Welcome to the Daily 5 report for Wednesday, April 23.
Looking at the top stories in the auto industry today, there's an inescapable link to China and its influence over the world of automaking. Some might even call it dominance.
First, President Donald Trump's comments last night about the possibility of lower tariffs on China helped spark a major market rally on Wall Street.
Click here for real-time updates on automotive stocks.
"(China tariffs) will come down substantially but it won't be zero," Trump said. The president added that "we're going to be very nice and they're going to be very nice, and we'll see what happens." He also said he didn't need to "play hardball" with Chinese leader Xi Jinping, Bloomberg reported.
Read more: Live updates on tariff news and impacts
Interactive map: Auto manufacturing sites in Canada, the U.S. and Mexico
As our Hannah Lutz wrote today, Trump's tariff policy seeks to increase U.S. auto production. But it's virtually impossible to build an EV battery from start to finish in the U.S. now. China is a top supplier of many essential battery materials and almost the sole refiner of elements that go into batteries.
And the rapid implementation of the tariffs means automakers and suppliers don't have time to solidify the domestic supply chain intended to break their reliance on China.
Our story says 37 of the 54 electric and plug-in hybrid models sold in the U.S. last year relied on suppliers outside of the U.S. and Canada for more than half of their vehicles' parts, according to an analysis by IDTechEx.
This story from Pete Bigelow quotes a McKinsey & Co. report saying electrified powertrains already account for half of all new cars sold in China — with 45 percent of Chinese consumers saying their next car will be a battery-electric vehicle. Only 12 percent of U.S. consumers said their next vehicle would be a battery electric — a number that inched up 1 percentage point year over year, Bigelow wrote.
Meanwhile, there was plenty of news coming out of the Shanghai auto show. Lexus unveiled a radically restyled eighth-generation ES sedan that kicks off a new brand design language meant to better evoke the addition of a battery-electric drivetrain option, Hans Greimel reports.
Nissan Motor Co. said it will sell its first electrified pickup in China later in the year, under the familiar name Frontier Pro, as the Japanese carmaker plays catch-up in hybrid powertrains, Greimel wrote. Nissan also committed to invest an additional 10 billion yuan ($1.4 billion) in China and says it sees the nation's intensely competitive automobile market as fertile ground to help develop EVs.
In other news today, Lithia Motors Inc. reported net income of $211.2 million during the first quarter, a 28 percent increase from the first quarter of 2024. The report from the nation's largest publicly traded auto dealership group wasn't good enough for Wall Street — shares fell more than 5 percent.
And finally, Toyota Motor North America's 30-year-old engine and transmission operations in West Virginia continue to grow. Toyota said it will invest an additional $88 million in the plant in Buffalo, W.Va., to produce a new generation of hybrid transaxles. The investment will pay for construction of the new line, including site preparation, equipment and installation, a plant spokesman confirmed.
That's it for now. Have a great rest of your day.
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— Philip Nussel, online editor
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