The Quiet 'Convergence' That's Transforming the Auto Industry

An interesting phenomenon is underway. In America—unlike the rest of the world—EV sales are expected to slow down without tax credits and fuel economy regulations.

Yet demand for autonomous driving assistance systems (ADAS) is on the rise.

A recent AutoPacific study said 43% of new car shoppers want hands-free highway driving, like GM’s Super Cruise, Tesla Autopilot, Ford’s BlueCruise and Rivian’s Enhanced Highway Assist.

For Ford and GM, those systems also come on gas cars. But according to many experts I’ve spoken to, when you consider the power demands, onboard computing needs and over-the-air software updates needed for autonomy, EVs are the better option.

That’s for consumer cars. The prevailing trend in commercial robotaxi fleets is a shift toward EVs for efficiency, sustainability, and lower operating costs.

Earlier this week, I wrote a story for The Atlantic about why carmakers are suddenly so crazy about robotics: not just Tesla but Rivian, General Motors, China’s Xpeng and others.

Recent advancements in computing power, processors and AI are helping to drive this autonomous driving boom. So why not go to the next logical step and build robots?

Some, like Tesla and Xpeng, see humanoid robots as a consumer product capable of potentially infinite tasks. Others, like BMW and Mercedes-Benz, see them as a supplement or replacement for human factory labor.

That’s seen as necessary to compete with China’s super-low labor costs. Meanwhile, others are looking to non-humanoid forms for robots.

Xpeng presents a good example of the convergence at work: the robots are said to use the same AI system and in-house chips as their driverless cars.

And they’re supposedly powered by solid-state batteries, which countless companies are chasing for EVs, too.

On a long enough timeline? Maybe.

“The vehicle is the most productive robot you will probably ever have,” GM’s Chief Product Officer, Sterling Anderson, told me recently. “Most robots can't move you places at 75 miles an hour or pick you up across town.”

Of robots and AVs, he added: “They both operate in the same worlds. They both have to track and predict the same kinds of things.”

Anderson, who has a Ph.D. in robotics from MIT and co-founded the autonomous trucking startup Aurora, is objectively smarter than I am.

He disagreed with my theory that EVs inherently make for better AV platforms. “EVs have been opportune historically, mostly because they are on newer electrical architectures” to power advanced sensors and computers.

“You can put the same computing capability in an ICE vehicle versus an EV, or an 80,000-pound diesel truck, for that matter,” he said. Aurora certainly did.

“An EV is a better car, a better experience,” Anderson added. “But there’s a lot of people who are going to want ICE cars that we're going to put AV [tech] on as well.”

But he and others agreed that EVs are a better overall use case for AV ride-hail vehicles. “There’s no range anxiety there,” he said.

All of these converging technologies represent massive investments. Take Volkswagen: it’s putting up $1.8 billion by 2030 just for AI. Now add in what VW’s also spent on EVs, batteries and AVs.

However, the road to robotics is tough—especially for humanoids. Replicating the dextrous human hand is incredibly difficult.

And that’s at a time when many OEMs are still struggling to make good electric cars, let alone robots.

Back to my original question: do people actually want all of this? Or do they simply not know what they want until they see it?

The American affordability crisis doesn’t feel compatible with the rise in car prices and subscription services. Most people just want a good, dependable, affordable way to get the kids to school—not an AI-powered robot.

The auto industry has consistently struggled with its promises for the future. Even more so with getting buyers on board with that future.

But the convergence is real. This is where the investments are going, especially long-term.

As with EVs, China has a strong lead on many of these technologies. Western automakers and tech companies have to keep up.

Even if America’s going back to gas in the short term, I haven’t spoken to many industry luminaries who think that’s a long-term solution.

And when we’re talking about AI and autonomy, we can’t yet imagine where things will go next.

“I want to restore the company’s dignity globally. I want Ford to be the most respected industrial company in the country." Ford CEO Jim Farley on what’s at stake in the tech race with China. [The Office Hours Podcast]

EV and battery plant investments were supposed to bring jobs to GOP districts. Under Trump, they’re all going away. [The Detroit News]

From veteran reporter John Voelcker: When will the U.S. finally get its own $15,000 EVs? I’d add—when does it get $15,000 cars again, period? [Wired]

Speaking of: the era of the super-expensive EV is over. People want deals now, and who can blame them? [New York Times]

Toyota’s recent boost in investments in the U.S. includes $912 million to build more hybrids here, including the hybrid Corolla. [Toyota Newsroom]

Stellantis takes another shot at the U.S. EV market with the new Jeep Recon, which only gets 250 miles of range but has removable doors. [Car and Driver]

Toyota will reportedly stretch its models from seven years on sale to nine, while keeping things fresh via software updates. But Toyota’s software prowess requires a big upgrade of its own first. [Nikkei Asia]

EVs are about to take over used car lots. Will those buyers trade in for new electric models, and will this mean another boom for used EV deal-seekers? [Autoblog]

Ford dealers are now selling certified pre-owned EVs on Amazon Autos. The prices and warranties seem solid; will people shop Amazon for cars? [InsideEVs]

South America’s EV market is booming, and a new Peru megaport is bringing in waves of Chinese cars. Who can compete? [Reuters]

California is reconsidering its plan to phase out gasoline cars by 2035, citing concerns over charging access and EV sales growth. What would that mean for the entire space? [Axios]

Ionna plans to invest $250 million in California charging through 2029. [InsideEVs]

Maryland is kicking off an aggressive EV charger inspection program to crack down on non-functional plugs. But not everyone’s happy about it. [Maryland Matters]

Wisconsin is next to get at least two dozen DC fast-charging sites after federal funding was unfrozen in a lawsuit. [Milwaukee Journal-Sentinel]

Polestar is entering the bi-directional charging space, launching a vehicle-to-home (V2H) service to Polestar 3 owners in California. [Polestar]

The previously Shell-owned Volta Network, whose EV chargers with huge video ad screens you’ve probably seen at malls, has been acquired by Jolt. [The EV Report]

Data company Recurrent has good news for anyone worried about EV battery replacements: they’re not that common or necessary anymore. [InsideEVs]

In 2005, China only had two EV battery manufacturers. Twenty years later, it produces more than three-quarters of the world's lithium-ion cells. Here’s how that happened. [BBC]

Panasonic Energy's Kansas factory is a battery powerhouse. It’s also a major regional economic boost with 4,000 direct jobs and home-grown EV supply chains. [EV Magazine]

Sodium-ion batteries have landed in America. Now comes the hard part. [InsideEVs]

Another week, another set of big moves from Waymo. The Google-owned autonomous taxi service is coming to Miami, Dallas, Houston, San Antonio, Orlando, Minneapolis, Tampa and New Orleans. [Waymo]

Waymo currently uses Jaguar I-Paces, but they’re getting old. It plans to launch Hyundai Ioniq 5 taxis soon, and those have begun testing. [InsideEVs]

Waymo’s latest data: It’s up to 1 million paid rides per month in California alone, which means 26x growth in two years. [The Driverless Digest]

Meanwhile, Tesla isn’t standing still. It just got a permit for its Robotaxi service in Arizona. [Reuters]

Tesla is getting better about reporting its Full Self-Driving crash data, but experts say the data is still misleading. [The Verge]

But here’s a reminder that Tesla still can’t sell the steering-wheel-free Cybercab in its current configuration. [Forbes]

But keep an eye on the Chinese players too. Nvidia-backed WeRide will launch soon on Uber’s platform in Abu Dhabi. WeRide plans to grow its Middle East fleet to 1,000 robotaxis. [Just Auto]

As I’ve covered here before, the rise of autonomous taxis has huge implications for people who drive for a living. In China, that trend is moving even more quickly. [Financial Times]

The AI boom is having an unintended consequence for the auto industry: a new semiconductor shortage as suppliers rush to provide high-end chips to Nvidia and others. [Reuters]

Elon Musk’s xAI, which may get an investment from Tesla if shareholders approve it, is in talks to raise $15 billion for a $230 billion valuation. [WSJ]

Here’s how AI might transform the dealership experience. [Cox Automotive]

Chinese automaker Xpeng has huge plans for its in-house AI system, and Volkswagen is the first partner lined up to use it. [Motor Trend]