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Automotive News Asia Editor Hans Greimel discusses Sony Honda Mobility’s decision to cancel its Afeela EVs. U.S. auto sales are heading for a rough first quarter. Plus, Stellantis workers face parking tickets for driving the wrong brand.
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Welcome to Daily Drive.
For Thursday, March 26, 2026, I'm Kellyn Walker
in Las Vegas today on the show,
US auto sales are heading for a rough first quarter.
MG Motor brings semi-solid state batteries
to Europe's mass market
and Stellantis workers face parking tickets
for driving the wrong brand.
Plus, Automotive News Asia Editor Hans Grimel
talks about Sony Honda Mobility's decision
to cancel its Afeela EV models.
Without the cars, it's hard to imagine
where this joint venture is going to go.
They say it's under review.
I think that is just a way of camouflaging
or putting some window dressing on the idea
that they're discussing ways to wind it down completely
and disband it.
Let's run through all the news.
You need to know to keep up in the auto industry.
US auto sales are heading for a rough first quarter
and it's not hard to see why.
March sales are expected to drop 15% compared to last year
when shoppers were rushing to beat
President Trump's tariffs.
First quarter sales overall could fall 6.5%.
That's according to Cox Automotive, JD Power,
and Global Data.
The culprits, high prices, the Iran War,
and the end of federal EV tax credits.
We'll have more on this story in a minute
with our own Michael Martinez.
MG Motor is bringing semi-solid state battery technology
to Europe this year.
It will come in its budget-friendly MG4 EV Urban.
MG is flipping the playbook with this model
instead of debuting the tech in a luxury car or SUV.
MG is putting it straight into a mass market vehicle.
The battery uses just 5% liquid electrolyte
compared to 20% in conventional batteries,
making it safer and more durable.
MG says going for volume first solves a key problem.
Being able to afford the volume of materials needed.
It's a strategy that could accelerate cost reductions
and heat up Europe's EV price war.
And some Stellantis workers who have been called back
to the office recently are getting
an unpleasant surprise in the parking lot.
They're getting tickets for driving the wrong brand.
The automaker is enforcing rules that ban competitors'
vehicles from premium parking spots
at its Auburn Hills Michigan headquarters.
To catch, lots for non- Stellantis cars have shrunk
and often fill up.
The Wall Street Journal reports repeat offenders
could have their vehicles immobilized.
Meanwhile, GM and Ford have mostly
dropped these restrictions for office workers.
And those are today's headlines.
You can find more details on all those stories
at autonews.com.
Our own Michael Martinez has been covering
the Q1 auto sales outlook for automotive news.
Mike joins me now to talk more about what's ahead.
Mike, welcome back to Daily Drive.
Thanks, Cole.
So, co-host, what are the biggest hurdles
right now for the market?
Well, how long do you have?
I mean, there's a lot.
But I guess if you had to boil it down quickly,
it would be affordability from any number of angles
we're talking about still rising transaction prices.
You have affordability concerns in terms of gas prices
that are continuing to go up because of the war in Iran.
And you have higher EV prices because of a lack
of federal tax credits that exist anymore.
So, customers are getting pinched
and we're seeing that in terms of the numbers.
It's a really bad comp compared to last year
because this is the time everybody was rushing out
to get their vehicles before the tariffs hit.
So, year to year horrible numbers.
But if you do take 2026 on its own,
still not necessarily that bad.
There is some resilience in the market.
But as Jessica called well at Edmunds put it,
customers aren't really splurging anymore.
They're making much more practical purchases
because of the prices.
So, down numbers, still some resiliency,
maybe not the worst story in the world.
Well, what's the outlook for the rest of the year?
And are there too many factors
that could change in the coming months
to make a solid prediction?
For a question like this,
you sort of have to turn to the experts,
like Edmunds, like Cox Automotive, JD Power,
and they are all holding steady with their projections.
They're calling for sales of around 16 million,
give or take a couple, 100,000.
That's not that bad.
And I know I think JDP's numbers went down
about 100,000 earlier in the year,
but they held steady as of their first quarter update.
But we don't really know.
It's only the end of March beginning of April.
And as we know, a lot's already happened this year.
Who knows how long this conflict
in the Middle East could last?
If it is prolonged and those prices do stay high,
you could see customers staying home
or maybe flocking more to EVs.
So, a lot of unknowns, even with tariffs,
still given the Supreme Court ruling earlier this year
and you never know what Trump's gonna try next
in terms of imposing new levies.
So, a lot still to be determined,
but for now holding steady around 16 million again,
not the worst in the world.
That would be a fairly strong year.
Well, if it's one thing, it's always something else.
Mike, thank you so much for joining me.
Thanks, Kyle.
You can hear more from Mike on our weekend drive edition
of the show, available Saturday morning.
Coming up, our own Hans Grimel talks about
Sony Honda Mobility's decision to cancel
it's a Phila EV program.
That's next on Daily Drive.
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Welcome back to Daily Drive.
I'm Kellen Walker.
Sony Honda Mobility is the latest
to toss out planned EV models
after the loss of federal tax credits
and slowed demand here in the US.
The joint venture canceled its first two
of Fila electric vehicles just months
before the first model was supposed to reach customers
in California.
Automotive news, Asia Editor, Hans Grimell,
spoke with Daily Drive executive producer Jake Near
about what went wrong with the Fila project
and what it signals about the broader challenges
facing automakers trying to crack the EV market.
Jake reached Hans at his home office in Tokyo.
Hans, always great to have you here on Daily Drive.
Thanks again, Jake.
So maybe help me understand my own reaction to this news.
I told myself in my head, I was like,
you shouldn't be surprised by this.
But for some reason, it felt surprising
to read this this morning.
Maybe that it was something I wasn't expecting
to happen now.
Maybe it's the timing of it, but it's interesting
because we've been hearing about a Fila for so long
and they've had these big splashy reveals,
even as recently as just a couple months ago feels like.
You know, makes sense of it, Hans.
Right.
Well, I think the industry and the Honda Watchers
were waiting for this other shoot to drop.
Ever since CEO of Mibe announced earlier this month
that it was canceling the three EVs for the United States
and really pulling back from its EV first kind of approach.
That was a reversal of a Honda's long time strategy
of going completely, doing away with combustion engines
and going completely electric by the 2040.
It was a very advanced, aggressive approach
for a Japanese automaker.
Although at the time it said it was pulling back
from its own EVs, it didn't mention anything
about a Sony Honda mobility.
And so we're waiting, I think most people were expecting
some kind of fallout to happen for that JV as well.
Yeah, and this also has implications for Honda's production,
even here in the US, that the Fila once a Dan
was slated to be built here in the US.
What does that mean in terms of sort of the Honda's strategy,
building where they're selling to sort of steal a term from Toyota?
Well, the Sony Honda mobility was supposed to bring together
kind of these two iconic Japanese brands,
Sony Honda, known worldwide for at least at one time
for their cutting edge technologies
and to kind of bring the best of both worlds together
and rekindle Japan's prowess for things like the Walkman
or the Sony PlayStation or the Honda Civic
or the Acura NSX or something like that.
These are kind of the power plays
that we were kind of imagining to come out of a Fila.
But you know, the car was very expensive.
The entry model was priced at around 90,000.
It eclipsed 100,000 I think in one of the upper trims.
At those prices, I don't think you could expect
big volumes for this.
So although it was going to be made in the United States,
these Fila vehicles, I don't think Honda
was going to be padding out a lot of Honda extra volume.
So the impact to Honda is really under question.
They never really committed to a volume target
for the Fila brand in the first place.
And by all estimates, it was expected
to be rather limited and meager volumes.
Yeah, you write that it's the same market conditions
that led to Honda canceling those three EV models
earlier that led to this.
But as you mentioned, this is a little bit
of a different segment, right?
This is more in the luxury segment.
What does the say about Honda's, is this just a full on retreat
that we shouldn't expect them to change course
in terms of powertrain anytime soon?
Well, I don't think it's a full on retreat.
They're still committed to electric vehicles
in the long run.
They're keeping a couple of electric vehicles still
in the workbench here.
They've got a zero series that they're still
keeping for India and Japan, I believe,
and they still have some smaller EVs
that they're hoping to sell in the Japan market and elsewhere.
But for the US market, this is really kind of,
they don't have any EVs anymore after this.
So it's a full retreat, I would say,
from the US EV market for the time being.
And what we'll see instead is a doubling down
on their hybrid powertrains.
And in fact, they have a new next generation hybrid powertrain
coming out around 2028.
They just have to get to that point in order
to cash in on this new technology.
You mentioned the relationship and the JV
between Honda and Sony now.
They didn't announce anything about dissolving the JV.
So what is the likely outcome of that relationship
and can something be salvaged out of it?
Right.
Well, this was a JV started back in 2022.
And there was a lot of Bally who around it
kind of teased plans for three vehicles.
The Afeela 1, which is a sedan,
and then the next car would be kind of a compact crossover.
And then maybe perhaps a third vehicle,
which would be a larger crossover.
They've announced that they're canceling at least
the first two cars, development of them and sales plans.
So without the cars, it's hard to imagine
where this joint venture is going to go.
They say it's under review.
I think that is just a way of camouflaging
or putting some window dressing on the idea
that they're discussing ways to wind it down completely
and disband it.
How it might limp on into the future
is unclear without the cars.
Perhaps Sony could, they could keep this joint venture alive
and Sony could contribute its infotainment technology
or its sensors or something to a new software system
that Honda can use in its hybrids
or are using its other cars.
That's a, I can imagine that is one possibility.
So still kind of taking something from Sony's contribution
and using it in Honda's non EV vehicles.
You mentioned in your piece that dealers were very critical
of Afeela for many reasons.
What has been their reaction to this news?
Well, I think the dealers are quite happy about this pullback
of Afeela and the cancellation at least
and for the time being in the United States.
It looks like this will be a long-term permanent decision
and that would be, I think, fine with them.
The dealer association sued the companies in California
saying that Honda's a factory decision to go with Sony
and sell cars puts them in direct competition
with the existing Honda dealers
and therefore violates the franchise law.
So they had that lawsuit already on the books.
What happens to that next?
I don't know, but this Afeela brand
was no a friend of the Honda dealer.
I'm also wondering about the status of electrification
from Japanese automakers generally speaking.
It does seem now that the early adopters,
the Nissan's, the Honda, I guess Honda counts
as at least a more gong-ho about the electrification future.
And then Toyota was sort of the laggard
as many people criticized them if they were pro EV.
So now it seems like the tables have turned almost completely,
that Toyota is actually expanding their EV lineup
where these other automakers are essentially retreating
at least like you said in the US.
Well, you're right.
Toyota is taking really took its multi-path way
approach to heart.
That's been its guiding principle or north star
for its powertrain strategy.
It never says it's anti-EV or against EVs,
but it sees EVs as just one piece of its puzzle, powertrain puzzle.
And it was laid in putting that piece
into the overall chigsaw puzzle, if you will.
But now that it has that piece ready
and is putting it into the puzzle,
it has a full offering of all different kinds of powertrains
to be able to switch flexibly back and forth.
And now we're seeing it being able to dial up EVs
when it wants to.
Of course, it's prime money maker or golden cow
here is the hybrid technology
and that's not going away anywhere soon.
But unlike a lot of automakers that put all of its eggs
into the EV basket, Toyota remains a little bit spread out
and stable with different assets and different places.
Hans Grimel is Asia Editor for us at Automotive News.
Hans, as always, great reporting.
Thank you so much for joining us.
Thanks a lot, Jake.
Have a good day.
That's Daily Drive for Today.
I'm Kellen Walker.
Thanks to Automotive News journalist Michael Martinez
and Nick Bunkley for their reporting for today's podcast.
We also had reporting from William Boston
of our sibling publication Automotive News Europe.
You can get the latest news on electric vehicles,
US sales trends, and everything happening
in the auto industry at autonews.com.
Come back tomorrow for a conversation
with Jake Gunnan of French Way about its voice
of the technician survey.
We found that there wasn't a lot of good data
around how many schools were out there
with automotive programs and even going state by state.
It was a little concerning that we just have no idea
what the education system is putting out.
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