Tesla's news cycle over the past few months has been like watching a reality TV show. Between the number of layoffs, backtracks on layoffs and just generally wonky decisions coming out of the automaker's top offices, the company's path forward has been a rather confusing read. And now, with news of more departures and potential rehires of the Supercharging team, the next episode in Tesla's 21st season is bound to be a doozy.
Welcome back to Critical Materials, your daily roundup for all things EV and automotive tech. Today, we're talking about Tesla's tumultuous staff situation, Waymo's federal probe over crashes, and the potential issues for U.S. auto workers due to retaliatory tariff threats from China.
30%: Tesla Cybertruck Chief Out As Musk Walks Back Some Charging Layoffs
It's never a dull day at Tesla as the cutting room floor seemingly continues to have new bodies hit it nearly every day for the past five weeks. This time it's Tesla's head of manufacturing for the Cybertruck, Renjie Zhu, who announced that he would be departing the company on LinkedIn.
Zhu is one of the many high-profile personnel changes since Tesla announced that it would be cutting more than 10% of its global workforce. It's not clear whether Zhu was part of these layoffs, or if he left on his own accord.
Meanwhile, the vibes inside the company are off. Rich Otto, head of product launches at Tesla, recently attributed his voluntary departure to the company's "recent layoffs [rocked] the company and its morale" in a now-deleted LinkedIn post.
These layoffs also included Tesla's entire 500-person Supercharging team, which led the public to question CEO Elon Musk's motives. After all, that particular business unit was responsible for bringing on outside OEMs to Tesla's DC Fast Charging network and was slated to earn the automaker as much as $3 billion annually by 2030.
However, it seems that Tesla may have about-faced its decision after harsh criticism came from nearly every direction.
A new report from Bloomberg signals that Tesla has begun re-hiring employees let go during the shakeup of its Supercharging team. Citing people familiar with the matter who wish to remain anonymous, Bloomberg says that the director of charging for North America, Max de Zegher, is back in at Tesla. Previously he was one of the top managers working on the unit's director, Rebecca Tinucci.
It's not clear just how many people from the Supercharging team have been (or will be) rehired, though a leaked memo from Musk indicates that those who work for Tesla, especially the executive staff, must pass the "excellent, necessary and trustworthy test."
Tesla has pledged to pour at least $500 million into its Supercharging network by the end of the year.
60%: Feds Probe Waymo Over Crashes, Traffic Violations
The National Highway Traffic Safety Administration (NHTSA) has launched a probe into Google's self-driving sister brand, Waymo, following at least 22 reports of incidents involving the company's vehicles that have resulted in either a crash or traffic violation.
NHTSA's Office of Defects Investigation (ODI) launched the preliminary evaluation to determined what exactly is going on over at Waymo. According to ODI, some of the crashes studied so far may have occurred do to vehicles "disobeying traffic control devices" or exhibiting "unexpected behavior near traffic safety control devices."
Initial evaluations point the finger at Waymo's automated driving system, at least preliminarily. Early findings indicate that the software was either active during each incident or disengaged just moments before it occurred.
The office says that it will now look to assess how adequately Waymo's vehicles detect and respond to traffic control devices. It also wants to know just how well the vehicles can avoid collisions with stationary and semi-stationary objects, as well as other vehicles given the reports of collisions.
At least two minor collisions resulted in Waymo issuing a recall for 444 vehicles earlier this year.
"NHTSA plays a very important role in road safety and we will continue to work with them as part of our mission to become the world's most trusted driver," wrote a Waymo spokesperson in a statement to Automotive News.
90%: China's Retaliatory Tariffs May Cost U.S. Auto Workers Their Jobs
As expected, the White House officially announced its plan on Tuesday to increase a Trump-era tariff which increases tariffs on Chinese EVs from 25% to a whopping to a whopping 100%.
The administration's justification for the increase is, in-part, centered around "unfair" practices. It's been theorized that the Chinese EV manufacturing segment has been built around government subsidies, something which consulting firm AlixPartners says has funded the expansion of the industry by around $57 billion between 2016 and 2022. The result is a production over-capacity of around 35%, which means a wave of EVs with no domestic buyers—and that's where foreign markets come into play.
See, it's been a worry of U.S. automakers and lawmakers that these cheap Chinese EVs could flood the market, even calling it an "extinction-level event." The result would be vehicles that sharply undercut U.S. automakers in price, or outperform them with more efficient batteries and more desirable in-car tech.
And now the quadrupled levies could result in U.S. companies being subject to retaliation tariffs from China, especially after the country's commerce ministry vowed to take measures to defend its interests should the White House pass the measure.
Due to pre-existing protectionist tariffs, the U.S. serves as an export hub for a number of vehicle manufacturers. In 2021, the country exported 155,337 vehicles to China—the third-largest export market for U.S.-produced cars after Canada and Germany.
Reuters warns that potential retaliatory tariffs could mean trouble for U.S. auto workers at plants that thrive on exports to China:
Chinese retaliatory tariffs that targeted U.S. vehicles could hurt workers at the BMW factory in Spartanburg, South Carolina, which sends about 25,000 vehicles to China per year, or the Mercedes-Benz SUV plant in Alabama that builds electric SUVs sold in the world's largest market.
A clean-technology trade war between the United States and China could also drive up the costs of EVs, batteries and other EV hardware, keeping overall EV prices high, industry executives and some analysts said. EVs wearing U.S. brands, such as the Mustang Mach-E or Tesla Model 3, have 30% to 51% Chinese content, according to U.S. Transportation Department data.
As Reuters notes, BMW is one of the largest luxury marques that utilize U.S. manufacturing facilities to export to China. In 2022, China represented 13.5% of all exported SUVs produced by BMW at its plant in Spartanburg, South Carolina—the only larger market was its home turf of Germany. Mercedes-Benz, Ford, and Chrysler have all historically been large exporters to the country as well.
If China decides to implement retaliatory tariffs against the U.S. auto industry, it could push the industry away from U.S. manufacturing in favor of more affordable outlets. Or, it could result in the increased cost being passed to the consumer to foot.
The White House has downplayed the possibility of these retaliation tariffs from China, but we'll see how its government responds.
100%: Would U.S. Consumers Benefit From Cheaper Chinese EVs?
It's no secret that the U.S. wants to accelerate its transition away from gasoline. Domestic automakers and charging companies are sprinting towards the opportunity, especially with a ton of government cash on the table. There's just one problem: EVs aren't cheap.
Well, in the U.S. they aren't, at least. Chinese automakers have seem to have a leg-up on the U.S. in the whole EV race with cost and in some cases, even battery tech. That makes it hard for the consumer to ignore these options, even when they aren't available in the States.
That being said, would it help for consumers to adopt cheaper, Chinese-sourced EVs? Or would the path to cleaner emissions be muddied by the potential economic woes associated with the market shift? Let me know in the comments.
