March 14, 2026 | Weekend Drive: Automakers pay big to retreat on EVs, but could the market make a comeback?

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apply at autonews.com Welcome to this weekend drive edition of Daily Drive for

the second week in March 2026. I'm Kellan Walker in Las Vegas. We're breaking

down some of the biggest stories in the auto industry from the past week and

looking forward to what's in store in the days ahead. There have been all kinds

of developments this week on the EV front. We'll talk about Honda's costly

retreat as they cancel three EV models, the growing tally of auto maker

write downs and the new market forces that might reverse some of those trends

like if the war in Iran pushes gas prices up to six bucks a gallon. Joining me

today to talk about it is Michael Martinez, automotive news reporter who

covers Ford and the UAW for us. My man, Mike, welcome back.

Kellan, when you were out Jake was able to do everything in one take. So, you

know, no pressure. Here you go. And in for Larry Velocquez this week, we're

joined by Lindsey Van Hully, deputy editor at automotive news covering the

electric vehicle ecosystem. Lindsey, welcome to this madness that we call

weekend drive.

Long time listener. First time co-host happy to be here.

All right. So Michael, let's start with probably the biggest story of the

week. Honda's canceled three EVs, the zero series SUV, the zero series

saloon, and the Acura RSX. They're expecting losses up to nearly $16

billion. What's your take on this, Mike?

Well, I don't think it's a stretch to say a lot of automakers got the whole

EV thing wrong. But I think some automakers got it more wrong than others.

And I think Honda is one of those automakers. And I don't just mean the

demand curve seems like everybody, you know, was a swing in a mess in terms of

how many customers actually want this type of product. But I'm also mean the

type of EVs and the kind of platform you need to develop them at scale and

to hope to make any money at them. Honda always seemed to be behind the

eight ball. They tried to catch up by partnering with GM that led to the

prologue, which is apparently going away after just a couple of years.

Probably, you know, paint that as a disappointment. After that, they

sighed to pivot to the zero series that looked like probably something they

should have done from the start, a dedicated platform that could underpin

multiple models. The concepts looked really sleek and cool. Maybe that would

have been something if they had started five years earlier or 10 years

earlier. But as they said in their announcement, they needed to stop the

bleeding. They didn't see any way to turn a profit in these current market

conditions. It seemed like they were always playing catch up. And they

ultimately realized it was a race that was too long for them to ever hope to

win. And Lindsay, this brings the industry's total EV restructuring bill to

what, around $70 billion now, what does that mean for the industry?

I mean, I think Mike just touched on it, right? It really reflects the

degree to which automakers really overestimated how fast this market was

going to develop. And, you know, it's everything from, you know,

write downs of investments, you know, losses, just basically trying to

get out in front of this. And I think some of them have said, you know,

if we take all of this up front, we can sort of get it out of the way and

reset and move forward. And I think that's what a lot of this really

just reflects that, you know, they don't need as much factory capacity.

They don't need as much battery capacity. Maybe the some of the models

that they were planning may not have as much demand. And so I think that's

that's what we're seeing here with, you know, canceled vehicle lines,

converting some planned EV capacity to internal combustion,

investing more in hybrids than in EVs. It's sort of this reflection that,

you know, they're trying to match where demand is with with the capacity

that they have and the investment that they have. It's interesting because,

you know, the analysts I have talked to you have said, you know, they don't

expect this to be kind of a wholesale retreat from EV and battery

developments. You know, they're still going to be investment.

They're still work on bringing down battery costs.

They're still work on affordable EV platforms. We don't know, you know,

under a new presidential administration, do, you know, regulations shift again.

You know, there's still this discussion about, you know, EVs are expensive.

And so they're trying to find ways to bring down that price point,

not just the not just the price point, but the cost that contribute to that

price point. So I think it's, it's a sign really of just this broader reset

that's on, that's ongoing and everyone sort of taking this view of,

you know, how much space and how much, how much capacity do we really need right

now? Well, Lindsay, that's, that's funny. You bring up reset because now we

saw EV registrations drop 41% in January with market share tumbling just

5% and S&P's Tom Libby called this a reset. But do you think this is a temporary

adjustment or a fundamental shift? You know, it's, it's interesting.

I think to some degree, we'll see, you know, when I've talked to analysts about this,

they have, they've talked about, at some point, EV sales are going to pick up again.

EV demand is going to pick up again. There's going to be growth over time in this segment.

And so I think this is a reflection of just where we are right now.

There's still price challenges that are out there.

There's still charging challenges, you know, the network of EV charging nationwide is still

expanding. A lot of these things, I think, still need to be addressed before we see a lot of that

really big EV development. I would, I mean, it's hard to say what's going to happen

over the long term. I think at least for the near term, this is where it's going to be and

demand is probably going to be a lot smaller without, you know, that, that federal tax incentive

that went away after, after the end of the fall. But, you know, long term, it seems like there's

still going to be, at least there's the belief out there that there's still going to be consumers

who are going to want these and the market will shift there eventually. Mike, what are your thoughts

on that? Isn't everything in this industry, a temporary adjustment? It's so cyclical.

We're riding the roller coaster, things go up, down, things are invoked, there they're out.

I think that, you know, to Lindsay's point, everybody's making these adjustments because of

the current market conditions. But look at what we're going to talk about in a little bit,

the war in Iran. If those prices last, the oil and gas prices, we could see a quick pivot back

to EVs. If there's a Democrat in the White House in 2028, we could see a quick pivot back to EVs.

So, temporary, probably, we just don't know how long that's going to last, is it a couple years,

a half a decade? What? So, I'm sure the levels will fluctuate, but to Lindsay's point, at least in

the near term, we may be finding that baseline right now. All right, coming up, we'll talk about

how suppliers are getting squeezed by soaring diesel prices, Ford's promise of better transparency

with suppliers and whether new EV models could actually benefit from rising gas prices. That's next

on Weekend Drive. The EV transition has been slower than many people expected,

and the financial strain isn't just hitting automakers. On this week's episode of the Automotive

News Shift Podcast, I'm joined by Mohamed Faturi, Director of the Engineering and Power Solutions

Division at Bosch. He explains how tier one suppliers are dealing with the pressure of a

softer EV ramp, shifting customer demand, and policy uncertainty, and how they're adapting

in real time. From day one, you think about options and flexibility. If you are planning

based on flexibility or optionality, then you'll have the leverage in the future if need be

to pivot very quickly. I'm Molly Boygon. Join me on Shift, available this Sunday, wherever you get your

podcasts. Welcome back to Weekend Drive. I'm Kevin Walker with Mike Martinez and Lindsay Van Hully.

So Mike, let's shift to suppliers this week. We reported how diesel prices have jumped 20% because

of the Iran conflict, and that's really squeezing supplier margins. There's so much pressure on

the supply chain between these geopolitical tensions and just normal everyday logistics.

Are we reaching a breaking point? Yeah, you know, there's a bunch of jobs I wouldn't

want to do. And when it comes to the auto industry, I think we're going to supplier is

top of that list. You just look at what they're dealing with between all the abrupt

cancellations in EV programs that they've spent years and billions of dollars tooling up for.

You have this shift of automakers trying to bring more and more supplier work in house.

You have, you know, faster product development times. And then obviously with this current

situation with the straight of Hormuz, you're losing a lot of not only oil that's increasing

transportation costs, but also plastics materials, aluminum, liquid natural gas. There's a bunch

of building blocks to vehicle parts that they're also probably not getting. You might as well

just add hail and locusts to this list of things. Suppliers are dealing with it's not great.

And what makes it tough is that this is already a pretty low margin business auto in general,

but specifically for the suppliers. So when you talk about something that's going to raise their

prices, especially for these small guys, even if it's just one percent or two percent of their

overall costs, that's going to have a major impact. So breaking point, we have to be close,

given everything else that's going on. So Lindsay, kind of piggybacking off of what Mike just said,

Flavio Volpe of the automotive parts manufacturers association said transportation is typically 5 to

6% of operating costs. So a 20% fuel increase adds about 1% to total costs. I know it doesn't sound

huge, but in context, it does sound pretty significant. What are your thoughts?

Yeah, it is. And I think our colleague Greg Lison in Canada, you know, talked about this,

you know, kind of summed it up pretty nicely in just this idea of the just in time

industry that we all work in, right? That there's very few alternatives to trucking. We don't

store parts for very long. You know, they really get moved when they're needed in the assembly plant.

And so that makes rail not necessarily an option, fuel costs are hard to get around. And so it may

seem small, but when you're working in that that just in time when, you know, it's so critical that

the part arrives when it's supposed to, it just it makes it so that it's a really hard thing to get

around. Now, Mike, I've been waiting to ask you this all day, because you know how much I just

love a good Ford story. Now, we had news this week that Ford is promising better transparency to

suppliers. Please explain to us what the story is here. Yeah, so Lizdoor relatively new Chief

Supply Chain Officer at Ford within the past half decade or so. They have a yearly meeting with

their top suppliers. And this year she told them they're going to be more transparent and that

they're going to try to give them now three year windows into their product cycles, which I love

to hear as somebody who needs to report out future product every year. Great job guys. Bump it up

to five while you're at it. That'd be great. But in all seriousness, this is a ray of hope for

the suppliers after all the stuff we were just talking about. They need security. They need to

know what the plans are. So like I referenced, they're not spending a bunch of money tooling up

and preparing for a model that's just going to be canceled or shelved anyway. So Ford struggled

with its supply chain relations when Lizdoor first came in. She revamped their whole supplier program

from how it used to be to how they reward contracts. Now they still struggled because obviously

Ford struggled with a lot of things in terms of recalls and terms of what programs it is or isn't

working on moving forward. So if I'm a supplier, I'm feeling pretty great coming out of this meeting.

Obviously, you know, that was the intent. So we'll see if the company can follow through on it.

I imagine if this works, it's the type of perspective you're going to want to see suppliers

asking for from other automakers. And that was what I was going to ask you, Lindsay, exactly

a mic just said, because you know, you used to cover GM. Do you expect other automakers to take

the same route? We've written a lot over the past couple of years just about this issue with

stranded capital, right? And it's really difficult. If you're a supplier and you're trying to

figure out where to make investments, do you go all in on EVs? Do you try and diversify?

How do you make those investments? And it is difficult. And I think for suppliers, there is much

of that kind of window into product plans as possible. I think is going to be really important.

I think to the points Mike made earlier, there's a lot of things that throw wrenches and all of that.

It's like the EV demand curve that we've seen flattening out. And whether it's tariffs,

whether it's it's unforeseen events, you know, kind of like that, fire at the aluminum plant.

That's affected output of some of the pickups. I do know there's a push for transparency,

even deeper than that, too, right? And just trying to really get at how do you how do you get visibility

far enough down the supply chain so that you can see when some of these things might happen?

You know, is there disruption in some place that might impact production in some place else?

And so this question of transparency, I think, is really interesting both from the product planning

and trying to figure out where you make that investment. And also, how do you get enough visibility

into tier one, tier two, tier three, tier n, you know, so that if there's a tornado someplace

that you can react, you can know early enough and react enough that you don't have this really

costly downtime, which impacts both the automaker and the supplier.

All right, so here's a very interesting angle. Now, Mike, gas prices have been climbing because

the obvious, the issue and situation in Iran, but we got these new affordable EVs on the way

from Rivian, like the R2. Could rising gas prices actually help revive EV demand?

Sure, if it lasts long enough, I think customers would definitely take another look to see if the

dollars and cents make sense for them. You mentioned the R2. It's interesting. I don't know if that

will benefit from this situation, particularly because it was announced recently that Rivian's

launching with the more expensive model. I know automakers typically do that, right? But R2 is

pretty important to Rivian. You could argue it's a make or break moment for them. Sales of its

other models are not doing well. It's losing a lot of money and they need this R2 to be a big hit.

So, they have been promising a lower priced $45,000 model. Found out that's not going to come maybe

for another year or so give or take. It's going to launch with a $58,000 model. So, would that be the

answer if gas prices are high? Rivian's a lifestyle brand pretty much, right? Like it's for outdoorsy

type people. Pretty high costs on both the pick up and the SUV these days. They're larger than I

think what a lot of automakers today think they need their EVs to be. So, the R2 could be an answer.

I'm just not sure the early models it's going to come out with would help save customers that much

money. Maybe a better option might be the Chevy Bolt 2.0, right? Our colleague John Irwin was just

test driving it. It seems like it could be a nice option although that limited run seems like it's

going to be very limited. So, will Chevy be able to produce enough of them? So, a lot of questions,

but there are some interesting new EV offerings coming if it makes sense for you as a customer.

Well, that's how I was going to ask you, Lindsay. You are our former GM expert. Is everyone going to

be buying bolts? Is everyone want bolts? You know, Chevy will tell you that there is a very loyal

bolt ownership base and that there's this customer base that have been in these older bolts that

may want to trade up for the new one. It's not a price point and when I've talked to dealers,

they've said, you know, we're excited about it even being an EV, even in this market because of

its price point. Whether demand is high enough that makes that case that this is the place that

EVs need to be to really spur that demand. I think we'll need to see, right? It just went on sale

earlier this year. So, they're just now beginning to really get out there. But when we start to get

sales numbers from GM every quarter, it's going to be interesting to see what happens there.

But when I've talked to dealers about it, they've pointed to that the Equinox EV really to

another degree just for those price points because right now without the tax credit, you might get

some automaker and dealer incentives, but you still have to have the price point at a place where

people can actually get into it. Do you think with American consumers how we have our love for big

vehicles and SUVs that the bolt, I'm not going to say what fall on its face, but not do as well

because of the size? I don't know. I think it did really well when it was out originally. And so,

I think the question's going to be just does it continue to resonate with those previous bolt owners

and does it help bring people in from other brands that have been looking for an EV at that

price point. So, I think it's going to be really interesting to see how it does that have 2.0

does. Gotcha. Now, Lindsay, we talked to plug CEO Jimmy Douglas this week on Daily Drive. He made

the argument that predictions of a used EV price collapse are flat wrong. He says interest and

prices for used EVs have only gotten stronger so far this year. What do you make of that?

I think it's going to be very interesting as more of these least EVs return to the market.

And we know the projection is going to be this is going to be increasing over the months and

years ahead as more of these leases are expiring. And so, I think we'll get a better read on what

actually happens in that market when more of these are out there. It is interesting when I have talked

with analysts with some dealers recently, just reporting on the potential impact from higher

gas prices and what that might do. The used EV argument has come up a lot in that the idea that

there are a lot of incentives right now to try and move new EVs and they're competing against

one, two, maybe three-year-old versions of the same model at potentially a lower price point.

And so, if you're coming into it and you're looking for an EV maybe your first time EV buyer,

maybe a used EV at that price point is a good way to get into it. Maybe at least

might make more sense. But I think the used EV question is going to be very interesting to see

what happens. The dealers I've talked to one actually recently said he's already looking for

used EVs at auctions to try and get ahead of potentially demand shift there. Analysts have said

it's a way to potentially educate consumers, give them a more affordable way to get into an EV

and try it out. So, I don't know, I think it'll be, a lot of it I think is going to be determined once

more of these return to the market and we begin to see what that actually looks like. But at least

the people I talk to say there's an opportunity with used EVs that we're going to begin to see this

year that maybe we just haven't yet because of numbers. Perfect. All right. Mike Lindsay, thank you

so much for joining me. Thanks, Kyle. Thanks. That's all for this weekend drive edition of Daily Drive.

I'm Kellan Walker. Thanks to automotive news executive producer Jake Nier for his help on

today's podcast. You can get the latest news on Honda's EV retreat, supplier cost pressures,

and everything happening in the auto industry at autonews.com. Come back on Monday for a conversation

with Mohammed Fatturi, director of the engineering and power solutions division at Bosch. He talks about

how Tier 1 suppliers are dealing with financial strain from a slower than expected EV transition.

The take rate of the battery electric vehicles in the market were not as expected by the industry,

but this was also a trend that we had in our scenario planning. So we had other plans based on

the approaches that we had to be able to shift our product portfolio as well as our investments

commensurate to the needs that we have from the market. We'd love to hear from you,

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