Where automakers' big bets stand
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Illustration: Maura Losch/Axios
Three technology themes will define the future of the auto industry.
Electric vehicles
EVs have grown to about 9% of all new cars sold in the U.S., but despite big discounts and more choices, charging and affordability are still a hindrance.
- Even the market leader, Tesla, is struggling. Sales have plummeted worldwide as rivals compete for attention and controversy grows over CEO Elon Musk's political activity.
- If President Trump yanks tax credits and manufacturing support for EVs as promised, higher prices and slower EV adoption are likely.
- Republican lawmakers are also looking for a legal path to repeal California's EPA waiver, which permits it and 11 other states to set EV mandates phasing out gasoline cars by 2035.
- 'It would take a miracle" for carmakers to hit the states' first target for 35% of 2026 models to be electric, the industry's trade association says. Consumer demand just isn't there.
- Without a repeal of the waiver, they'll have to dump EVs at fire sale prices to comply, and limit consumers' choices.
What to watch: China's BYD might have just changed the game by lowering one of the barriers to EV adoption.
- The Chinese manufacturer unveiled a new EV platform that can recharge in as little as 5 minutes — about the time it takes to fill a car's gas tank.
- But boosting the appeal of EVs will also require lower-cost batteries and high-volume manufacturing to bring down prices.
Autonomous vehicles
After years of frustration and slow progress, only one company — Waymo — operates a real commercial robotaxi service today.
- Waymo provides 200,000 driverless trips per week in San Francisco, Los Angeles and Phoenix, and is beginning to add robotaxis to Uber's platform in other cities.
- Meanwhile, autonomous trucks are getting closer: One company, Aurora, plans to go fully driverless next month in Texas.
The intrigue: Huge leaps in generative AI are enabling a new approach to autonomy using end-to-end, self-learning systems.
- Instead of driving millions of test miles and then manually coding instructions for every edge-case scenario, AV 2.0 systems use advanced AI to train a virtual driver how to reason like a human — even in unfamiliar driving situations.
Stunning stat: U.K.-based Wayve says its AI easily adapted to U.S. roads (including driving on the opposite side of the road!) after just 500 hours of local training.
Software-defined vehicles
Tesla pioneered the upgradeable "computer on wheels" back in 2012 with the introduction of the Model S. But the rest of the industry is taking a long time to catch up.
The dream is that the car will one day become a digital platform — like a smartphone or tablet — that generates billions of dollars in recurring revenue.
- With over-the-air updates, problems can be easily fixed and buyers can add features or services that weren't available at the time of purchase.
Yes, but: That requires replacing scores of tiny computers embedded in individual components with a centralized electronic system that controls everything from drive-by-wire steering to entertainment.
- Automakers lack that systems expertise, which is why they're furiously recruiting talent from Apple, Google and other tech giants.
The bottom line: All three trends are within reach but require more time, effort and investment.
