Good morning! It’s Friday, January 3, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Elon Musk Definitely ‘Not Going To Be President’
Donald Trump’s return to the White House will be complete in a few short weeks when the convicted felon will be sworn in as the next president of the United States. When that happens, there’s one man who’s sure to be standing by the new president’s side: Tesla boss Elon Musk.
The billionaire stuck with Trump on the campaign trail, donated millions of dollars to support his re-election and has even convinced the “Home Alone 2” actor to invent a whole new department for him to lead. Now, Trump says he will be the one leading the country in 17 days as he sets out to quash any fears that he’s acting on the whim of Musk.
Trump has repeatedly faced questions over Musk’s influence on his decisions leading up to inauguration, reports Furturism, and concerns about how much time the pair have been spending together have also surfaced. No matter how much money Musk throws at the campaign or how many government shutdowns he attempts to force, Trump has said that the Tesla boss is definitely “not going to be president” in a few weeks:
During an appearance on Sunday at Turning Point USA’s AmericaFest conference in Phoenix, the Republican president-elect mocked the idea that he’s “ceded the presidency” to Musk as just the latest “hoax” that his opponents are trying to smear him with.
“No, he’s not taking the presidency,” Trump told his audience of supporters.
Moments later, he doubled down with a smug-sounding jab at Musk about his birthplace — with perhaps a little too much zest.
“No, he’s not going to be president, that I can tell you,” Trump repeated. “And I’m safe. You know why he can’t be? He wasn’t born in this country,” he added, giggling.
Trump’s words haven’t convinced everyone, however, especially as they came just days after Musk effectively ordered Republicans to stop a bipartisan spending bill that would prevent a government shutdown.
What’s more, Musk is now reportedly spending most of his time at Trump’s Mar-A-Lago resort, where he is held up in a cottage on the site whispering in the incoming president’s ear at every opportunity. Will he soon be offered up a spare room at the White House when Trump is handed the keys, or is this the first step in Trump’s push back on his influence? Only time will tell.
2nd Gear: Rush To Make The Most Of Tax Breaks Boosts EV Sales
When Trump does take office on January 20, he’s promised to slash support for electric vehicles and the infrastructure that powers them. This could mean an impending end to the $7,500 tax break available for EV buyers under the Inflation Reduction Act, but new sales data shows that the tax cut won’t be going quietly.
Instead, a rush of EV buyers hoping to make the most of the current support helped bolster U.S. car sales at the end of 2024, reports Bloomberg. Sales of new EVs were up by double digits towards the end of last year, helping car sales grow to around 15.9 million by the end of 2024:
EV sales grew 12% in the fourth quarter of 2024, pushing the full-year total to a record 1.3 million, according to forecasts from researcher Cox Automotive. That’s up from an 8% growth rate in the previous quarter. Plug-in models make up around 8% of the overall US car market, only slightly more than a year ago.
A strong fourth quarter also helped push total car sales up from the year prior. The annualized rate for 2024 rose to 15.9 million cars, based on the average forecast of four researchers, up from 15.5 million a year ago.
This EV surge isn’t expected to last into 2025. The results of the US presidential election encouraged buyers holding out for deals to make purchases before policy changes championed by Trump make electric options even more expensive next year.
The results of the election could still sway EV sales into the new year, with Bloomberg reporting that fewer people are now considering purchasing an electric car going forward. The site reports that just a quarter of new car shoppers are considering a battery-powered model, which is down by two percent points compared with the same period last year.
With the American auto industry plowing big bucks into its electrification efforts over recent years, could the Trump administration’s stance on EVs come back to bite the industry in the months to come?
3rd Gear: Carvana Might Not Be So Hot Right Now
One of the great miracles in recent years has been the turnaround of car dealer Carvana. In 2022, the online retailer had a pretty atrocious year that included mounting losses, poor customer reviews and even a ban on selling cars in some states. Over the ensuing years, however, the losses have dwindled, sales have risen and the retailer appears to be bouncing back.
This recovery could all be a bit too good to be true, if one financial research firm is to be believed, reports Automotive News. Hindenburg Research, which previously exposed financial irregularities at automotive startup Nikola, has called Carvana’s accounting and underwriting practices into question:
In its report, Hindenburg, a forensic financial research firm, alleged Carvana made $800 million in loan sales to a “suspected undisclosed related party” and that “accounting manipulation and lax underwriting” have fueled temporary reported income growth at the company.
Hindenburg analyzes equity, credit and derivatives and finds what it alleges are corporate wrongdoing and places bets against the companies. It was founded in 2017 by Nathan Anderson.
“Our research, including extensive document review and 49 interviews with industry experts, former Carvana employees, competitors and related parties of the company, undertaken over the course of four months, shows Carvana’s turnaround is a mirage,” Hindenburg alleged in its report.
As you’d expect, Carvana has refuted the report, and shared a statement that said the findings of Hindenburg were “intentionally misleading.” As the company said in a statement:
“In the 7 years since our IPO, Carvana has been one of the most heavily researched public companies. The arguments in today’s report are intentionally misleading and inaccurate and have already been made numerous times by other short sellers seeking to benefit from a decline in our stock price. We plan to stay focused on executing our plan for another great year in 2025.”
This isn’t the first time that Hindenburg has uncovered irregularities in the automotive world. In 2021, the company accused startup EV maker Lordstown Motors of not being truthful with investors. By June 2023, the company had folded.
4th Gear: Boeing The Biggest Loser In 2024
After Tesla claimed the title of most recalled car brand in 2024 and saw its sales drop for the first time in a decade, you could be forgiven for thinking that it was the company to fare the worst in 2024. That might have been true, had it not been for Boeing’s awful year.
The planemaker had an atrocious 2024 that started when a door plug flew out a plane mid-flight, saw it become a convicted felon and included countless accusations of quality control shortcomings. Now, the American company has been branded the biggest loser of 2024, as Reuters reports:
U.S. planemaker Boeing is on track to be the biggest loser of 2024 in the Dow Jones Index, tumbling 32% as it bounced from one crisis to another.
Rival Airbus rose more than 11% for the year, and the benchmark S&P 500 gained more than 23% during 2024.
Boeing’s shares opened the year at $257.50. However, a mid-air cabin panel blowout on Jan. 5 aboard a recently-delivered 737 MAX operated by Alaska Airlines triggered investigations and a temporary grounding of the popular single-aisle airplane.
Shares in Boeing have plummeted as it struggled through 2024. The company had a production cap enforced this year while it pledged to clean up its quality control, however supply chain issues also meant it couldn’t even build enough aircraft to hit that limit.
What’s more, the company’s space program fared equally bad in 2024, after its flagship Starliner space craft failed during a flight to the International Space Station and left two astronauts stranded in orbit. Boeing will be one company hoping for better fortunes this new year.
