Episode #226 - Halloween Horror for EU Legacy Auto: BYD’s Profit Drop, Porsche’s Collapse, and China’s EV Power Shift

This week on China EVs & More, Tu and Lei unpack a scary set of Q3 results for global automakers. Porsche’s operating profit nearly vanishes, Mercedes-Benz and Volkswagen Group struggle, and BYD reports its first major profit decline in years. Meanwhile, Li Auto faces a costly Mega recall after a battery-coolant fire, raising new questions about safety and supply-chain quality.

Tu shares insights from the Reuters Automotive Summit, including what executives from Rivian, Lucid, and Mercedes-Benz USA had to say about current challenging environment — plus takeaways from Ganesh Iyer of NIO USA. 

The hosts also discuss how Chinese tech players like Xiaomi and Geely are resetting global expectations, why CATL’s battery dominance will continue for the next decade, and what the West must learn from China’s hyper-competitive EV market.

Chapters
02:16 Halloween Reflections and Market Concerns
05:04 Li Auto's Recall and Safety Issues
08:00 Financial Performance of Major Automakers
11:03 Competitive Landscape in the EV Market
13:49 Restructuring of German Automakers
16:46 Insights from the Reuters Conference
19:59 Level 4 Autonomy and Future Trends
30:03 The Evolution of Autonomy
34:50 Mapping the Future of Autonomous Vehicles
39:51 Marketing Strategies in a Multicultural Landscape
44:31 Consumer Data Privacy and Trust
54:08 The Future of Battery Technology

_____

Stay tuned for sharp analysis on involution, layoffs at GM, brand marketing shifts, and how the next generation of EVs from Mercedes, Hyundai, and NIO will shape 2026.

Companies & Topics Discussed:

BYD | Li Auto | CATL | Porsche | Mercedes-Benz | Volkswagen Group | Audi | BMW Group | Beijing Hyundai | NIO | Xiaomi | Geely | Luxeed | DJI | Momenta | FinDreams | Rivian | Lucid | Stellantis | Uber | Nvidia | GM | Honda | Apple | AESC | Gotion | Calb

Transcript

Tu Le (00:00)
 Hi everyone, and welcome to the China EVs and More podcast, where my co-host, Lei Xing, and I will go over the week's most important and interesting news coming out of the global EV, AV, and mobility sectors.
 
 happy Halloween everyone as well. What Lei and I discuss today is based on our opinions and should not be taken as investment advice. For those that are new to the show, welcome. And to our loyal listeners and viewers, welcome back.
 
 Don't forget to subscribe and like and help us get the word out about this podcast to other enthusiasts. And of course, tune in again next week. My name is Tu Le I am the managing director at Sino Auto Insights, a global management consultancy that helps organizations bring innovative and tech focused products and services to the transportation and mobility sectors. I write a free weekly newsletter that we pull many of our discussion topics from. You can sign up for it at sinoautoinsights.substack.com.
 
 which of course I encourage you all to do. Lei a scary Halloween Lei whose mic didn't work very well for a second there, can you please introduce yourself?
 
 Lei Xing (01:10)
 Well, I hope it's working now. think it's working now. Good morning. Good morning. ‚Åì This is Lei Xing, former chief editor of China Auto Review. And yes, this is episode number 226. So it's Halloween. ‚Åì And Here are some scary things on my mind. First of all,
 
 Tu Le (01:13)
 It's working now.
 
 You
 
 Lei Xing (01:37)
 The clock goes back one hour on Sunday, which means we're going to have to deal with a long winter when night falls before 5 p.m. Second of all.
 
 Two months left in 2025. Hard to believe. Very scary how fast this year went by, right? And third of all, the horrendous numbers that we saw financially over the last few days, including BYD. I know that's been a topic that's been on the, yeah.
 
 Tu Le (02:01)
 Yeah.
 
 Yeah, BYD is not excluded from that. That scary...
 
 Lei Xing (02:23)
 Porsche 99 % drop in operating return on sales basically to nilch for Q3. Mercedes Volkswagen group as a result of the Porsche they had their negative quarter profit since the pandemic since I think 2020 when everything was down.
 
 So those are the scary things on on tap for today in the spirit of Halloween
 
 Tu Le (03:02)
 And we are one day away from sales numbers being posted by the Chinese automakers, likely with the exception of Li Auto and a couple of other players.
 
 Lei Xing (03:12)
 Well, the other scary thing since you mentioned Li Auto is the weekly numbers are history. I know they're still being reported, but Li Auto no longer reports them. And obviously their numbers does not look good as before. And they just announced this recall of the Mega
 
 Which is actually in hindsight a relatively bold move because nothing has been concluded from the ‚Åì official investigation. It's just based on their own findings of that fire, what, 10 days ago, that ‚Åì was quite ‚Åì talked about in the industry.
 
 Lei Xing (04:08)
 Safety.
 
 So.
 
 Tu Le (04:13)
 So...
 
 The Li Auto Mega
 
 catastrophe because it wasn't a tragedy people did not die I watched it a few times Lei and they're very very lucky that Inside the vehicle. There's a lot of people that are or there's someone that was quick thinking
 
 Lei Xing (04:35)
 Luckily, I think there were only two passengers, one in the backseat and one driver. That's what was purported to show, or based on the owner who released that statement, a legal statement of what happened.
 
 Tu Le (04:55)
 And we have to remember that these battery cells get assembled into modules, and then these modules get assembled into a battery pack. And that's what you get the skateboard. And whenever there's additional layers, so there's the cell layer, there's the module layer, and then there's the pack. And they're supposed to be flame.
 
 retardant materials that are trying to make sure that no explosions happen or if there is flames or there are flames then they are contained. that's where and I'm not a technical expert on battery packs but it seemed like it happened really really fast. ‚Åì
 
 Lei Xing (05:50)
 So
 
 in the recall that Li Auto sent out, ‚Åì the culprit was the coolant that runs through the battery pack. The coolant and the recalling, ‚Åì even the replacing by the way, the battery pack, the whole thing. That's their measure. Okay, that's big money. And then second, there's something called the aluminum coolant cooling plate.
 
 Tu Le (05:58)
 Hmm.
 
 Lei Xing (06:19)
 for the motor controller that they will also replace. ‚Åì
 
 Tu Le (06:27)
 So looks like that plate didn't do its job maybe.
 
 Lei Xing (06:30)
 something wrong with the cooling I don't know but at this point it doesn't appear to be the ‚Åì issue with with cell which means CATL if I was CATL you know CATL hasn't made any public statement about this because it is a CATL Qilin battery from the cell but Li Auto worked with CATL for the pack
 
 So I mean, currently it looks like it's not CATL's fault or the cell fault, just the mechanical, ‚Åì how the battery pack cooling. But one source of information that Li Auto released or said was that they did ‚Åì see an issue ‚Åì beforehand, like a few hours beforehand, but nothing was.
 
 done. So that's something that they need to work better later. ‚Åì But what if there were other passengers, especially in the third row? ‚Åì
 
 Tu Le (07:47)
 there
 
 were children because Mega you would think that there would be children potentially in that thing so
 
 Lei Xing (07:54)
 Yeah, yeah.
 
 But as of this point, I just created that, first of all, this is actually a big PR win for Li Auto because they wanted to be ahead and try to be transparent on what happened, what their findings were, what their action was. So from a crisis PR point of view, they did a good job. But I think there's still question marks on the safety.
 
 Even though the auto says all of their vehicles are more ‚Åì in terms of the national battery safety standard that they're way ahead or way above the standard, but this still happens.
 
 Tu Le (08:39)
 So sometimes
 
 what happens lay internally is that these car companies will get the vehicle and then do the analysis to post-mortem and find out that it could be a single component, single part. In the case of electric vehicles, there could be a battery management software system issue. Or it could be a one-off.
 
 Tier 1s normally do is they build parts in batches, like lots. And so lot number 1 can have 1,000 parts. And then lot number 2 can have another 1,000 parts. And that's how you kind of manage some of the quality. And you're able to really pinpoint it. And then, OK, this was part number 5 on lot 1. So we're going to check all of parts in lot 1 to make sure that they don't have that flaw.
 
 I think that's how they start sometimes. if we think about, we're talking about Li Auto but if we think about CATL.
 
 They're lucky too that it's not a CATL problem because CATL batteries are everywhere in China.
 
 Lei Xing (09:55)
 That's
 
 exactly the point, how this could escalate into a more serious problem.
 
 Tu Le (10:04)
 And you talk about Li Auto getting in front of it. This is going to be a big check for them potentially to write. We're talking like more than NIO replacing or Geely replacing the AI chip or the Orin chip in the 001s. Remember that.
 
 Lei Xing (10:25)
 Yeah,
 
 the numbers, it can be easily crunched. 11,411 units being recalled. That's about half of what they sold, the megs. Multiply by 50,000 MMB, ‚Åì conservatively, 50,000 RMB a battery pack. That's half a billion dollars worth of energy. Yeah. Yeah. So ‚Åì yeah. But.
 
 Tu Le (10:44)
 Which is about $8,000. Which is about $8,000.
 
 They're lucky that the in this instance, they're lucky that the Mega didn't sound like crazy.
 
 Lei Xing (10:57)
 And as of this moment Xiaomi hasn't done anything on their accident ‚Åì like a month before. Nothing has happened.
 
 Tu Le (11:10)
 Well, didn't they recall,
 
 didn't they do an over-the-air update?
 
 Lei Xing (11:13)
 That
 
 recall was on the previous accident that happened in March. ‚Åì So it also, think this incident also shows different tactics of ‚Åì the players, what they're willing to do to get their reputation.
 
 Tu Le (11:17)
 Mmm.
 
 Lei Xing (11:37)
 Li Auto has always been fast, right? So especially currently they're in facing extreme headwinds on their e-rads.
 
 Tu Le (11:49)
 I also
 
 wonder if that has anything to do with Li Auto being in Beijing.
 
 Lei Xing (11:55)
 Well, mean, there's Li Auto there's Xiaomi, there's Beijing Hyundai, there's Beijing Benz. I mean, every one of those companies are facing different scrutiny, right? Or ‚Åì a situation in what they are, ‚Åì But yeah, that's part of the juan, right? Part of the juan. ‚Åì
 
 Tu Le (12:23)
 So let's talk a little bit about these numbers ‚Åì with Mercedes and Porsche and Volkswagen Group. Can you summarize what you saw? I've been, and we'll spend a little bit of time talking about the Reuters Conference I was just at. So I have not been working, working. I've been working, working.
 
 Lei Xing (12:25)
 No.
 
 Sure, sure, we'll talk about that.
 
 Different type of work. ‚Åì No, mean, what can you say? I think Q3 was just a combination of every one of these Audi, Mercedes, ‚Åì Porsche, Volkswagen group. There's this common thread among them. It's the intense competitive.
 
 Tu Le (12:54)
 if you know what I mean. Yeah, so.
 
 Lei Xing (13:20)
 pressure they face in China. There's mention of that in all of their announcements, but it's only half the problem, I think. China's obviously the one place where they're getting killed, but there's other issues, When you talk about Europe, you talk about these suppliers needing to lay off, I don't know how many people, 20, 30,000 people. Mercedes is doing that.
 
 right, to get their costs down. All of these tariffs, tariffs luckily, right, we heard about Xi and Trump meeting, we saw that there's some movements on the tariffs. ‚Åì
 
 Tu Le (14:03)
 Well, in the immediate
 
 term, Lei, we're talking about chips from Nexperia shutting down factories.
 
 Lei Xing (14:09)
 Yeah, I mean we exactly we
 
 talked about that last episode ‚Åì So all of these headwinds are are just ‚Åì
 
 You know, it's Halloween, it's scary to put it mildly.
 
 Tu Le (14:26)
 Well,
 
 we talk about this roundabout a lot maybe, but if you took a picture today, Lei, of Audi, Bimmer Mercedes, Porsche, Volkswagen Group in China, knowing what we know about their future planning, their future technology roadmap in China, who do you think?
 
 the best chance to flatten out and maybe even grow a little bit over the next three, 4, five years. You think so? Okay.
 
 Lei Xing (15:01)
 I'd say all the German one. I'd say all the German one. Yeah, mean, after
 
 rank Volkswagen Group is the most active and then Mercedes, BMW Group, ‚Åì know, Volkswagen Group obviously includes Audi. Porsche is realigning their sales network. They actually, what they did in China, I'm sure you know about this. Porsche recently opened a Chaoyang Porsche Center, which combined their first
 
 Tu Le (15:29)
 Mm.
 
 Lei Xing (15:32)
 Porsche Center in China, that was on Changan Street. That was first ever one in China, with another one in Goldenport.
 
 Tu Le (15:42)
 All right. So let me explain to the folks.
 
 Lei Xing (15:43)
 Right. that's part of their
 
 realignment of the channel. ‚Åì We don't have to even talk about products because they're selling, they're going to sell less than 40,000 in China this year.
 
 Tu Le (15:56)
 So
 
 for the folks that are wondering Changan Jie is where Tiananmen Square and Forbidden City is on, it is basically where it's like Washington DC and the White House kind of thing, right? And then ‚Åì Golden Port is a racetrack in the suburbs of Beijing. Yeah, in the suburbs of Beijing, probably an hour and a half outside of city center where Changan Jie is.
 
 Lei Xing (16:17)
 Near the airport.
 
 Tu Le (16:26)
 So yeah, I agree. We can talk a little bit about the Reuters Conference because I did talk about Porsche and I did say that they were at 95,000 units in 2023, I believe, or 22. And so now they're under 40. So.
 
 Lei Xing (16:48)
 Yeah, it was up there. It was up there.
 
 in three years basically.
 
 Tu Le (16:56)
 So what you're saying is that they're restructuring because they don't have the demand that they used to. So the dealerships, the service centers, they don't need as many. And that also tells you that when you restructure, you're trying to take capacity out of the system because capacity that's underutilized or not utilized at all is just overhead costs that weighs you down.
 
 So when you restructure, also signal to the market that we don't see in the near term, the next five, six, seven years, 4, five, six years, we don't see us getting back to 95,000 units. So I think that's also really, really important to articulate and point out.
 
 Lei Xing (17:45)
 Yeah, yeah. mean all of their Mercedes launching the CLA next week, the locally built CLA. ‚Åì You know, Beijing Honda.
 
 Tu Le (17:56)
 That is such
 
 a linchpin product for Mercedes in China.
 
 Lei Xing (18:00)
 Yeah, yeah,
 
 because similar Beijing Hyundai launched that yield their first ever battery electric SUV. And guess who the partners are right? CATL, DJI, Momentum, ‚Åì FinDreams. Okay. ‚Åì And their strategy, tactics, they're in place, the rest is up to the market, the rest is up to the execution.
 
 Tu Le (18:07)
 Right.
 
 ‚Åì right.
 
 Lei Xing (18:28)
 They have these products they think are right for the market that are coming. And we have to find out ‚Åì next year, because this year is pretty much done, really. And then, yeah.
 
 Tu Le (18:44)
 The
 
 4 legacies to your point in 2026, some of them are gonna be launching very important vehicles for their brands and a slowdown in the price war and kind of moving past this involution should be very helpful for them and to them. We talk about, so I saw Ganesh.
 
 He was at the conference, so he says hello. anyways, ‚Åì like, know, companies like NIO who are kind of finding their footing in the China market, I think it's important for them as well to kind of get some of these players that are nipping at their heels out of the system, out of the market.
 
 Lei Xing (19:16)
 Yeah.
 
 I
 
 mean, we, these, everything we take a kind of a relative lens at what's happening. So BYD profit down 33%. They still earned, I think it was seven, like over $1 billion in profit. That's still pretty good, but relative terms, it was down compared to last year. Their revenues were down. And if you remember last year, I think 2024, was the year when
 
 BYD had more revenues than Tesla.
 
 And also there were an improvement in margins, gross margins in Q3, I think. But on the flip side, we have the Chinese market always in these 12, 18, 24 month cycles, which means at this point in time, it's probably the NIOs the XPengs the that are
 
 running away, it almost seems. And whereas the bigger ones, the ones that were running away, BYD, Li Auto, some of these other ones are in a funk. And then by the time next year, by this time next year, who knows, it could be someone else. I think that's currently what we're seeing, that...
 
 If you're on top, be careful. mean, Geely, for example, launched the Xingyao 6. 70,000 renminbi, $10,000. EV, EREV, and BEV, That's hitting BYD's market segment, the chin, right?
 
 Tu Le (21:37)
 sub 20,000 US dollar in China is so intense, so intense.
 
 Lei Xing (21:42)
 Yeah, and then on the other
 
 extreme, large SUVs, right? Lee Motor launched the D19, the more coming. ‚Åì In fact, this guy who went over from BYD, Zhao Changjiang, he was the Denza guy. He moved over to Luxeed. Apparently, because Luxeed is launching a D9 competitor.
 
 Tu Le (21:58)
 Hmm.
 
 Lei Xing (22:06)
 And this Zhao Changjiang, he's a lifer at BYD. and he was kind of the guy who launched the Denza, the brand, the D9 and other models. So there's these part of the ‚Åì competition of talent even. So.
 
 Tu Le (22:28)
 To me Denza
 
 is a little bit like NIO because I believe in their products. like NIO's products. like Denza's products. look great. And interior, exterior and a little bit perplexed that they're not able to grab more share in the like not ultra premium, but the above. It's premium-ish. Premium-ish, I guess.
 
 Lei Xing (22:52)
 Well, yeah, when you
 
 have like a NIO ES8 which they say is better than an MPV, right? That's one competitor that's, they've already done 10,000 units in 40 days and likely they can get to probably 10K a month run rate by the end of the year. It's just one competitor that you would never thought of a month, two months ago.
 
 Tu Le (23:19)
 Right. ‚Åì yeah, BYD is not that surprising. The numbers still stand out, but competition is really also an easier way to say it. BYD is also not immune to competition. yeah, well, I see Xiaomi doing pretty well consistently.
 
 Lei Xing (23:38)
 Nobody is.
 
 Tu Le (23:46)
 So I think they stand out because they only have two products. So, and they're both new-ish in the market and ‚Åì they have a ton of value. They're priced so aggressively, you know?
 
 Lei Xing (23:59)
 Yes,
 
 Xiaomi, I think for the in the lens of maybe the 4 competitors, I think they still have a huge question mark on Xiaomi, meaning, okay, they have the engineering, they have the technology, but long term, I think they still question the long term kind of the durability and quality of Xiaomi's.
 
 Tu Le (24:23)
 Sure, and I think some
 
 people are anticipating Xiaomi entering the 4 markets. They said, what, 27? But ‚Åì it isn't, but man, think barring a backlash on how the two cars look like other cars.
 
 Lei Xing (24:36)
 2027, yes. Not that far away, you which is...
 
 Tu Le (24:52)
 I think the Europeans would eat those the YU7 and the SU7 up.
 
 Lei Xing (24:58)
 Yeah, and then Xiaomi is coming out with this Land Rover-ish, Range Rover-ish YU9 right?
 
 Tu Le (25:08)
 Yeah, so let me talk a little bit about the Reuters conference. It's the second year that I've spoken at it in this year. I was talking with Joe. I wasn't a huge fan of the title. It was like USA versus China, and I really wanted to emphasize and it was a more interactive. We were in a pretty big conference room, about 70-80 people and. Yes.
 
 Lei Xing (25:31)
 as Xi faced Trump so good that's
 
 a good title
 
 Tu Le (25:36)
 And
 
 so, ‚Åì so yeah, I didn't want to focus on.
 
 all this stuff, you know, asking whether or not we should take China seriously. I wanted to focus more on us, Joe and I to focus more on what are the companies doing? What are the brands they're hearing about? Who do they think? When do they think the Chinese went to the market? So it was a really good conversation. ‚Åì Pretty, pretty open. A lot of open minded people. And surprisingly,
 
 You know a lot so we had those uh, those it those polls that you could see right away and uh, BYD was the big winner on Which brand do hear about a lot? Xiaomi was also a big winner NIO was there and then Ganesh was sitting in the back so I could refer to Ganesh You know in person saying hey, you know, we have a distinguished guest Here Ganesh Iyer who is the
 
 the CEO of NIO USA. And then I also brought up the fact that you and I had done these long, long trips over the last couple of years in an XPeng and also a NIO. So it is, it's starting to set in and, there's this still a little bit of, there was a panel discussion on automatic toll payment.
 
 with MasterCard and is that a thing? A lot of cars can already do that. I don't know why there needed to be a panel discussion on it, but MasterCard was sponsoring the panel, guess. And so maybe it made sense for them. But Ganesh was because ‚Åì what kicked off the conference was Rivian CFO, who said that they are still anticipating R2.
 
 Lei Xing (27:26)
 Okay.
 
 Tu Le (27:42)
 to launch in the second half of 2026 and then Lucid interim CEO, Mark Winterhoff. ‚Åì Nick was there. He says, hello. so they had recently, yeah. Okay, yeah. So they, yeah. So Mark was really leaning into the level 4 and the announcements that were being made. And so I think if you want to.
 
 Lei Xing (27:56)
 We'll talk about Lucid, Uber, Apple, yeah.
 
 Tu Le (28:09)
 roll into the Lucid Conference. So like, who else was there? Ralph Gilles ended the conference. And ‚Åì man, that guy, he's so, huh?
 
 Lei Xing (28:20)
 We taught him, right?
 
 Three years ago at LA Auto Show, right? We had drinks.
 
 Tu Le (28:24)
 Yeah,
 
 I saw him a couple months ago at that conference. And so I got an ussie And when you listen to him talk, number one, he comes off really sincere. Number two, he's able to explain kind of difficult things or complicated things very easily. So it's no wonder that he's a leader at one of these big companies. I think 34 years, I think he's had more than
 
 Lei Xing (28:47)
 long time he's been there ‚Åì
 
 Tu Le (28:53)
 11 CEOs or something. But anyways, what did you want to talk about? Lucid, you want to kind of talk to everybody about that?
 
 Lei Xing (29:01)
 No,
 
 I think L4 this past week is one of the, if not the biggest keywords in the industry because of Nvidia, because of Uber, because of Stellantis, because of Lucid, Nuro, Motional right? And that picture with Jensen, the PowerPoint, he stood in front of, right? Listed all those names.
 
 Tu Le (29:20)
 Motionlal back in the game.
 
 Lei Xing (29:31)
 Pony, We Ride, ‚Åì Wayve. ‚Åì And then XPeng next week in their AI day is going to announce their updated plans on their own level 4 robot taxi based on the G9. So I think it's going to be an exciting upcoming ‚Åì months and years where we have two things going on.
 
 the so-called level 4 consumer vehicle and the level 4 robot taxi and how NVIDIA is playing a role in both, how these OEMs are playing a role, how these mobility platforms are playing a role. ‚Åì XPeng, they're not going to run the robot taxis. They're going to produce a dedicated level 4 robot taxi.
 
 So, you know, because in China we talk about, we haven't mentioned Tesla, right? Tesla is doing their own kind of thing. ‚Åì In China, the level two plus plus is already quite mature where the rest of the world, right? They also mentioned, ‚Åì I think Lucid was talking about this mind off in their mid size. So the smaller,
 
 Tu Le (30:34)
 Tensor, tensor.
 
 Lei Xing (30:59)
 Gravity, you will, upcoming in, don't know, 27 or 28. Yeah. And so this two fronts, I think it's quite exciting, and especially Uber is really betting. They're working with every player possible, whether it's OEMs, whether it's the Nvidia, ‚Åì the rest of the world, working with the Chinese robotaxi startups.
 
 Tu Le (31:03)
 They said late 26.
 
 Lei Xing (31:31)
 So I think that's the exciting thing for me. It seems that all of a sudden this is ‚Åì L4. ‚Åì
 
 Tu Le (31:38)
 It does seem like that, doesn't it? I
 
 said it feels like autonomy 2.0, where seven years ago, everybody said it's right around the corner. now people, technology companies are making bets. It's not just car companies. so, in between that seven years, you and I have taken dozens of rides, right? In China, United States. And so,
 
 Lei Xing (31:52)
 We're there again.
 
 Tu Le (32:09)
 Whereas seven years ago, five, six, seven years ago, you and I would have been pretty awestruck or pretty amazed by these partnership announcements. It just seems like because of AI, because of compute, because of the affordability of lidar and sensors, we're just getting to a more realistic view of autonomy in the future. GM, one of the most conservative automotive companies that I know of.
 
 They announced on tech day 2028, we're going to have an escalate IQ with level three. So we remember Honda was the first in Japan during traffic jams and then Mercedes in Europe and the United States, but very limited. Okay. And very slow speed. So it, it feels tangible. It feels real. It feels like the car companies actually have.
 
 done their homework this time and feel like they have the technical horsepower in-house to make these things happen. And then in the case of Uber, so let me also clarify, because I tweeted that for our friend ‚Åì Ed, the Lucid plus NVIDIA deal is for the baby gravity and it's for private passenger vehicles. So Lucid's using NVIDIA stack to do
 
 level 2++ and level 3. The Nuro yes. And in Nuro's case, Uber is purchasing Lucid Gravitys that have Nuro's hardware software stack on it. So this is the case where Uber is now becoming an owner, a fleet owner.
 
 Lei Xing (33:41)
 That's based on the Amidia Thor, AGF Thor. ‚Åì
 
 Tu Le (34:05)
 and manager. Now they'll probably outsource the management part, but the balance sheet is going to look completely different in five years. So.
 
 Lei Xing (34:12)
 Yeah, and
 
 then there's the ‚Åì NVIDIA Stellantis Foxconn, which NVIDIA is providing their whole stack based on the Hyperion platform. So quite a few things going on at the same time.
 
 Tu Le (34:27)
 And
 
 we just talked about it a couple of weeks ago, the Lyft TensorAuto VINFAST partnership.
 
 Lei Xing (34:35)
 Yeah, TensorFlow Auto, Auto X.
 
 ‚Åì
 
 Tu Le (34:40)
 So I'm
 
 actually going to be in San Jose. I should try to figure out if I know anybody at Tensor Auto and maybe make a visit. So ‚Åì it's just a really interesting time, because then you have a Wayve which is British. And then you have some, yeah, Zoox. And next week, I'm in Florida.
 
 for an FAV summit, an autonomous vehicle summit. And I met the gentleman, he was a Senator in Florida and he created this advocacy group.
 
 Lei Xing (35:18)
 ‚Åì
 
 In
 
 Florida, there's the in Orlando and surrounding area. I forget the company that runs these robot buses.
 
 Tu Le (35:30)
 is it... It's a European company, I want to say.
 
 Lei Xing (35:35)
 I forget the name. ‚Åì
 
 Tu Le (35:38)
 I do too, but I know who you're talking about. ‚Åì
 
 So what else? Yeah.
 
 Lei Xing (35:45)
 So I mean, I'll
 
 probably add a user.autonomy2.0. I could even say autonomyhype2.0, who knows? But maybe it's not hype.
 
 Tu Le (35:52)
 Well, yeah.
 
 Because to your point, in China, and I'd done that slide where I had electrification, ‚Åì smartification, automation. had US and Europe flags still on electrification. And then I had the China flag at automation because of all the level 2 plus that's going to be.
 
 and 2026 vehicles and beyond. I was told, and I don't know the numbers Lei so, but I was told and I'll try to find them that the GM take rate for Super Cruise is pretty robust. And they're pleasantly surprised with that. Blue Cruise is not as good as Super Cruise. ‚Åì think that's okay to say that without too much controversy because Blue Cruise is also much more limited.
 
 Lei Xing (36:38)
 Mm-hmm.
 
 Tu Le (36:52)
 I think GM has more miles that that's mapped. And so, you know, a couple of companies that I talked to during the conference, TomTom, and I talked to, so TomTom is being used by the Chinese companies outside of China.
 
 Lei Xing (37:03)
 I'm good.
 
 Yes, yes,
 
 yes. In fact, I can say that because the few level two plus rise that I did in Munich, every one of them talked about using TomTom for mapping navigation. Not for the HD map, but for the local. They wouldn't even use Google. They use TomTom, which is an interesting point.
 
 Tu Le (37:27)
 The other thing too is I spoke with someone from Here Technologies. So they're pretty, so I think TomTom and Here are the two major players outside of China when it comes to mapping, especially if you take out Google, then those two players kind of dominate. ‚Åì
 
 Lei Xing (37:32)
 And Here. Yes. Yes.
 
 Yeah, especially in Europe.
 
 Tu Le (37:52)
 It's starting to kind of all kind of piece together a little bit. We are.
 
 Lei Xing (37:57)
 Yeah, and then we
 
 we also have EREVs coming in the rest of the world from Hyundai, from GM, right? From others that are coming in the US market and the American market. Right? What happens in China? Right?
 
 Tu Le (38:06)
 The RAM.
 
 ‚Åì man, so
 
 And it should be mentioned. Let's circle back a little bit. I'm going to I'm going to help you Pat pat me on the back because you had texted a screen grab of Tesla's promotion last week. I said sales will probably be down in October, November, so I anticipate Tesla that do some sort of price cut or non price cut price cut and what an hour later an hour later you text me that so.
 
 Lei Xing (38:37)
 So yeah, so I think in these.
 
 Yeah,
 
 the lease goes up, I think, November 4th by $80. It's $3.29 to lease a Model 3 in Massachusetts. Yeah, not the standard version, the regular rear wheel drive version. So.
 
 Tu Le (39:06)
 Yeah, dude. So ‚Åì no surprises there. ‚Åì I'm looking forward to the baby gravity and I'm looking forward to the R2. I'm actually really looking forward to the Bolt because if GM markets it properly, I think there's a huge demand, pent up demand for that Bolt.
 
 And I don't know what the outdoor price will be because it starts at 29. If we add a bunch of features or a bunch of trim packages, what? OK, OK, fair enough. And then, you know, the wild card seems to be slate. You know, ‚Åì they've posted for those that are wondering, they've posted a few videos. So Google Slate Auto, they posted some marketing videos on YouTube.
 
 Lei Xing (39:46)
 mid 30s probably.
 
 Tu Le (40:06)
 They're kind of a kitschy, cool kind of fun. And it's almost like their positioning now is like you can accessorize it any way you want. And there's these speakers that you can take out. so it's a, and so do we, guess fundamentally two questions. Do we believe people really want an analog vehicle? And do we believe that people really want?
 
 Lei Xing (40:21)
 Obviously.
 
 Tu Le (40:35)
 a two-door truck. I think the analog stands a better chance than the two doors. but this could be the perfect vehicle for I would be hesitant to buy it for my son or something like that until I really understand crash worthiness because my son would have to be safe. so anyways, I don't really have anything else, man.
 
 Lei Xing (41:04)
 ‚Åì
 
 Tu Le (41:04)
 So
 
 no, so I take that back. GM also announced huge layoffs.
 
 Lei Xing (41:10)
 the
 
 EV stuff 3300 33,000 people
 
 Tu Le (41:13)
 Tennessee,
 
 Detroit Hamtramck, yeah. so we're seeing, and I've written this in the newsletter years ago. I've written this and we've talked about it. I said there's gonna be layoffs. So that's what's really happening. And then I think we talked about it last week, Georgia, their technical center is gonna be closed, GM's technical center. And I think AI is gonna take over a lot of those.
 
 those responsibilities of the people that. One thing that was really cool was ‚Åì Melody Lee Have you heard of her? ‚Åì She is the Chief Marketing Officer for Mercedes-Benz USA.
 
 Lei Xing (41:52)
 From who?
 
 okay.
 
 Tu Le (41:59)
 ‚Åì Two E's, so I'm assuming that maybe she's Korean American, but ‚Åì she worked at Cadillac as a director of marketing and she worked at Herman Miller. So she has a lot of experience of the premium side of marketing. She was a keynote last, yesterday, really, really great, great ‚Åì discussion, fireside chat. She talked about, you know, maybe this is not controversial to us, but
 
 Lei Xing (42:15)
 Okay.
 
 Tu Le (42:29)
 how the United States is becoming more multicultural. so figuring out how to market to the Latino community, the African-American, black community, the Asian community is important and it's a business decision. It's not a DEI decision, it's not this or that. And so ‚Åì she just said, census numbers for the United States tell us this is where the population is headed.
 
 Lei Xing (42:48)
 Yeah.
 
 Tu Le (42:59)
 And then she also talked about there's these new Mercedes commercials that John Hamm used to be the voice of the Mercedes commercials in the United States. And they were looking for a new one. And they had over 200 voiceovers, some famous people, some non-famous. And without knowing who it was, they picked Lucy Liu.
 
 Lei Xing (43:09)
 Mm-hmm.
 
 Okay.
 
 Tu Le (43:24)
 And the funny thing is, Melody was on stage. She said, I know what you're thinking. One small Asian woman picks another small Asian woman to become the spokesperson for Mercedes. Everybody laughs. She's like, that's not it. And she said that her voice over John Hamm's 20 points higher, like in the, ‚Åì cause they've launched some of these. So next time you see Mercedes, it might end, you know,
 
 Lei Xing (43:51)
 Wow, okay, I'll take that note.
 
 Tu Le (43:54)
 I had no idea that it was Lucy Liu, she was talking about that. like, you know how some executives, when they do fireside chats, they talk for 25 minutes and say absolutely nothing? This was really meaty, you know? And she's the USA, so nothing about what your struggles in China, you know, how do you market in China?
 
 Lei Xing (44:14)
 Well, in China, so
 
 China, Mercedes, right, I tweeted some of this stuff. They're working with the tennis, men's tennis number one player, Wang Choo-Chin, and then McDonald's in cross-collab in anticipation of their CLA launch. So it's completely different. But yeah.
 
 Tu Le (44:35)
 Yeah, she was really
 
 cool. ‚Åì I liked her. I liked Ralph's.
 
 Lei Xing (44:41)
 I think definitely
 
 in China, these brands, tend to sign up more brand ambassadors than the rest of the world, especially Chinese actors, ‚Åì sports professionals. mean, recent launches, we've seen this. The Li Auto i6 had this young actor.
 
 The D-19 had Fei Xiang. Fei Xiang is one of the most famous. ‚Åì I think he's a Chinese American. Very old, but very famous. Yeah, He has all these fans. yeah, he's happy.
 
 Tu Le (45:23)
 Well, even Cadillac, remember in April in Shanghai, they had the gold medalist ping pong player.
 
 But I also think that, I think that points to the demographic in China, it trends younger. And so more social media savvy, more personality driven.
 
 Lei Xing (45:38)
 When are we ‚Åì right, right.
 
 Lamborghini had their 20-year China celebration, I think last week, and the CEO, he said their average age, I think was like 32 to 35 for Lamborghini customers in China. It's crazy. Yeah. Yeah. Where did they get the money?
 
 Tu Le (46:00)
 Whatever,
 
 32 I I think
 
 I was making I think I was making like $50,000 Like you know, I'm just making that up but I wasn't like I wasn't making Lamborghini money. Let me say that so Anyways, Let me see if there's any questions. ‚Åì Why don't the EV maker so SS JJ asks?
 
 Lei Xing (46:22)
 no.
 
 Tu Le (46:29)
 SSJJ005 why don't the EV maker just check the battery health through their soft
 
 Lei Xing (46:36)
 Well, actually, we eluded this. ‚Åì I think currently, if we talk about a Lee Otto, if we talk about NIO, XPeng or any other other players, I don't think it's ‚Åì uncommon that because they did say, I think it was like 4 hours before the accident happened, they detected something. And they even notified the owner, but no action was taken. And Li Auto specifically said,
 
 that could have been something ‚Åì elapsed on their part on how that, when that happens. So, which means the battery health monitoring, it's constant. It's not a technology that's ‚Åì difficult. It's there, right? I mean, how NIO monitors their batteries and does the battery check after each battery swap.
 
 and in the battery swap stations. So it's not that. I think it's what happens afterwards. What actions needed to be taken. Nowadays, I mean, we talk about a smart EV, a smart phone on wheels, right? What happens with a car? They can see it, especially the battery.
 
 Tu Le (47:45)
 I think there's...
 
 Lei Xing (48:03)
 I mean, they probably have a whole data center of what's going on.
 
 Tu Le (48:08)
 And they also have filters that say if the temperature goes above or below this much, this Celsius or this Celsius, then you ping us an alert and then we'll alert the customer or it pings an alert to the customer directly.
 
 Lei Xing (48:22)
 Yeah, this is
 
 not difficult to achieve. It's what happens afterwards with the driver, with the owner, what kind of actions they take that could
 
 Tu Le (48:35)
 And
 
 remember that these are brand new vehicles. This is ‚Åì a Mega that's never been built before. a lot of, as more more customers buy it, put miles on it, there are new things that pop up that they don't know about. You know, cause this is not an existing product that has 12 years of history and you can really dial it into these certain things that are the high failure rates.
 
 Lei Xing (49:05)
 The other thing about this, was talking with some of the other industry people and friends, know, chatting ‚Åì some of the competitors. And I think the other question that they bring up is China's fascination with speed. And by speed, mean, 5C, 6C charging. What that does to the battery ‚Åì could be another issue, especially with Li Auto. ‚Åì
 
 and others, know, 10 minutes we can add 500 kilometers. Yeah, these are things what happens to the battery and do that repeatedly. I think others are skeptical of it, but to the consumer, it saves me time. So what are the trade-offs?
 
 Tu Le (49:38)
 Well the Mega was one of those early ones that had ultra fast charging.
 
 ‚Åì I think.
 
 With a Li Auto actually I wanna say ‚Åì market wide, maybe there needs to be a third party that does some survey that says what's tolerable, Below five minutes, below seven minutes where I don't get start to get upset. And then having that knowledge instead of, Lei, you did three minutes so I'm gonna do two minutes. Are we over engineering or taking on too much risk?
 
 And nobody cares that it went from three minutes to two minutes, as long as it's under 4. Those questions need to be answered. But that's also an outcome of the just intense competition where Tu has to always one up Lei when he launches something new or better.
 
 Lei Xing (50:48)
 That exactly is,
 
 is it? Yeah.
 
 Tu Le (50:53)
 And the last thing I'll say is that it's really still very difficult because Li Auto hasn't articulated any explanation. So is this a systemic issue across all Megas or was it one bad part in a batch of components?
 
 Lei Xing (51:11)
 It was a...
 
 yeah, it looks like it was a batch of, right? It's 11,000 units out of 20, some half of what they have sold, the Megas So it's a batch.
 
 Tu Le (51:23)
 But we still don't know that. They could be just being abundantly cautious and looking at this as a marketing opportunity to really ease fears and ease the hesitancy about purchasing a Li Auto vehicle, which is already in the public sphere for other reasons. So great question. ‚Åì But the other thing that I will
 
 Lei Xing (51:31)
 We're good. Good.
 
 Tu Le (51:53)
 note with that question, is now we get into how much do I want GM, Li Auto, NIO, XPeng, Ford to know about me. Because if they're monitoring my battery, they probably know where I am. Do I feel comfortable with all this information that they have of me? And so that comes back to the data privacy stuff.
 
 And so I don't know where I feel about that, to be honest with you. I give access to Apple for my calendar and stuff like that. They obviously have my contact list. But Apple does prompt you now, allow to share data across apps. You get that window that pops up. So at least you get to choose. Before, it was a single disclaimer. And you checked it and you clicked.
 
 Lei Xing (52:40)
 Yup, yup, yup, yup, yup, yup, yup.
 
 ‚Åì I think
 
 in China, speed and convenience outweighs everything else.
 
 That's, you know, I mean, we've we are part of it. We're consumers. I mean, every time we're in China, what do we do? ‚Åì
 
 Tu Le (53:06)
 I guess
 
 the other thing too is like, you know, I for sure don't feel comfortable with companies knowing what my kids are doing and stuff like that all the time. So, one more. SPX Nomad 2187. Great questions for those that are still watching the show. If you have any other questions, feel free to post them. How about cell companies?
 
 Knowing where everyone is. Hey, see? I agree, SBX. He basically said phone companies that know where everyone is at all times. think, again, I don't know where I stand on that. And these are great questions. And each country, each region has a different attitude towards it from a government standpoint and policy standpoint. And then I think Chinese feel a lot different.
 
 than Europeans and Americans for sure on those attitudes. So it's a great debate. I don't think there's a right answer, but there's a right answer for you and your family, I think. what we should demand, whether you're Chinese, American, or European, is if, you are building the next great iPhone.
 
 and you use my data to consolidate amongst other people's data so that you can monetize it as a new service you're providing, you should pay me for my data.
 
 You know, we shouldn't have a disclaimer once we turn on a machine or a product for the first time saying, you can use my data. It should say, we're happy to compensate you for it. And it doesn't need to be, you know, a bunch of money, but guess what, dude? I need to understand and have better control over it. And if you want to use my data, then it's, it's.
 
 It's like taking a picture of me. You'd have to pay me if you want to use it in your marketing campaigns. Anyways, we're getting off the topic of. ‚Åì But cool, man. Hey, ‚Åì everyone, happy Halloween. Be safe tonight. Don't be too scary.
 
 Apres, Apres and Arnaldi. Sodium ion battery. When will be in EV? It already is.
 
 Lei Xing (55:32)
 What happened? ‚Åì
 
 So I had to pick a roadmap, So sodium ion battery is next after LFM and NCM where solid state, by the way, China just announced a new name for semi-solid state batteries. You no longer can use that. Now it's called the solid liquid batteries.
 
 Tu Le (55:48)
 hybrid.
 
 So it's more confusing.
 
 Lei Xing (56:16)
 Yeah, so sodium ion, I think it's small batch slowly in applications we're having that, but volume is very small. Whereas the solid, truly solid state battery, I think we've heard already enough comments that this is something way out into the 2030s. Starting 2030, so next decade. ‚Åì But so far, right, LFM dominates.
 
 Tu Le (56:43)
 I think what's ‚Åì important is that it is about technology, but LFP, there's so much capacity for LFP that it's going to be hard to beat for the next 10 years from a cost standpoint. ‚Åì Now availability is different, especially when there's tariffs and artificial ‚Åì lifters for pricing, but CATL could
 
 Lei Xing (56:57)
 Yeah.
 
 Tu Le (57:10)
 pretty much supply every automaker almost globally. And you know, the combination of CITL, BYD, Goshen, Calb, AESC, they could definitely supply a lot of LFP to most automakers around the world alone. So LFP is gonna be Here for a very, very, very long time.
 
 I'll catch you on DMs, man. Have a good weekend, everyone. We will catch you all next week.
 
 Lei Xing (57:35)
 Bye bye.