Advertisement
Canada markets open in 1 hour 25 minutes
  • S&P/TSX

    22,346.76
    -121.40 (-0.54%)
     
  • S&P 500

    5,307.01
    -14.40 (-0.27%)
     
  • DOW

    39,671.04
    -201.95 (-0.51%)
     
  • CAD/USD

    0.7318
    +0.0012 (+0.17%)
     
  • CRUDE OIL

    78.01
    +0.44 (+0.57%)
     
  • Bitcoin CAD

    95,630.22
    +138.48 (+0.15%)
     
  • CMC Crypto 200

    1,507.92
    +5.26 (+0.35%)
     
  • GOLD FUTURES

    2,369.10
    -23.80 (-0.99%)
     
  • RUSSELL 2000

    2,081.71
    -16.65 (-0.79%)
     
  • 10-Yr Bond

    4.4340
    +0.0200 (+0.45%)
     
  • NASDAQ futures

    18,988.75
    +202.00 (+1.08%)
     
  • VOLATILITY

    11.60
    -0.69 (-5.61%)
     
  • FTSE

    8,366.42
    -3.91 (-0.05%)
     
  • NIKKEI 225

    39,103.22
    +486.12 (+1.26%)
     
  • CAD/EUR

    0.6740
    -0.0005 (-0.07%)
     

NY International Auto Show: What top automakers are saying

This week, automakers from around the world descended on New York City for the 2024 New York International Auto Show. From the latest models to the newest technology, Yahoo Finance's Pras Subramanian spoke with top executives from the likes of Nissan (NSANY) and Polestar (PSNY) about what buyers can expect for the months and years to come.

Key video moments:

00:00:10 The latest on the Camry and the EV transition from Executive Vice President of Toyota Motor North America Jack Hollis (TM)

00:08:32 Polestar CEO Thomas Ingenlath talks the Polestar 3 and Polestar 4

00:13:00 Nissan Americas Chairman Jérémie Papin on what sets the newest Kicks apart

ADVERTISEMENT

00:18:24 Kia K4 makes its debut. Kia America COO Steve Center explains why it's so special to Kia (000270.KS)

Editor's note: This article was written by Stephanie Mikulich

Video Transcript

PRAS SUBRAMANIAN: It was a jam-packed weekend, Yahoo Finance. I'm Pras Subramanian here at the New York International Auto Show. Here's a look at some highlights.

[AUDIO LOGO]

We're at the Auto Show end of the day here almost at the Toyota stand. I would say that the automakers, that the Japanese automakers and the Korean automakers are making a lot of headway here recently, a lot of new models, different powertrains, and that's really important for Toyota in particular. They really are pushing forward with the alternative powertrains like hybrids, even stuff like natural gas and things like that.

But, for the most part, they want to really kind of give you more options. They say the consumer wants choice. And I spoke to Toyota EVP Jack Hollis. He's also head of Motor Sales there too. And he was talking about how the consumer really wants choice, and one of those things is for hybrids. Here's what he had to say.

JACK HOLLIS: Well, Camry has been so good. We've stayed committed to the sedan market having a new Camry come out 22 years in a row, best-selling sedan in America. And it's fun to bring it out. The highlight of it is it's 100% hybrid.

And so I think what people don't really realize in the Camry of how successful it's been, we've always stayed ahead of the curve on whatever powertrain, whatever we're doing. So to bring that in 100% hybrid, that's a big deal. Adding the hybrid to Tacoma, another place-- again, it's electrifying our entire lineup. Then we come right back. We got some other ones still coming. Land Cruiser is not too far behind.

And I think it's fun for our dealers to get excited about the next new product. But what's great is we've had a nice cadence. It's not all at one time. It's been spaced out over the last several years, and we're really encouraged where we're going.

PRAS SUBRAMANIAN: Well kind of rounding out that product portfolio. Last year, you guys had a pretty good year here in the US. Those kind of supply chain crunches were over but also rolling out those new products. And, you know, Toyota famously didn't go too hard in EVs, right.

They kind of took their time. They spoke about what customers wanted. And where do you kind of see that right now? Do you think that was the right move at this point?

JACK HOLLIS: Yeah, and here's the reason why it was the right move. The way to find out what you need to sell-- I'm sorry that it's so simple-- is what is it the customer is asking for? What is it that our dealers are asking for? And give it to them.

What we are hearing is that they want our EVs as an option. And the big question really becomes then, what's the right percentages? Some people want a gas engine, and some people want a hybrid, and some people want a plug-in, and some people want an electric, but some people want a hydrogen. How are we giving that to the marketplace? So we're going to continue down that path of just listening to what that customer wants, and then provide to them to the best of our ability.

PRAS SUBRAMANIAN: So as an example the new Tacoma.

JACK HOLLIS: Yeah.

PRAS SUBRAMANIAN: That is a big, big seller for you, guys. Now I believe it's going to be fully hybridized. Is that correct?

JACK HOLLIS: Not fully. So we'll still have the gas engine. We'll have the hybrid option. It's our--

PRAS SUBRAMANIAN: As a hybrid power.

JACK HOLLIS: Yeah, correct.

PRAS SUBRAMANIAN: Right, right.

JACK HOLLIS: i-FORCE MAX, it's kind of like with Tundra. Same kind of idea. You have both options for you. But it's again, it's showing where we're seeing customers. We have a certain base who are saying, I want this. And another base is saying, I want that. We're giving it to them both.

PRAS SUBRAMANIAN: And also a more efficient way.

JACK HOLLIS: Absolutely.

PRAS SUBRAMANIAN: Speaking of efficiency, recently, in the US, they just sort of changed some of the Biden White House EV transition rules making it a bit easier for bigger manufacturers to build more cars like hybrids as opposed to going fully, fully EVs by, let's say, 2030. Those conditions beyond emissions and things like that have been loosened for a bit longer.

From Toyota's standpoint, I know Toyota and also the industry were sort of asking for a bit more time to have that transition in place. Does that mean that we're not going to go fully EV anytime soon?

JACK HOLLIS: Well, there's several things there if you don't-- well, because one part of it is, what's the question we're trying to answer with EVs? Are we trying to sell as many EVs as possible? Well, I don't know. What's the question? The question really that we at Toyota continue to ask is, how do we reduce carbon emissions as fast as possible, everywhere possible with everybody participating?

So our goal is to have everybody globally to participate in reducing carbon emissions. Does that mean EV is the answer? Well, some people in government has said, it is. We're saying it's a answer if we want to do it faster, if we want to have everybody included.

And so there's a lot of pieces there. The EV itself is a very high transaction price. Not everybody can pay that, or infrastructure not everybody can even have it in their home because they're living in an apartment, or there's-- we can go on and on. What if you're in the cold states, and how does cold affect the EV?

So it is part of the solution. And so Toyota itself we're all in on electrification, meaning choice of hybrid, plug-in-hybrid, EV, and hydrogen to solve that question. The issue that becomes is, what's the question, or what's the solution to the Biden administration's their concerns?

And right now, they're saying, well, it's EV. Because if you think about it, even though the EPA has changed last week, 2032 hasn't changed.

PRAS SUBRAMANIAN: Right Not that far-- not the long way.

JACK HOLLIS: It's not that-- It was. It's a short time if you consider it a fact that in the last 10 years, we've gone from 0% to 8% of the market.

PRAS SUBRAMANIAN: Full EVs, yeah.

JACK HOLLIS: Full EVs. So full EVs have gone to 8% of the market. Now, from 24 to 8 more years, so that was 10 years to get to there. The next eight years, we want to go to 67%. That's 10 years to get to 8%. Some of those math is very difficult, but we want to do is if you can use all of electrification to solve the consumer's desire to participate in reducing climate, now we can get somewhere. We just think 2032 is a little too short term, and we have to go a little bit longer so that the customer can come with us on that journey.

PRAS SUBRAMANIAN: So do you think that the hybrids, the plug-ins, mild hybrids, can they get us to where we need to be from a CO2 emissions point of view?

JACK HOLLIS: Absolutely

PRAS SUBRAMANIAN: By 2032?

JACK HOLLIS: Absolutely. Absolutely. And I think one of the elements is that we have to remember-- and I've shared this a couple of times. Sorry, if we've said it before-- but the amount of the minerals needed we have to think about is our precious metals or limited resources.

And one BEV if you use the same amount of resources, I can build you six plug-in hybrids, reducing significant amount of CO2 and costing about $6,000 to $8,000 grand less per vehicle. Or I can give you that same material that one or that six, and I can build you 90 hybrids at another $6,000 and so much more affordable.

So the issue is in each one of these they're reducing carbon very quickly, but I'm getting more participation. And I think it's important to understand we need everybody to participate if we're going to really make a difference. If it's just EVs, if you look at it, it's only 8%.

How much is that really reducing when a majority of the people buying the EVs right now are buying it as an extra vehicle in their fleet? So there's a lot of pieces to this. That's why we think taking a little longer time to get to that goal will allow all of us to participate.

PRAS SUBRAMANIAN: Yeah, we're not just talking about-- we're talking about passenger cars. I'm not talking about trucks and freight and things like. That's another story. But big picture for Toyota in the US, how do you view the US market right now?

People thought that the market would sort of come down a bit. We might have a recession, but that's not happening right now. People are a bit more-- consumer confidence is higher. What are you guys seeing from your customers point of view? Are they still going to the dealerships and buying cars and trucks?

JACK HOLLIS: So there's an industry answer and a Toyota answer. I'll start with your Toyota answer. From a Toyota answer standpoint, is we still have demand greater than supply. Now, while we've handled all the supply chain issues, we're still seeing a significant demand for our vehicles. And like we just talked about earlier, we have a lot of new products, so there's a lot of pent-up demand still.

So you're going to see from a Toyota standpoint of continuing to have a very flat ground stock. We're not growing our ground stock because we're selling as many as we can build. So we're in a good place. Well, what does that say about the industry?

The industry itself is also going to see a little bit of growth this year. We're going to probably get real close to a 16 million market, assuming that's the case. And I still think it might even be over that. And I don't know so much of its consumer confidence as it is more of a pent-up demand.

And the reason I say that is the average age of a vehicle now is over 12.5 years old. It's the oldest fleet in the history of the US.

PRAS SUBRAMANIAN: It's unbelievable, right?

JACK HOLLIS: So at what point people are saying, it's time I have to go buy a vehicle? We're still seeing that play in some of the dragged on-- you talk about long COVID, this is kind of long demand from COVID. And I still think that's really healthy for the industry.

PRAS SUBRAMANIAN: And that was Jack Hollis, Toyota global EVP and head of Toyota Motor Sales.

[AUDIO LOGO]

Earlier, I spoke to Polestar CEO Thomas Ingenlath. Here's what he had to say. The North American debut of the Polestar 4 and, of course, the Polestar 3 going on sale soon. Talk to me about this car, Thomas. Why is it so important to the brand?

THOMAS INGENLATH: Yeah, indeed Polestar 3 is so important because it's an SUV. We were, of course, waiting for having an SUV to SUV in our portfolio. It's as well very much the heart of the company, the premium performance. We had now journalists driving the car, and they just simply write how much that is a surprise how a big SUV as it is can drive so sporty. That's exactly what our brand is about, bringing that joy and fun of driving of an electric car to that premium segment.

PRAS SUBRAMANIAN: Right. This electric design, almost, too. Also with the Polestar 4 with that kind of swept back design. Everyone's heard about the no rear window, things like that, but it's very cool. What are customers telling you about the Polestar 3 and the Polestar 4? Is there a sort of high demand there for these vehicles?

THOMAS INGENLATH: Well, to start with, everybody is, of course, complimenting us for the design, which I like a lot, because yes, it's core part of our company to have that great, cool Scandinavian look. Of course, electric cars can be giving you so much space inside. Both cars have an incredible second row comfort.

They have really cool tech in there. I mean, Google, Android system in our car. The [? guest ?] system is in both cars. A great benefit for the customers. And, of course, range. I mean, we had done great steps in the past now. These cars with both of them over 100 kilowatt hours batteries, of course, give you a big, big comfort in terms of range.

PRAS SUBRAMANIAN: So before we talk about the bigger picture of the EV space, I want to talk to you about Baltimore and the situation there with the port. I know a lot of automakers use that port as a way of entry for a lot of their vehicles and parts. Is that affecting Polestar currently at the moment?

THOMAS INGENLATH: Currently not. I've checked it this morning. We are actually, right now, as far as I've seen not affected in the deliveries, which are happening in the coming months. So thank God so far not.

PRAS SUBRAMANIAN: So kind of recapping here, Polestar 3 coming to customers in Q2. We're going to see Polestar 4 later today. And also customers can sort of, I guess, place orders for that eventually sooner rather than later. Look, two SUVs in the market plus the Polestar 2 existing currently here. Big picture-wise, do you think that the way things are kind of going with EVs in America, there's a bit of an enthusiasm kind of waning a bit from a demand point of view?

Do you think it's kind of more preferable to be in the upper end, the more of the luxury end of the space where demand is a bit more inelastic? Is that where Polestar's position is? Is that where you guys want to be?

THOMAS INGENLATH: That's exactly where we are aiming with these cars, and where we believe as well. You know, what's crucial is what type of desirability brings a car to the table, how technology-wise advanced. That's what our customers are searching for.

And for us, actually, it doesn't make a difference who are we competing with. Is it a combustion engine car? Is it the electric car? We are in that performance premium segment out to convince with the greatness of our products.

PRAS SUBRAMANIAN: So real quick, we have, obviously Polestar is in the global markets, China, Europe, and also America. But in the US, how is that market shaping up for you guys, for Polestar right now?

THOMAS INGENLATH: Well, we have definitely that journey where US, especially with the production of Polestar 3 in South Carolina will become more and more important in our business. The aim is to reach a percentage of all of our 30% of sales for Polestar happening in the US. At the moment, the majority, of course, is Europe. That's where we were born, where we are strong, but it will shift, especially with Polestar 3, of course, a larger extent to the US.

PRAS SUBRAMANIAN: So in the States, at least, we're seeing more Polestar 3s here potentially in Q2. And also production of the Polestar 3 happening, I think, later next year, if I'm not mistaken.

THOMAS INGENLATH: No, no. Already in 2024 by summer, we will shift production to South Carolina. We're very excited about that.

PRAS SUBRAMANIAN: Oh, well, that's good to hear. I guess I was mistaken. I'm glad. Thomas, thanks so much for joining us. And I appreciate that clarification about where the car will be built. And now here's my interview with Jeremy Papin, Nissan Americas chairman and Nissan USA CEO. Let's talk about the Kicks, an important car for the brand, what's going to set it apart do you think in the market?

JEREMIE PAPIN: I think just I look at this amazing design, right? I mean, that's the key attraction when you see it. Obviously, we've also put more technology in and the connectivity is improved. It's an all-wheel drive. This is the first Kicks that's all-wheel drive, which means all of the northern states, obviously, we have the technology that matters.

And we're bringing in driving assistance capabilities that were not in the first generation Kicks. So I think this one comes with the right level of technology, a great design, and we're still aiming for very attainable price points, which is really what the market wants at the moment. Good miles per gallon, affordable price points, and a lot of technology.

PRAS SUBRAMANIAN: It's noteworthy you mention miles per gallon because we were in the midst of a big EV transition and that sort of-- I don't know if it's on pause. It's sort of slowing here. Nissan has a new sort of strategy with that globally but also in the US, their mid-term plan. How are things changed? I know fewer EVs, more gas powered cars coming up?

JEREMIE PAPIN: I think our policy is to just move-- the market will move with what the consumer wants. So we just want to offer the consumer as much choice as he can, and then they choose the powertrain that's right for them.

And so over the next three years, the company will be launching 30 new cars. In the US, seven. Within those seven, we will have all powertrains. We will have combustion engines. We will have battery EVs, plug-in hybrids, and hybrids.

And so with that breadth of lineup, obviously, the consumer has the choice of deciding at what speed each of one of them wants to move towards electrification. What is true is that consideration for electrification continues to grow satisfaction for those who drive an EV is very high, and so the repeat sale is there. So we see constant growth in EVs coming forward.

PRAS SUBRAMANIAN: I noticed-- I know that globally, I believe, 30 new cars by 2026, 16 of those EVs, which is a bit, I think, fewer than what you guys originally planned for. And also, you want to achieve ICE parity with EVs, or even EV parity with ICE by 2030. Is that achievable? is that a long-term goal that can happen?

JEREMIE PAPIN: I think it's achievable because again, as we start to think again about how to conceive EVs, you just bring simplification in it. You bring greater commonality across many of the models. You have fewer parts per car. And the, you know, the combination of both drives the cost efficiency.

So yeah, we're thinking in the next generation we'll see costs down by 30%. All of this most of it really to the consumers benefit in terms of making sure we live up to our purpose, which is to offer vehicles to as many and as large of a consumer base as we can at Nissan.

PRAS SUBRAMANIAN: Yeah, because the Kicks then also with vehicles like Infinity offering a broader range of products here. Nissan, of course, has big presence in the US, manufacturing presence here. But also you guys ship from abroad. We've seen what happens in Baltimore right now with the port being shut down and with that bridge situation. Is Nissan impacted at all by that Baltimore situation?

JEREMIE PAPIN: First of all, my thoughts go to, you know, obviously, the families, the colleagues, the friends of the victims of this terrible accident. We've been happy users as a business of the Baltimore port. We've redirected ships to other ports on the east side of the country. And I think there will be no interruption to our business in the short term, and we're looking forward to working again out of Baltimore whenever the port will be ready.

PRAS SUBRAMANIAN: So no impact there with what's going on in Baltimore?

JEREMIE PAPIN: No.

PRAS SUBRAMANIAN: But big picture in the Americas or in the US, at least, what is your sort of high-level view of the market, of the broader auto market in this country?

JEREMIE PAPIN: I think the market is fairly strong. It's around 16 million units at a high level. There was pent-up demand. A lot of that has been eaten up by where the interest rates have taken monthly payments. But the industry is solid. Consumer is in need of cars, driving population has expanded, and people who have a driving license want a car. And so we should be positive and optimistic about the market going forward.

We're surely very optimistic about our business because we have so much product announcements. You've mentioned Kicks. You've mentioned the Infinity QX80. Both models coming in to high growth segments of the market, the more entry SUV or the premium market.

We'll have two more very new cars later this year at Nissan, and then another three over the next few years. So a lot of momentum. So we feel, you know, we're confident about the strength of the market, and we're very confident about our market share gains.

PRAS SUBRAMANIAN: So Nissan's optimistic. Other brands have told me the same thing. They're optimistic with what's happening in 2024. High rates, forget about that. They're still selling cars. Jeremie Pepin, thank you so much for joining us.

[AUDIO LOGO]

We're with Kia today right now. The Kia K4 just debuted, just now global debut. Just two different models, a hatchback and a regular car. Joining me now Steve Center, CEO of Kia America. So Steve, talk to us about this K4 here debuted just now. How does it fit into the mix of Kia's portfolio?

STEVEN CENTER: We're very excited about K4. It will eventually become our entry sedan. And sedans are very popular because of their affordability and their size. And the K4 comes in two body styles. This is the four-door. It also comes in a five-door sporty wagon. And we're very excited about that because it's going to attract a lot of young customers to Kia for the first time.

PRAS SUBRAMANIAN: It's interesting because the K4 is not an EV. It's not a hybrid. It's a traditional gas-powered car.

STEVEN CENTER: Right.

PRAS SUBRAMANIAN: But Kia also known for its EV9 that won North American Car of the Year just earlier today. The EV6, which is sporty on a smaller sort of crossover type of vehicle. So Kia kind of doing two different paths here. Is that sort of the strategy for you going forward? Has that changed at all?

STEVEN CENTER: Absolutely. We're still investing in our internal combustion line of cars and are investing to build out our EV line of cars. So where you'll see Kia within the next couple of years is two full lines of cars. So depending on where you are or what you need or what your preferences are, there will be an EV for you, or there'll be an internal combustion for you.

PRAS SUBRAMANIAN: And you kind of envision that dual path going on for years to come?

STEVEN CENTER: For quite some time until the transition is complete whenever that is.

PRAS SUBRAMANIAN: So no real pivot though from, let's say, more EV to back to traditional or vice versa.

STEVEN CENTER: No, and we're still growing. We're growing overall. We're still growing the ICE side. So it gives us a chance to be able to fund all of these projects.

PRAS SUBRAMANIAN: So before we talk about kind of bigger picture stuff with the industry, I want to quickly talk to you about what's happening in Baltimore with the port situation, that awful situation there at the bridge. Some automakers have been impacted by that port closing. What's going on with Kia? I know that Kia, obviously, imports a lot of cars, but they also build in the United States too.

STEVEN CENTER: Yes, we do. We have a factory in West Georgia, and we're building the Hyundai Motor Group Metaplant outside of Savannah. When I saw that on the news, I was absolutely horrified. But we got on the phone and actually, we don't use that port. So it won't affect our business at all.

But in a sense, it's still well because that port is closed until they can clean that up and reopen the waterway. Excuse me. And the other ports are going to have to pick up the load, and we use some of those ports. So you're going to end up with congestion in Newark and other places.

PRAS SUBRAMANIAN: Basically, there's going to be some spillover effects here and there.

STEVEN CENTER: For everybody. Everybody.

PRAS SUBRAMANIAN: So big picture looking at the American auto market, the US auto market, which you're in charge of here or are CEO of. Do you see it growing? Is there a tenuousness on the part of the consumer, or are they from Kia's point of view, still wanting to buy new cars? There's unmet demand there?

STEVEN CENTER: Absolutely. I think a lot of things have changed in the last 12 months. So the supply chain is pretty much recovered. You don't hear about those problems anymore. The manufacturing's caught up. Competitors that were more disproportionately hurt by the supply chain are back, so the market share is starting to rebalance a little bit. So we're trying to hold on to what we gained over the past few years.

The interest rates are a little higher now. Dealers have inventory now, so the over-MSRP pricing has been reduced or eliminated in many cases. So it's a more normal market.

PRAS SUBRAMANIAN: Would you say that Kia's customers have been impacted by these higher rates, these higher for longer rates we've seen?

STEVEN CENTER: Everyone has. And quite frankly, I'm old enough to think that these aren't so high. When I began my career in the automobile business, the interest rates were 21%. So it was pretty crazy then. But they've been very unusual low, historically low for a long time.

So the price of the same car is now more expensive because most people finance the cars by leasing or taking a loan out. And that's troubling for consumers. You had a lot of inflation unrelated to the cars that's eaten up their disposable income. So it's troubling.

PRAS SUBRAMANIAN: You know, at the show today, I've been noticing a lot of the Korean automakers and Japanese automakers really putting a full force of products out here today. And talking about Kia, sister brand Hyundai, and also Genesis, I think a lot of Americans are kind of curious how does that relationship work? Is one market, one sub market or is-- my understanding is Kia kind of covers all of them, right?

STEVEN CENTER: Yeah, we cover everything. We have an interesting relationship where sort of separate companies we've sort of managed separately, but there is some overlap in areas where you can gain efficiency of scale. So in some cases, we're competing directly. In some cases, we don't cover the same segments.

One of the things that we're working to introduce is a line of what we call purpose-built vehicles, which are work vans. And that's a completely new business for us, and we've got them running in range from small to large. And they're electric. And there are a lot of companies like cable TV companies and delivery companies that are just aching for these types of vehicles. So that's all new business for Kia because we're the only ones doing that.

PRAS SUBRAMANIAN: That's all for now from the New York City Auto Show. I'm Pras Subramanian with Yahoo Finance.