• Nissan and Honda confirmed Monday that they're in merger talks.
• Nissan's lack of hybrids has affected the success of popular models like the Rogue.
• Honda has seen big sales increases for popular models with hybrid offerings.

A tie-up between Nissan and Honda could solve one big problem for Nissan: a lack of hybrids.

That's what dealers who spoke with Business Insider said last week amid reports that the Japanese automakers are in talks to create a new global auto goliath. Now, this week, the automakers have confirmed the chatter — saying they're indeed in official merger talks. Mitsubishi Motors also is involved in the talks, the Monday statement from the companies said.

Nissan is one of few car manufacturers in the US without a hybrid or plug-in hybrid offering, despite taking an early lead in EV sales with the Leaf in 2010.

Green car shoppers have turned away from EVs in favor of hybrid models this year, leaving Nissan with unpopular and unprofitable battery-powered offerings in the Leaf and Ariya SUV.

Nissan dealers have dealt with slumping sales all year, particularly for the brand's top seller, the Rogue. Once a segment leader, sales of the Rogue fell 10% through the first nine months of the year compared to the same period last year, according to company data.

And dealers say they're losing customers to Honda and Toyota, which have hybrid versions of their CR-V and RAV4 SUVs.

One dealer with both Nissan and Honda stores says it's "painfully obvious" that Nissan is losing customers to brands with more hybrids. The dealer didn't want to be identified, but Business Insider confirmed his identity.

He said it has become common for a Nissan shopper to migrate to the Honda store after they realize there aren't any hybrids.

Following disappointing sales results in the first quarter, Nissan CEO Makoto Uchida acknowledged the hybrid blind spot, saying during an earnings press conference that until last year, Nissan wasn't able to predict the rapid rise in demand for hybrids. The company has said it is shifting efforts toward hybrid offerings, but dealers and automotive industry experts say that change could take years.

Meanwhile, Honda is riding the hybrid wave this year as customers gravitate toward the hybrid versions of the CR-V SUV and Civic sedan. Just this month, Honda said it has plans to double its global hybrid sales to 1.3 million vehicles by 2030, as it aims to create a "bridge" to EV adoption.

Dealer skepticism over another auto merger

Still, some dealers are wary of yet another global auto merger.

Adam Lee, a dealer in Maine with several major brands, including Nissan, Honda, and Chrylser, said he's grown cynical about promised "synergies" after experiencing several different mergers as a Chrysler dealer.

"Show me a merger where the synergies actually existed, and I'll show you something that doesn't exist," Lee said. "I'm trying to give them the benefit of the doubt, but I tend to be cynical about anything like this."

Chyrsler-owner Stellantis is in the middle of a tough transition right now, as the CEO who led the merger of Fiat Chrysler and PSA stepped down suddenly at the start of the month. Before that, Chrysler lived through a messy marriage with Germany's Daimler in the late 1990s and early 2000s.

Lee said Nissan could probably use some help with hybrids and other plug-in models but argued: "You don't necessarily need to merge to do that."

• The Biden administration on Wednesday approved California's ban on gas cars by 2035.
• Trump has promised to revoke California's authority to set strict limits on tailpipe pollution.
• It's a high-stakes fight over the future of electric vehicles and tackling the climate crisis.

The stage is set for another battle between President-elect Donald Trump and California over the state's aggressive push for electric vehicles that could affect the rest of the country.

The Environmental Protection Agency on Wednesday said California can go ahead with its ban on the sale of new gas-powered cars by 2035. The approval is an attempt to safeguard the state's strict limits on tailpipe pollution from Trump's promise to revoke them and roll back other federal incentives for electric vehicles.

The stakes are high for automakers because what happens in California can dictate companies' broader EV strategies and the pace of the country's shift away from fossil fuels. The state accounts for some 11% of the US auto market and is also the top EV market in the country. In the first half of 2024, EVs and hybrids accounted for nearly 40% of sales in California.

On top of that, 11 other states and Washington D.C. have adopted rules similar to California's as they seek to reduce the country's largest source of greenhouse gas emissions. The rules require automakers to sell a growing number of zero-emissions vehicles over time. In 2026, at least 35% of new cars, pickup trucks, and SUVs must be electric in California and five other states, while other states' targets kick in in 2027.

Automakers largely support easing emissions regulations

While Trump will face legal challenges in trying to roll back California's rules, he could find some automakers on his side.

The Alliance for Automotive Innovation, a lobbying group representing most new vehicle manufacturers in the US, has already asked Trump to ease emissions regulations but keep federal tax incentives that keep EVs affordable.

John Bozzella, president of the alliance, said Wednesday that the waiver was an expected development and the Trump administration will likely revoke it next year.

"We've said the country should have a single, national standard to reduce carbon in transportation," Bozzella said in a statement. "But the question about the general authority of California to establish a vehicle emissions program – and for other states to follow that program – is ultimately something for policymakers and the courts to sort out."

Trump, some Republican lawmakers, and groups linked to fossil fuel interests have repeatedly attacked EVs on the campaign trail, falsely claiming that Americans would be forced to abandon their gas-powered vehicles.

Those attacks come as the EV market deals with a marked slowdown in demand, forcing many companies to reasses their long-term plans for battery-powered cars and, in some cases, add more hybrids to the mix. A pullback in production has made it harder for many companies to meet long-term emissions requirements. Automakers including General Motors, Ford, and Stellantis have laid off thousands of workers.

Auto market analysts, environmental lawyers, and policy experts told Business Insider that they expect the shift to zero-emissions vehicles to continue regardless of who's in the White House — albeit at a slower pace if Trump and Congress overturn tax incentives to buy EVs and investments in charging infrastructure.

"Whatever the Trump administration does this time, automakers' concerns about stability will come up again because all of these manufacturers have said zero-emissions vehicles are the future," Sean Donahue, an attorney who's represented the Environmental Defense Fund in litigation over California's emissions waiver, said.

He added that there's pressure from regulators in other countries to address the climate crisis. US automakers also don't want to fall far behind competitors in countries like China, where affordable EVs have taken off.

California looks to 'Trump-proof' its regulations

Even if Trump does revoke California's emissions waiver, Gov. Gavin Newsom is already trying to "Trump-proof" the state, including its EV and climate policies.

Newsom said he would restore rebates for consumers who buy EVs if Trump ends the federal $7,500 tax credits enacted in the Inflation Reduction Act. This month, the state's energy commission approved a $1.4 billion investment in EV charging and hydrogen fuel stations over the next four years. The commission said the funding could help build nearly 17,000 new public chargers for passenger vehicles — on top of the 152,000 available now.

Newsom also convened a special legislative session to bolster California's defenses against Trump's attacks. Lawmakers could pass $25 million in new funding for the California Department of Justice so the state can file litigation against the Trump administration. That will likely happen if Trump revokes the state's tailpipe pollution waiver.

Karoline Leavitt, a spokeswoman for the Trump transition team, said that Trump plans to stop what he says are attacks on gas-powered cars.

"When he takes office, President Trump will support the auto industry, allowing space for both gas-powered cars AND electric vehicles," she said in an email.

Ann Carlson, a professor of environmental law at the University of California at Los Angeles, told Business Insider that she expects the Trump administration to face an uphill legal battle.

She said the EPA has approved California's authority to set strict rules for tailpipe pollution for decades because the state's air quality is so bad. Otherwise, areas including Los Angeles and the Central Valley wouldn't comply with federal air pollution laws and could be penalized.

"The sanction is the withholding of federal highway funds," Carlson — who recently served as chief counsel to the National Highway Traffic Safety Administration — said. "It's quite draconian. So California has a pretty good argument that it needs these waivers to meet federal law."

The Supreme Court last week agreed to consider a lawsuit that oil and gas producers filed against the EPA over its waivers allowing California to set stricter limits on tailpipe pollution than the federal government. However, SCOTUS will only decide whether fossil fuel makers have standing to sue over what they say is bureaucratic overreach and won't consider whether California's waiver is legal.

James Di Filippo, a principal policy analyst at the research firm Atlas Public Policy, said automakers will likely continue to walk back their EV investments while the legal battles play out. Companies could seek another compromise with California to restore more certainty as they plan new vehicle models for years to come.

"If they're uncertain about a regulatory outcome, they'll default to a less intense push," he said.

• The mood inside Stellantis has shifted dramatically after its CEO resigned on December 1.
• Dealers and employees are encouraged by early moves made by the interim executive committee.
• The automaker's critical relationship with US dealers is on the mend.

The mood inside Stellantis's North American division has changed dramatically since former CEO Carlos Tavares unexpectedly stepped down on December 1.

Dealers and employees of the struggling Jeep owner who spoke with Business Insider say they and many of their peers feel optimistic about how the company has handled these first two weeks.

They point to quick and sweeping changes made by Chairman John Elkann and his advisory committee, who have vowed to rebuild trust with key stakeholders.

So far, this interim executive committee has re-hired a longtime Dodge and Ram executive and reinstated a US sales chief who was shifted into a different role earlier this year, moves that disgruntled dealers immediately celebrated.

Elkann's executive committee, comprised of current and former executives, has taken over the company's leadership while searching for a new CEO, which they hope to hire in the first half of 2025.

The shift in morale happened almost overnight, sources said. Elkann delivered a rousing speech to employees at Stellantis's North American headquarters the day after Tavares stepped down, and change was swift in the days that followed.

During the employee town hall, Elkann emphatically announced the end of Tavares's "Project Darwin," a ruthless cost-cutting initiative that included several waves of buyouts and layoffs, and even, at one point, sending employees tips on how to find a new job outside the company.

Elkann instead reassured employees that Stellantis "will survive," a person who attended the meeting told BI.

Executive shuffles

Longtime Dodge and Ram executive Tim Kuniskis, who retired earlier this year, returned to the company on Monday. He is stepping back into his role as leader of the Ram brand, which builds Stellantis's highly profitable pickup trucks.

Meanwhile, a shuffle in the North American executive team saw Jeff Kommor reinstated as US sales chief, a move lauded by dealers who were frustrated to see him shifted into a commercial sales role earlier this year.

"The changes will enable us to operate in a structure that will drive the best outcomes for the region, unlock significant potential, and win in the market," a Stellantis spokesperson said in a statement. "A critical lever to accomplish that is a dedicated CEO for the Ram brand who is singularly focused on that brand."

According to people briefed on these decisions, Antonio Filosa, CEO of the Jeep brand and newly named Chief Operating Officer, was a key driver of these moves.

By the end of the second week without Tavares, Stellantis shares had risen about 12% in his absence. This is a sign that investors also feel more encouraged by leadership's new direction, including efforts to reign in oversupply and boost sales.

Dealers get back on board

Tavares lost the crucial support of Stellantis's US dealer body earlier this year, and it appears that the company is prioritizing that relationship in the early days of the post-Tavares reorganization.

Kevin Farrish, a Chrysler-Dodge-Jeep-Ram dealer in Virginia who serves as dealer body president, said the group is looking forward to working with the new "powerhouse team" Elkann's executive committee has built. He specifically mentioned Kuniskis and Kommor, as well as Filosa in his new operating officer role and Matt Thompson, who remains as senior vice president of US retail sales.

"That will truly bring us back to our former glory," Farrish told Business Insider. "We needed change, so provided the changes are correct — and they are thus far — it shows their commitment to fix things."

• The Cruise founder Kyle Vogt criticized GM's decision to pull robotaxi funding.
• GM's decision to divest from Cruise comes as other tech giants forge ahead with robotaxi plans.
• Investors have appeared to welcome the news as GM looks to cut costs.

General Motors' decision to pivot away from robotaxis has one big critic: the Cruise founder Kyle Vogt.

Vogt, who resigned from the company in 2023, posted on the social-media platform X following GM's announcement that it would stop funding Cruise and fold it into the company's other driver-assistance efforts: "In case it was unclear before, it is clear now: GM are a bunch of dummies."

Vogt did not immediately respond to an interview request.

GM cited the hefty costs of fleet operation. Since taking control of the startup in 2016, GM has invested more than $10 billion in its development and operation.

The automaker has been trimming costs all year as demand for electric vehicles slows, and the company reckons with a longer road to profitability for these vehicles.

"Cruise was well on its way to a robotaxi business — but when you look at the fact you're deploying a fleet, there's a whole operations piece of doing that," GM CEO Mary Barra said on a conference call, according to CNBC.

Ending investment in Cruise's robotaxi business is the latest blow for the self-driving division. Commercial robotaxi rides have been on pause since October 2023, when one of its cars injured a pedestrian.

Vogt's departure last year came just weeks after the company suspended all autonomous operations. The company has since resumed autonomous-vehicle testing with safety drivers in Arizona and Texas.

The state of the robotaxi business

GM isn't the first legacy car company to scrap autonomous-vehicle funding. In 2022, its rival Ford pulled out of its joint venture with Argo AI.

Meanwhile, Elon Musk's Tesla is all in on robotaxis, and the tech giant Alphabet is barreling forward, with driverless Waymo rides open to consumers in many cities.

Still, some investors seemed to welcome GM's decision to pull Cruise's funding in favor of $2 billion in annual savings, sending GM's stock price up more than 3% in after-hours trading Tuesday. Shares fell more than 4% in trading Wednesday.

"While some bulls may have hoped for external funding to give Cruise a life extension, we strongly believe that most investors did not want to see GM commit more capital to Cruise," Joseph Spak, a UBS analyst, wrote in a note to clients.

• Auto execs see an opportunity to roll back state EV mandates under President-elect Donald Trump.
• Nissan and Toyota say state rules requiring a rapid uptick in EV sales are unrealistic.
• Automakers are facing slowing EV demand, job cuts, and competition from China.

Some auto executives see an opportunity with the incoming Trump administration to roll back state rules requiring a rapid uptick in electric vehicle sales.

Executives at Nissan, Toyota, and the auto industry's largest US lobbying group say it will be impossible for the industry to meet aggressive timelines to phase out gas-powered cars and trucks by 2035 in a dozen states including California and New York, as well as Washington, DC. In six states, a target kicks in in 2026, when at least 35% of new car sales must be EVs.

"It will take a miracle to be achieved," Jérémie Papin, senior vice president of Nissan, said this week during an event in Washington, DC. "That's where others need to do a reality check on what's possible."

He noted that EVs accounted for about 9% of new car sales nationwide in the third quarter — a record, but still far short of what regulators are requiring by 2026.

Automakers, facing lower-than-expected demand for EVs this year, are pulling back on production, and some companies are cutting jobs to save costs. At the same time, they have poured billions of dollars into EVs and executives say they are committed to the transition, especially to stay competitive with China as it churns out more affordable EVs. That balancing act has put the industry in a delicate position with Trump who railed against EVs on the campaign trail, vowing to kill tax credits and other incentives encouraging Americans to buy them.

Now the industry is strategizing how to influence Trump, including on EV sales requirements they view as too ambitious. Trump will likely take their side.

At a campaign event in Michigan in October, he said no state would be allowed to ban gas-powered cars. Trump during his first term tried to revoke California's authority to set stricter limits on tailpipe pollution than the federal government. California is granted that authority under the Clean Air Act but must get waivers from the Environmental Protection Agency. Biden restored the states' authority — a move currently being litigated and could reach the Supreme Court.

To avoid uncertainty, a group of automakers, including BMW, Ford, Honda, and Volkswagen, struck an agreement with California in 2020 to follow the state's rules through 2026.

The rules are stricter than federal regulations issued earlier this year by the Biden administration's EPA. Those federal rules aren't an "EV mandate," as Trump falsely said on the campaign trail. Rather, automakers can choose how to curb greenhouse gas emissions from cars, trucks, SUVs, and vans sold between 2027 and 2032. The agency estimated the rules could boost EVs to up to 56% of new car sales, with the rest from a mix of hybrids and gas vehicles.

'Not ready to go electric'

Dealers, which were the first to sound the alarm on changes in the EV market last year, have argued that state and federal emissions requirements are out of step with demand. As companies push to meet these requirements, dealers complain they are stuck with unpopular EVs on their lots.

"A majority of customers are simply not ready to go electric right now," Dave Kelleher, a Chrysler-Dodge-Jeep-Ram dealer in Pennsylvania, told BI. "Maybe with a new administration, some of those fines will become a thing of the past, or even mitigated."

Karoline Leavitt, spokeswoman for Trump's transition effort, said Trump will stop attacks on gas-powered cars.

"When he takes office, President Trump will support the auto industry, allowing space for both gas-powered cars AND electric vehicles," she said in an email.

John Bozella, president of the Alliance for Automotive Innovation, which represents companies producing nearly all the new vehicles sold in the US, sent a letter to Trump in November asking that he ease emissions regulations but keep EV tax incentives fueling domestic investment in the supply chain.

An analysis commissioned by the Natural Resources Defense Council found that companies have announced $312 billion in planned investments in EVs and battery production since Biden took office in 2021, fueled partly by tax incentives in the Inflation Reduction Act.

One automaker, Toyota, supports doing away with EV mandates and subsidies altogether. In a recent op-ed in the Wall Street Journal, Toyota Chief Operating Officer Jack Hollins wrote that state mandates distort the market because companies funnel zero-emissions vehicles to those locations and ultimately limit choices for customers.

General Motors initially sided with Trump in his crusade against California's EV rules, but dropped its support of the legal battle after Biden won the 2020 election. It's unclear whether the automaker would once again side with Trump if he tries to roll back emissions requirements. Paul Jacobson, General Motors' executive vice president and chief financial officer, told reporters that ideally there'd be more consistency between federal and state rules. But the automaker will respect regulators' authority, he said.

"There's a lot at stake here," Jacobson said during the event in Washington. "That's why we talk about being nimble across the board, because sometimes it's the marketplace and sometimes it might be the regulatory environment. But we can't make excuses for poor performance. It's not just Washington. It's China, it's Europe. There's a lot of things going on all over the world and we have to be able to respond to that."

• Stellantis CEO Carlos Tavares abruptly resigned on Sunday.
• The Jeep-maker's CFO on Wednesday gave one of the first public interviews since the departure.
• He described disagreements between the company's board and the former CEO.

A top Stellantis executive on Wednesday gave an internal peek into CEO Carlos Tavares's abrupt exit.

Doug Ostermann, the Jeep maker's CFO, said at an investor conference that he noticed a divergence between Tavares and the company's board on two key issues: operational priorities and how leaders interacted with key stakeholders like dealers, suppliers, and unions.

Tavares stepped down on Sunday. Ostermann said Tavares and the board couldn't agree on how to run the company through the end of his tenure, previously scheduled to last until early 2026.

Most of the disagreements "related to tactical issues on how to run the business over that kind of short-term time period and what actions should be taken in regard to short-term metrics versus longer-term benefit of the company," Ostermann said in response to a question at a Goldman Sachs conference.

Critics of Tavares have argued that his cost-cutting actions, particularly in the Jeep brand, created a short-term illusion of success while fueling a long-term problem for demand in the critical US market. He cut popular models like the Jeep Cherokee and Renegade, which will now return in 2026.

His decision to step down from the top job at Stellantis came after months of pressure from disgruntled investors, dealers, and union officials.

"We need to build back trust," Ostermann said. "There's a strong desire among the management team today to really work on that — and it'll take time."

On the road to recovery

Parting ways with Tavares was a good first step in rebuilding trust, US dealers and union leaders said.

Dave Kelleher, a Chrysler-Dodge-Jeep-Ram dealer in Pennsylvania, told Business Insider he was encouraged by the company's about-face from its previous commitment to Tavares through his initial contract and saw the CEO's departure as a sign that dealers' concerns were being taken seriously.

"It was clear to me, and to other dealers, that we needed to move on quickly and get this thing on the right track," Kelleher said.

Stellantis's US sales this year through September, the most recent report, were down 17% compared to a year ago. Profit-generators Jeep and Ram posted the biggest volume losses, with Jeep ceding significant market share to competitors like Hyundai in the affordable SUV segment.

Stellantis's US dealers released an open letter to Tavares over the summer, accusing the chief executive of "reckless short-term decision-making" that has had "devastating, yet entirely predictable, consequences in the US market."

UAW President Shawn Fain released a statement this week calling Tavares's exit a "major step in the right direction."

"For weeks, thousands of UAW members at Stellantis have been calling for the company to fire Carlos Tavares due to his reckless mismanagement of the company," Fain said in the statement. "We are pleased to see the company responding to pressure and correcting course."

Fain also said that the union is still committed to holding Stellantis accountable amid planned layoffs the union says violate the 2023 collective bargaining agreement.

"We are looking forward to sitting down with the new CEO, backed up by thousands of UAW Stellantis members ready to take action, and discussing their plan to keep making world-class vehicles here in the United States," Fain said.

• Stellantis CEO Carlos Tavares's resignation comes after months of pressure.
• The global auto giant is in turmoil amid poor financial performance in 2024.
• Tavares leaves the company locked in legal battles with investors and union workers.

Carlos Tavares tendered his resignation from the top job at global automaker Stellantis over the weekend after a year of mounting pressure to turnaround falling sales and shrinking margins.

Dealers had accused him in September of mismanaging valuable brands that helped lead to the slowdown and a a slew of executive departures.

In October, Stellantis — originally formed by a 2021 mega-merger of Fiat Chrysler Automobiles and France's PSA — said Tavares would stay through the end of his contract in 2026. But by Sunday, things had clearly changed.

Tavares, a former protégé of Nissan's notorious Carlos Ghosn, is well known in the industry for his corporate frugality. His initial cost-cutting actions helped to deliver two years of profitability. But he'll leave the company in a state of disarray, particularly in the critical North American market.

Stalling sales in North America

Stellantis's US sales through September, the most recent report, were down 17% compared to a year ago. Profit-generators Jeep and Ram posted the biggest volume losses, with Jeep ceding significant market share to competitors like Hyundai in the affordable-SUV segment.

Critics of Tavares have argued that his cost cutting actions, particularly in the Jeep brand, created a short-term illusion of success while creating a long-term problem for demand in the critical US market.

Dealers in September accused Tavares of "reckless short-term decision-making" that has had "devastating, yet entirely predictable, consequences in the US market."

Stellantis has reversed some of the more controversial decisions, like reinstating the Jeep Cherokee and Renegade for 2026, but some dealers previously told BI that the damage is already done.

Investor lawsuits and labor disputes

Tavares also leaves Stellantis in some legal disputes, including an investor lawsuit over the company's poor financial performance. Stellantis has said the lawsuit is without merit and plans to "vigorously defend itself."

The company is also locked in a bitter labor dispute with the United Auto Workers union about manufacturing commitments at an Illinois factory where Stellantis previously built the Jeep Cherokee.

The union has said it's ready to strike and has already begun initiating authorization votes at local units.

Stellantis, in return, has filed a lawsuit accusing the union of violating its contract with the strike threats, citing language that allows for changes to plans based on market conditions.

A special committee has been formed to search for a new CEO, and that process is "well underway," Stellantis said in a Sunday statement. During the search period, Stellantis Chairman CFO John Elkann will lead an interim executive committee, the company said.

• It won't be hard to find a deal on a car this holiday season.
• The best deals will be concentrated in the EV market.
• It might be your last chance to get a really good deal on an EV.

This holiday season could be your last chance to get discounts worth thousands of dollars on electric vehicles.

Holiday car deals overall are expected to be generous this year, as several brands face oversupply. Edmunds data said brands with some of the deepest discounts in November include Stellantis's Ram and Volkswagen's Audi, both of which have struggled with slow sales this year.

But the best deals will likely be concentrated in the EV market, where car companies are looking to offload the last of their oversupply before pulling back production next year in response to slower demand.

This holiday season is likely to be the last gasp for the big EV discounts that dominated the market in 2024, according to Ivan Drury, an automotive analyst for car-shopping website Edmunds.

It has been a topsy-turvy year for the EV market as companies scrambled to adjust their offerings to meet changing demand. The wealthy early adopter buyer base dried up, and was replaced by bargain-hungry shoppers more willing to compromise with a hybrid.

That has been a problem for many car companies, who are just now rolling out big, expensive EVs.

An ongoing price war in the segment has led to a buyer's market for EVs, particularly when it comes to leasing. Access to a $7,500 EV tax credit has also helped car companies by further lowering purchase prices and stimulating demand.

These discounts could end in the near future, as President-elect Trump has vowed to dismantle them.

Here's what you need to know when hunting for an EV deal this holiday season.

EV discounts should be bigger than gas-car deals

Look no further than the EV market if a great deal is all you're after.

Manufacturers and dealers have spent most of this year trying to offload slow-moving EVs, which means that the discounts are much deeper than other car segments.

For people purchasing an EV, the average discount on an electric vehicle in November was more than $3,560 off the sticker price, according to Edmunds. That's compared to an average discount of $1,885 on gas-powered vehicles.

Any EV will likely cost more overall than a comparable gas-powered alternative, however, even with these discounts (and a potential $7,500 federal EV tax credit).

Discounts included, the average price of an EV last month was $59,228, or about $12,000 more expensive than the average price paid for a gas-powered car in the same period.

Focus on the monthly payment

If you want a deal and you're on a tight budget, leasing may be the way to go.

Thanks to a mix of discounts and government incentives, a good lease deal can help you get a lower monthly payment for an EV than a gas-powered car.

EVs with sticker prices under $50,000 in November leased for an average of $44,570 when including discounts offered by the dealer or manufacturer, according to Edmunds. With downpayments around $2,400, the average monthly payment on these EVs was $428. That's $144 a month cheaper than the same segment of gas-powered cars.

EV leasing has taken off in the second half of this year as dealers and manufacturers take advantage of a loophole in the tax credit rules. Leases now account for a majority of EV purchases, according to Edmunds, as green-car shoppers prioritize affordability.

Dealers and manufacturers like these leases because more of their vehicles can qualify for the additional $7,500 EV tax credit. Restrictions that went into effect in January made it harder for EV purchasers to qualify for this credit, but lessees are not held to the same standards.

Leasing is a lower-stakes financial commitment in general, as the lessee is only responsible for the depreciation during the lease term.

The monthly payment on a lease is also more malleable than on a financed car because it is calculated with somewhat squishy numbers. The lender subtracts the estimated residual value of the car from the current value and dividing that by the lease term (plus taxes and fees, of course).

• Car companies are scrambling to adjust to a rapidly changing EV market.
• Restructuring efforts include massive job cuts in some cases.
• Cost-cutting measures come as automotive execs double down on expensive EV commitments.

A protracted transition to electric vehicles is taking its toll on global car companies, many of which still have yet to profit from battery-powered vehicles.

Demand for EVs, particularly in the critical US market, has slowed considerably this year as green car shoppers get more frugal and practical. This presents a problem for car companies that need mass adoption to deliver profits for these expensive vehicles.

Automotive executives have been scrambling to adjust to this new EV market, pulling back on some EV production and speeding up the development of more popular hybrid cars. As 2024 draws to a close, many manufacturers opt for more drastic cost-cutting options as they continue investing heavily in EV technology.

Major car companies like Detroit's GM, Ford, and Stellantis have begun slashing jobs as they cut costs and reshape their business models for this next stage of the EV transition.

Here are all car companies with job cuts planned or already underway in 2024.

General Motors lays off about 2,000 employees

Detroit car giant General Motors laid off about 2,000 workers in two rounds of layoffs in August and November. GM cited cost cutting and changing market conditions in both instances.

The majority of the 1,000 jobs cut in November were white-collar, but the United Auto Workers union reported that about 50 of its members were also affected. According to reports, most affected workers were stationed at GM's global technical center in suburban Detroit, where most design and engineering work occurs.

Prior to the November job cuts, GM also trimmed another 1,000 salaried positions in software and services, according to reports.

GM aims to trim $2 billion in costs as it adjusts its EV strategy and manages slowing sales in the US and China.

Ford to cut 4,000 jobs in Europe amid EV slowdown

Ford said in November that it plans to slash 4,000 positions from its European workforce by the end of 2027. Ford said the Germany and UK divisions are likely to be the hardest hit, as these regions suffer "significant losses."

In addition to these job cuts, Ford also announced curtailed production at a factory in Cologne in the first quarter of 2025.

The cuts to Ford's European business come as companies in the region grapple with intense competition from Chinese EV maker BYD.

In the US, Ford also recently announced an extended pause in F-150 Lightning production, which will affect the roughly 730 hourly workers at that Metro Detroit plant until 2025.

Volkswagen plans historic job cuts in Germany

German automotive giant Volkswagen announced big restructuring actions in October, which could include closing factories and cutting tens of thousands of jobs.

The planned cuts, which still face the scrutiny of German unions, were announced after VW issued its second profit warning in three months. Volkswagen faces similar issues to its rivals, with slowing EV sales in China and stiffer competition from BYD in Europe.

VW's planned restructuring would include closing three German factories for the first time in the company's history, as well as cutting salaries by 10% and freezing wages for two years.

Jeep-maker Stellantis slashes jobs amid tough year

Stellantis, the company that owns brands like Chrysler and Jeep, has had a particularly tough year.

As it struggles with oversupply, it has initiated plans to cut nearly 4,000 factory jobs in the US. Meanwhile, the company laid off 400 white-collar workers in the spring and has offered broad buyouts to salaried workers.

The factory cuts have become a lightning rod for the UAW, accusing Stellantis of violating its contract by removing product commitments from an Illinois factory that built the discontinued Jeep Cherokee.

The UAW has threatened to strike over the alleged violation. Stellantis maintains that its actions fall within its contractual right to change plans based on market conditions. The car company has filed a lawsuit against the UAW in reaction to strike authorization votes.

Tesla reduces global workforce by more than 10%

In an April memo obtained by Business Insider, Tesla CEO Elon Musk told his employees that the company would eliminate "more than 10%" of its staff.

The cuts came after Tesla reported declining sales in the first quarter of the year. After initially weathering a slowdown in EV demand, Tesla is finally feeling the pinch of a more competitive EV market in the US.

Nissan plans to cut 9,000 jobs

Japanese car company Nissan announced in November that it would cut 9,000 jobs and reduce manufacturing output amid poor performance in the critical Chinese and US car markets.

The move came as Nissan reduced its operating profit forecast for the year by 70%.

• EV customer bases are changing, so auto executives are investing in more hybrid-focused models.
• Hybrid EVs can be more practical and affordable than charge-only EVs.
• This article is part of "Getting Ready for Electric," a series of guides and practical advice for buying your next EV.

Though the electric-vehicle market is having its toughest year yet, battery-powered cars are here to stay.

As EV sales slowed this year, major automakers had to reconsider their lofty goals and adjust to shifting customer bases.

Automotive executives moved forward with several EV launches this year, with some companies adding more hybrid models — cars that industry experts say could become a bridge for future EV owners.

Companies are turning to hybrid models to appeal to a more practical and frugal shopper, as wealthy early EV adopters who fueled years of growth have recently fled the market.

It's clear that the expansion the EV segment enjoyed over the past few years is no longer a guarantee of future growth. But executives insist they're committed to an all-electric future, even at a slower clip and with an updated strategy.

In the coming years, you can expect a greater menu of green vehicles on dealer lots — at various price points and with more seamless charging options.

Why more consumers are considering hybrid EVs

Hybrids — once thought to be a relic of the pre-Tesla EV market — are quickly gaining in popularity as EV demand slows.

Green-car shoppers are increasingly drawn to hybrid cars, which come in plug-in and non-plug-in varieties. These cars offer a stepping stone to full EV adoption, with the safety net of a gas-powered engine to ease range anxiety.

While these vehicles solve a pervasive concern among new EV shoppers, a lack of supply has also driven up the price of these cars, creating an affordability barrier for some shoppers.

Still, companies that stayed in the hybrid market over the past several years are now reaping the benefits of a renewed interest in these cars.

Toyota, which was once criticized for its slow adoption of EV technology, is now enjoying big increases in hybrid sales. That's elevating the brand's cache among green-car shoppers in general, with Toyota often at the top of brand considerations for EV shoppers now.

Ford is also taking this approach. The company has said that Ford's hybrid cars are converting more car buyers than any other segment. More than half of all Ford Maverick pickup truck hybrid buyers are new to the brand.

A strategic shift after EV growing pains

The nascent EV market experienced a demand shift this year: The new generation of shoppers are more frugal and practical than their early-adopter counterparts.

But the market is still growing. J.D. Power said that battery-powered cars accounted for 10.2% of retail sales in the US in September, up by 0.8 percentage points from the same month a year ago.

This growth rate is much slower than the rates of the past four years. EV market share soared from about 2% of retail sales in the 2010s to nearly 8% by the end of 2023, Kelley Blue Book said.

The important distinction here is that demand hasn't dried up — it's just changing.

Companies are scrambling to adjust, pulling back production on big, expensive EVs and prioritizing more affordable models. Ford, for example, recently said it would pause production of its F-150 Lightning pickup truck for the rest of the year.

Ford also announced plans in August to replace two electric three-row SUVs with hybrid models. GM promised this year to bring hybrids to the North American market, reversing its full-EV strategy in the region, though the company provided few details about its Stateside hybrid plan.

As companies shuffle the deck, EV launches are expected to slow. S&P Global Mobility expects that about half of the 143 EV launches it's tracking between 2024 and 2026 could be delayed or canceled.

This upheaval is likely to continue after President-elect Donald Trump takes office in January. Trump has been tough on EVs, promising to gut Biden-era legislation designed to support the EV transition.

But it's unclear how much a new administration could undo the Inflation Reduction Act, which includes electric-vehicle tax credits, without Congress's help.

These EV tax credits, which can effectively lower the purchase price of a new car by up to $7,500, have been a specific target of Trump's. As affordability becomes a top barrier to EV adoption, the dissolution of these incentives could lower demand even further.

Tesla CEO Elon Musk has become a close ally of Trump's, which initially gave industry executives and experts hope that the president-elect could soften his EV approach.

However, Musk's stances have largely aligned with Trump's so far, including opposing government subsidies for electric vehicles.

• Trump has been hard on EVs, but a new friendship with Elon Musk could change things.
• So far, Musk supports Trump's plans to dismantle EV tax credits.
• Chinese EVs will likely be the biggest threat to the EV market during Trump's second term.

President-elect Donald Trump took a hard stance against electric vehicles on the campaign trail, but his recent friendship with Tesla CEO Elon Musk has called into question his position on EVs when he takes office in January.

Among Trump's campaign promises is a plan to dismantle the Biden Administration's EV tax credits, which have helped drive down the cost of EVs this year as the vehicles remain frustratingly expensive.

Trump has also promised to pull back on EV sales requirements — which he's falsely referred to as "EV mandates" — implemented with Biden's Inflation Reduction Act.

Musk, now a close ally of President Trump's and nominee for head of a newly formed Department of Government Efficiency, has amassed more influence in Trump's decision-making after the election, calling into question whether he will advocate for or against anti-EV proposals.

Since the election, Musk has been a frequent guest at Trump's Mar-A-Lago estate, and the two have shown public support for each other frequently on social media.

Tesla has long benefited from EV tax credits and fuel economy requirements

The Model 3, one of the most popular EVs in the US, is one of the few EVs that still qualifies for a $7,500 tax credit. Meanwhile, stringent fuel economy requirements have been good for Tesla's credit-sales business, a steady stream of revenue based on Tesla selling its excess fuel economy credits to companies that are not complying with the rules.

Automakers had hoped that Musk would support EV regulations and tax credits, but it appears the CEO is siding with Trump for now. In a post on his social media platform X, formerly Twitter, Musk called to "end all government subsidies, including those for EVs, oil, and gas."

An industry group representing many automakers (but not Tesla) pleaded with Trump to preserve EV tax credits but reconsider some of the more stringent emissions regulations.

Trump wants to keep Chinese cars out of the US

The Alliance for Automotive Innovation also wrote to warn of competition from "heavily subsidized electric vehicles and technologies exported from China."

This existential threat is playing out in Europe, where car companies are hit hard by BYD's entrance. Strict trade policies in the US have so far held at bay this threat.

Trump has said he wants to increase tariffs to keep foreign goods, particularly Chinese cars, out of the US. But it's unclear how this plan can keep the cost of EVs down in the near future — especially with EVs costing some $10,000 more than their gas-powered counterparts.

With no government subsidies to help win over new buyers, car companies will have to discount and lower prices on these already unprofitable cars.

Musk said in May that he is "in favor of no tariffs."

This was an about-face from Musk's stance a few months earlier when he advocated for trade barriers and warned that Chinese EV companies would "demolish" competition without guardrails.

That makes it hard to pin down Musk's exact stance on EV regulations, or how that could ultimately influence Trump. So far, tax credits have helped to boost domestic EV adoption. At the same time, Biden Administration bans on Chinese goods and connected cars have shielded American factories from cheaper overseas competition like BYD or Xioami.

Some experts have seen BYD's entrance into Europe as a canary in the coal mine for US automakers. They say: Don't let them in.

Expanded tariffs on parts or cars from China or any other region are likely to inflate EV prices, and Trump's stated plans to dismantle EV tax credits that ease affordability would erode the segment's progress in reaching more budget-minded shoppers.

This affordability crisis has even dinged Tesla, which has reported rocky sales reports this year as wealthy early adopters drop out of the market.