Author: Larry Evans

Zach’s recent post on the growth of ICE and EV sales in 3Q brought up a question: How far do we have to go before EVs start reducing the total number of ICE vehicles on the road?Looking at the latest data from Hedges & Company, from 2012 (248.7 million) to 2024 (296.6 Million), the US fleet grew by an average of 4 million vehicles per year. Over the same period, sales averaged slightly over 16 million vehicles per year. In other words, roughly ¾ of sales replace vehicles taken off of the road and ¼ add to the fleet.

Last week, Carolyn Fortuna had an interesting article on Kamala Harris. Within that article Harris had a quote that asked an important question:“Why. Didn’t. I. Separate. Myself. From. Joe. Biden?”Overall, the most obvious answer to that question was that she didn’t have much time. Introducing ideas takes time, especially when you are busy trying to introduce yourself to people. Getting those people to understand those new ideas takes more time. Getting them to see the implications is not quick or easy. Candidates tend to listen to polls for what people want now and then repeat it back to them. Staying the course is easier.But we have time now. Time before the next presidential election. Time to explore new ideas. People have time to wrap their minds around them. We have the time to change course. Time to explore how to separate ourselves from the past and take a new path into the future.Trump’s simplicity clearly reveals flaws in approaches that might have been less noticeable with a more moderate execution. Opinions are shifting against Trump’s policies, especially regarding trade. We can further expose bad policies. We can create contrast with better policy. Leaders have an opportunity to lead on policy ideas, even if they are not yet in power to execute them.We also are free to separate ourselves from Biden. Blind loyalty does not help. We are free to criticize. The election is over. We do not have to debate whether distancing ourselves helps Trump. People can still support their team while policy evolves. Holding onto bad policy out of loyalty hurts us going forward.Which gets to another article by Steve Hanley on trade. Whether or not you think anyone can truly win a trade war, the US is clearly losing. Tariffs are being taken up by a the Supreme Court this week, which could have a long term impact not only on trade, but also on Presidential powers. A shift in direction on trade could differentiate from the disfunction and lead to better overall policy moving forward.

With the Japan Mobility Show around the corner, attention is being paid to a market-specific vehicle form factor: the Kei Car (or K-Car, not to be confused with the ‘80’s Chrysler). These tiny vehicles are largely defined by regulation. They can be no more than 3,400 mm long, 1,480 mm wide and 2,000 mm tall. The most typical vehicles look like rounded boxes with the wheels pushed to the corners, reminiscent of the square watermelons that are also popular in Japan. Power is limited to 63 hp (47 kW). Originally intended for young people, they have increasingly also become popular with retirees. Overall, the best-selling car and best-selling EV in Japan are both Kei cars.

BYD recently launched refreshes of its DM-I models for 2026. Most recently the Qin L, Song L, and Song Pro. Typically, BYD refreshes models in 1Q when sales are seasonably depressed in China. However, BYD has essentially refreshed its entire DM-I lineup out of cycle. This will let every model qualify for the revised 5% purchase tax exemption next year. It also means entry level models have moved up from roughly equivalent range of a Chevy Volt to approximately a first generation LEAF (~133 km). Meanwhile, their more premium models have increased to 200-250 km of EV-only range. Beyond the EV-range, these models use the electric motor as the primary means of propulsion. That already made them superior to ICE-centric PHEV’s that engage the engine regularly for moderate acceleration or highway operation, regardless of range rating. The new models now have enough range to cover daily driving on battery power alone, typically not needing to be charged daily.This added EV capability tends to come with upgraded interiors and additional features. BYD’s active dampening DiSus-C suspension is now standard on more models. The Song L DM-I was also updated with semi-hidden door handles, ahead of the anticipated ban on pop-out door handles in China. Features like HUD, heated/ventilated/massaging seats and onboard refrigerators come standard on more trim levels. Looking through the spec sheets on the BYD’s Chinese website, the cars have significantly improved while prices have stayed largely the same… but intelligent driving was dropped from some models.

Earlier this week, China’s ruling Communist party met in a plenary session and developed recommendations for the nation’s 15th five year plan, which would run through 2030. There are many aspects of the recommendations that could be explored in more depth, but several of the recommendations are specifically relevant to clean technology. Regardless of how you feel about China or their political system, they lead in many aspects of renewable energy and electric vehicles, and their national plans have global implications.In looking through the coverage, much of it seemed to focus on the outline bullet points, without the underlying context. As a result, they often added in assumptions that did not reflect the actual recommendations. As the recommendations were published (toward the bottom of the page), the most relevant sections to cleantech are quoted below. I added a few notes, but found it interesting to see the actual recommendation text, starting with the economy and manufacturing:“It was noted that we should build a modernized industrial system and reinforce the foundations of the real economy. To this end, we should keep our focus on the real economy, continue to pursue smart, green, and integrated development, and work faster to boost China's strength in manufacturing, product quality, aerospace, transportation, and cyberspace. The share of manufacturing in the national economy should be kept at an appropriate level, and a modernized industrial system should be developed with advanced manufacturing as the backbone. We should upgrade traditional industries, foster emerging industries and industries of the future, promote high-quality, efficient development in the service sector, and develop a modernized infrastructure system.”

Japan has been a tough market for import brands. The top 10 automobile brands in the country last year were all Japanese. Products from foreign brands are often not a good fit for the market and customers tend to support the home team. Many automakers have tried to break through, but few have been successful. EVs that once looked promising have also failed to gain significant share. However, perhaps due to the domestic brand strength, Japan also has not put up the kind of trade barriers against EVs that we tend to see in the West. That creates an opportunity. BYD seems to be taking that opportunity seriously, with an expanding lineup of commercial and passenger vehicles, new partnerships and distribution channels, and aggressive pricing.

I was first introduced to Atalanta Climate at the Hardware Meetup for Climate Week NYC. The company had been carting visually intriguing prototypes of their Ovi carbon dioxide (CO2) removal devices around the city on trailers behind bikes, showing them to both interested locals and global leaders in town for the UN Climate Summit. While this is not the only CO2 removal system, the indoor application addressing both health and environmental concerns was interesting. Through follow up conversations, as I started to wrap my head around the technology and applications, it only became more interesting.The idea for the company originated from founder Sally Chen’s experience in San Francisco during the California wildfires. Opening windows represented a health hazard, and ventilation let smoke in. Unfortunately, wildfires are likely to become more prevalent due to climate change. In many areas, trees are burning faster than people can plant them. The need for air purification continues to grow, as does the need to address CO2 levels. Sally’s software background combined with the chemistry and hardware expertise of cofounder Lucas Dong, a PhD in Environmental Engineering and professor at Georgia Tech, to create Atalanta Climate.

As widely reported today, GM announced in a public filing that it is taking on $1.6 Billion in charges associated with scaling back US EV manufacturing capacity. The capacity reduction was justified in the filing because “the termination of certain consumer tax incentives for EV purchases and the reduction in the stringency of emissions regulations” are expected to slow US EV adoption.The $1.6 billion was broken up into “non-cash impairment and other charges of $1.2 billion as a result of adjustments to our EV capacity. In addition, the Company has incurred charges of $0.4 billion, primarily related to contract cancellation fees and commercial settlements associated with EV-related investments, which will have a cash impact.”In addition, the company indicated that this might not be the end of the scaling back. “The reassessment of our EV capacity and manufacturing footprint, including our investments in our battery component manufacturing, is ongoing…”

Over the weekend BYD introduced a refreshed Han, increasing the battery range of the DM-I (PHEV) to 245 km (152 mi), almost doubling the battery range. More than many early BEV’s and enough range to cover typical weekly usage with a couple of charges. In addition, fuel efficiency once the battery is depleted increased to 3.44 l/100 km (68 mpg). On the BEV Han, range increased to 635 km (394 mi) on mainstream models and 705 km (438 mi) on the top spec, up from 605 km and 701 km on previous models.While new product was being launched, China announced significant regulatory changes: in order to qualify for the purchase tax  exemption, PHEVs would need to have a range of at least 100 km (62 mi) and BEVs would have to meet stricter efficiency targets. Several other regulatory announcements, particularly around pricing, and product announcements were also made over the weekend, with more anticipated. Looking at product and regulation together helps to illustrate BYD's overall position in the changing Chinese market, with implications that extend beyond their borders.

At an event at their new factory in Bahia, Brazil, BYD Chairman Wang Chaunfu personally delivered its 14 Millionth NEV (BEV and PHEV) to Brazilian President Lula da Silva. The new BYD factory replaces a former Ford plant on the same site that closed several years ago. Local politicians praised the plant for rejuvenating the economy, providing both direct jobs and indirect benefits to local businesses.The vehicle delivered to Lula was a special edition Song Pro DM-I, manufactured at the plant. The vehicle is currently produced alongside the Seagull and King (aka, Chaser 05, Seal 5). Thirty of these vehicles will be provided for the November COP30 UN Climate Change Conference in the Amazonian city of Belém. After the event, the vehicles will be donated.