwhelmed service centers, delayed service appointments, and led to unsatisfactory responses from dealers, raising customer frustration. The failures pose a challenge to Tesla’s reputation, especially as autonomous driving is crucial to its strategy. Without a swift resolution, Tesla may face regulatory pressures and a weakened market standing.

Here’s what effective federal rules around autonomous driving vehicles could look like, according to a former DOT inspector general

LLOYD LEE 2-3-2025

The US has many state laws that autonomous vehicle (AV) companies must follow, and the federal government is not keeping up with regulations. Former DOT inspector general Eric Soskin suggested the government could develop federal guidelines to help. Companies like Waymo and Tesla face different state rules, complicating efforts to adopt AV technology. Soskin emphasized the need for performance-based standards, data sharing for cybersecurity, safety features for failures, and a fair liability system to support the growth of autonomous vehicles. The Autonomous Vehicle Industry Association has proposed a federal policy framework to accelerate AV development.

Two years running, U.S. Secretary of Transportation Pete Buttigieg has spoken at SXSW on the future of transportation, and two years running he has focused on equity. In 2021, in a keynote titled “Pete Buttigieg on Equitable and Empathetic Transportation,” the Secretary touched on historic inequities in infrastructure development (e.g., the building of highways through “the path of least resistance” in black and brown neighborhoods) and the need to address so-called “transit deserts” to literally connect more people with opportunity. He revisited these themes in his 2022 remarks, naming equity as one of five core issues on which the DOT is focused (along with safety, economic development, climate, and transformation), and emphasizing “[i]t is so, so important, with this much money going into our transportation system, that we deploy it in ways that are going to benefit everybody.”

At first blush, transportation may not seem like a topic that would implicate equity. But especially as technology increasingly promises to transform transportation as we know it, increasing attention has been paid to equitable innovation and policymaking in the sector. Today we highlight a few ways in which equity has entered the discussions around electrification and automation specifically.

Electrification. The news that several states including California and New York will ban sales of new gas-powered vehicles as of 2035 was greeted by many as a positive step toward carbon neutrality and environmental justice. In some respects, then, these laws can be viewed as an equity “win.” Yet stakeholders and policymakers alike have raised concerns that the laws may ignore the average American consumer and small businesses—i.e., with most EVs still being marketed in the “luxury” class, if the laws went into effect today, many Americans would be unable to comply and would be locked into driving older, inefficient ICE vehicles. As noted in a recent Fortune article, “[a]ccording to the U.S. Census, median household income was $70,784 in 2021, the most recent year for which data is available. The average price for an electric vehicle in July of 2022, was over $66,000, according to Kelley Blue Book (KBB).” It is not surprising, then, that a 2019 study found significant disparities in EV purchases between high and lower-income populations: “counting both new and used vehicle purchases, households earning less than $100,000 per year represent 72% of gasoline vehicle purchases, but only 44% of electric vehicle purchases. Black and Latino car buyers make 41% of gasoline vehicle purchases, but only 12% of EV purchases.”

The country’s inadequate charging infrastructure also disproportionately disadvantages lower income communities who do not have easy access to charging stations or in-home chargers. Fortune also reports that “83% of vehicle owners who make under $50,000 per year don’t have dedicated access to EV charging at home,” and describes apartment-dwelling EV owners stretching extension cords for lengths just to access a power supply.

For these reasons, groups like the California Hispanic Chambers of Commerce have been outspoken critics of laws mandating EV sales, saying “small businesses and their employees cannot absorb these economic losses. …  The regulations are simply too much, too fast, for minority-owned businesses.”

Automation. Automated and autonomous vehicle technologies have the potential to dramatically expand transportation access to historically underserved communities, advancing Secretary Buttigieg’s goal of connecting more people to opportunity. For example, as outlined in this study, AVs could be used to “reduce the increased risk of mortality associated with isolation for seniors,” or provide solutions for those “transit deserts” that public transportation does not reach. AVs are being explored as a way to provide transportation to disabled populations, including by industry leaders like Waymo, which has launched the “Waymo Accessibility Network” with the goal of “ensuring [its] transformational rollout of autonomous technology is inclusive and equitable.” AVs also may reduce traffic deaths and air pollution, issues that disproportionately impact lower income communities (see here and here).

But as with EVs, concerns abound that the populations that may benefit most from the technology will be largely ignored in deployment and policymaking. The Urban Institute, for example, has warned that thoughtful policy is just as important as it relates to automation: “we … believe that today’s regulatory environment is so underdeveloped that uncertainty may be slowing progress. And failing to intervene now—when AV deployment remains nascent—could reinforce the negative outcomes of today’s automobile system.”

***

We have just scratched the surface here, and certainly do not claim to have all the answers. But it should be obvious just from the highlights that innovation to reduce the cost of entry, and thoughtful policymaking to encourage equitable deployment and infrastructure development, are imperative to realize the full potential of these technologies for everyone.

Copyright Nelson Niehaus LLC

The opinions expressed in this blog are those of the author(s) and do not necessarily reflect the views of the Firm, its clients, or any of its or their respective affiliates. This blog post is for general information purposes and is not intended to be and should not be taken as legal advice.