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Viewpoint: Why EVs hold the key to the next US election

  • Spanish Market: Battery materials, Metals
  • 20/01/25

While the inauguration of President Donald Trump may have sent a shudder through the boardrooms of electric vehicle (EV) producers, boosting the US EV market during his term may be the best way to keep Republicans in the White House in 2028.

President Trump has been highly critical of the EV market in previous years, and aims to abolish the $7,500 consumer tax credit for EVs.

Despite this, a combination of the Inflation Reduction Act (IRA), corporate tax breaks, support for Tesla owner Elon Musk and, counter-intuitively, an oil boom, could herald the start of the good years for the US EV market. And a Trump administration would be foolish to resist it.

IRA boosts key swing states

Donald Trump ran on a manufacturing ticket. Among his slogans were "drill baby drill" and an evolution of the MAGA tagline: "Make America Greater Than Ever Before". That second slogan cannot be achieved without manufacturing the technologies of the future, including EVs, and thanks to former president Joe Biden those jobs might land in key areas for the 2028 campaign.

The US EV market has had a slow start to the latest phase of expansion, lagging behind as Europe and China boomed in 2022-2023. This changed last year, as US EV sales in 2024 rose by 7.2pc and totalled 1.3mn, according to Cox Automotive. Momentum is starting to build. The Inflation Reduction Act (IRA) passed under Biden's tenure has become a catalyst for EV investment, much of it in key swing states and red states. This makes it unlikely the Trump administration will roll back any of the government money allocated to projects since the IRA was passed.

In a study from August 2024, US clean energy think-tank E2 discovered nearly 60pc of the announced projects under the IRA are based in Republican congressional districts.

Of all new projects, Republican districts represent 85pc of investment and 68pc of jobs. Of the top 20 congressional districts for clean energy investments, 19 are held by Republicans.

The largest of these investments so far, Toyota's $13.9bn EV production plant, is in the key swing state North Carolina, which Trump won by a 183,000 vote margin in 2024. The Toyota plant will create up to 5,000 jobs, most of which are due to start during Trump's second term. wOther swing states have multiple projects supported by the IRA. Michigan, Georgia, South Carolina, Texas and North Carolina have over 20, while Ohio, Tennessee, California, New York, Indiana and Arizona have more than 10. Most of the states with multiple projects are key marginals which were pivotal for a Trump victory in 2024, except California and New York. Unfortunately for Biden, the benefits of his flagship legislation were too late to save the presidency for the Democrats, but they may benefit Republicans next time around.

Big tech and big oil

The new Trump administration is filled with contradictions, which are likely to expand into open conflict. Nowhere is this more evident than the contrast between interests of Tesla founder Elon Musk and Trump's "drill baby drill" policy.

Although Musk has rolled back some his more fervent views on climate change, he still supports a transition to EVs, led by Tesla. His competition in the oil industry have also started to shift their policies on electrification.

Both ExxonMobil and Saudi Aramco, two leading oil majors, have announced investments into lithium extraction over the last year.Trump's promised tax cuts and oil licence bonanza may give them a windfall of cash just at the point that oil executives are looking to put money into the electric transition. Despite his pro-fossil fuel rhetoric, Trump may leave office having presided over an increasingly green America.

EV sales in the US, by carmaker ('000s)

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11/02/25

Mexican steel faces few outlets in wake of US tariffs

Mexican steel faces few outlets in wake of US tariffs

Houston, 11 February (Argus) — Mexican steelmakers, facing sluggish domestic demand, could struggle to find outlets for production after the elimination of US steel tariff exemptions. US president Donald Trump on Monday revoked all exemptions from the 25pc steel import tariff, effective 12 March. Canada and Mexico as part of the US-Mexico-Canada Agreement (USMCA) were exempt from Section 232 25pc steel tariffs announced in 2018, along with Argentina, Australia, Brazil, the EU, Japan, South Korea and the UK. The renewed 25pc tariffs also include "derivative steel articles" — downstream and value-added products. Mexico also faces the potential imposition of a 25pc all-goods tariff in March by the Trump administration. Originally meant to be imposed on 1 February, the tariff was delayed by 30 days on 4 February. Should the tariff — which only included Mexico and Canada — be imposed at the end of the postponement, US buyers could face a 50pc tariff on Mexican steel. More Mexico capacity looms The gap left by the imminent exit of the US as a free trade partner leaves Mexican steelmakers with few obvious outlets as a slew of incoming capacity expansions are poised to bloat domestic inventories. Mexico produced 18.2mn metric tonnes (t) of steel in 2024 , down from 19.85mn t in 2023 as steelmakers pulled back production to counter weak demand, according to Mexican steel association Canacero. Mexico exported 3mn t of steel in 2024 — 2.3mn t of which went to the US, according to Canacero. That was followed by Canada, which imported just 118,000t in 2024, and Saudi Arabia, which imported 90,000t. Still, Mexican mills are expected to add more than 5mn t/yr of additional steel production by the first half of 2026. About half of that will come from steelmaker Ternium's slab mill in Pesquería, Nuevo León, which is expected in the first half of 2026. The Ternium slab mill's location in northern Mexico was meant to help supply steel to the USMCA region . Some in the market more recently told Argus that the new tariffs would have very little effect on Pesquería's strategy — positing that the slab produced there could be exported to Ternium's facilities in Brazil. Still, Mexico only exported 27,000t of steel to Brazil in 2023 and it was not listed as a top-10 export partner in 2024. Long steelmaker Deacero in 2023 also announced a $1bn expansion over three years to grow production by 1.2mn t/yr. Deacero's expansion, too, was aimed at meeting expected nearshoring-driven demand in the medium and long term. In 2023, long steelmaker Simec announced a new 500,000t/yr rebar mill and Brazilian steelmaker Gerdau in May announced it was exploring sites for a 600,000t/yr special steel mill in Mexico. Slow demand adds further pressure In the absence of overseas demand for steel, Mexican steelmakers could have to look to a shaky domestic market to offload production. Federally funded infrastructure projects like the Tren Maya, the Olmeca Refinery in Tabasco and the Felipe Ángeles airport near Mexico City either wound down or concluded by 2024. The projects took with them a boon in steel demand and production that faded further as buyers were reluctant to commit to tons before the general elections in June 2024. That demand has yet to recover. Mexican president Claudia Sheinbaum, who took office in October, campaigned partly on the construction of 1mn homes — which would require an uptick in rebar consumption. Sheinbaum is expected to announce her full infrastructure plan on 17 February. The market has few other options for Mexican-produced steel should the government not adopt publicly funded steel-consuming projects as the country faces expectations of slower economic growth this year. Nearshoring efforts, including plans for domestic production of electric vehicles (EVs) from both Chinese EV makers and US automaker Tesla, have stagnated. A wider count of new foreign direct investments in Mexico shrank last year to the lowest level since 2014 . Sheinbaum on Monday confirmed that the Mexican government learned of the steel tariffs from media outlets. Any previously discussed retaliatory measures would come after a clarification of the tariffs, Sheinbaum added. By Marialuisa Rincon Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Trump steel tariffs end exclusions, expand scope


11/02/25
11/02/25

Trump steel tariffs end exclusions, expand scope

Houston, 11 February (Argus) — The US' planned extension of 25pc import tariffs on steel set to go into effect on 12 March will wipe out existing import quotas, exclusions and agreements established during the first administration of President Donald Trump, essentially resetting the playing field for US steel imports. The proclamation signed by Trump on 10 February said the tariffs are intended to increase US steel capacity utilization to 80pc and close loopholes in the existing tariff scheme that have led to increased imports. This would mean certain products that had been excluded from past tariffs, including those not currently made domestically, would no longer be able to be exempted once existing exclusion orders expire or volume quotas are reached, whichever happens first. Trump's latest tariff push will also target a broader swath of downstream steel products, while setting up a dedicated process for US producers and industry groups to request products be subject to the 25pc tariff. The US will determine whether or not to include the product within 60 days of the request. The Trump proclamation cited increased imports of steel derivative products, such as fabricated structural steel and pre-stressed concrete strand, as signs of countries evading the existing tariff, which was implemented under Section 232 of the Trade Expansion Act. Market participants widely expected the reinforcement of the 25pc import tariff for steel. But many initially downplayed the possibility for the import tariff rate to increase to 50pc for Canada and Mexico, which would be the case if the US moves forward with proposed blanket 25pc duties for those two countries next month. Trump first imposed Section 232 national security tariffs of 10pc on aluminum and 25pc on steel imports in March 2018. Since then the tariffs have been partially rolled back on certain countries, while importers were allowed to ask for product-specific exclusions. Currently Australia and Canada can export any steel and aluminum they want to into the US without tariffs, while Mexico can export steel melted and poured in the US-Mexico-Canada (USMCA) agreement region into the US without tariffs, while any material with an origin outside of USMCA is subject to 25pc tariffs. Steel tariff rate quota (TRQ) systems were in place for Argentina, Brazil, the EU, Japan, South Korea and the UK for steel products, with specifics dependent on the country. Steel imports are heavily reliant on the nontariffed countries, with their volumes making up 80pc of the 26.2mn metric tonnes (t) of steel products imported in 2024, according to US Department of Commerce data. By Blake Hurtik Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexican auto exports slow in January


11/02/25
11/02/25

Mexican auto exports slow in January

Mexico City, 11 February (Argus) — Mexico's light vehicle exports fell by 14pc in January from a year earlier as uncertainty over US trade policy raises questions over prospects for exports going forward. Automakers in Mexico shipped 219,414 units in January, with 84pc bound for the US, according to statistics agency Inegi data. January exports declined by 17pc from December. Meanwhile, production edged up by 2pc to 312,257 units in January from a year earlier, while domestic sales rose by 6pc to 119,811 vehicles. Still, domestic sales dropped by 18pc from December. The mixed performance signals a sluggish start for the sector in 2025, following a record-breaking 2024 , when Mexico produced 3.99mn autos and exported 3.49mn. "While the industry continues to grow, it does so at a slower pace," said Guillermo Rosales, president of Mexican retailer association AMDA. Investment in Mexico's auto sector slowed in November and December, reflecting lower producer confidence and expectations of slower economic growth in 2025, Rosales added. AMDA forecasts 1.53mn auto sales in 2025, up by 2.2pc from a year earlier. But should the US impose a proposed 25pc tariff on Mexican vehicles, the forecast falls to 1.48mn sales. Inegi reported 10,881 electric (EV) and hybrid vehicles sold domestically in January, a 36pc annual increase. But sales fell by 30pc from December, marking the segment's first monthly decline since August. Automaker association AMIA said EV and hybrid production jumped by 60pc to 169,929 units last year. While AMIA did not report January figures, an Argus analysis of Inegi data shows production of four of Mexico's five EV and hybrid models reached 16,034 units in January, up by 86pc from December. Inegi did not separate production totals for the Wagoneer S EV and its internal-combustion counterpart, although AMIA reported 4,726 units produced in 2024. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

China’s BYD to add DeepSeek AI to its affordable EVs


11/02/25
11/02/25

China’s BYD to add DeepSeek AI to its affordable EVs

London, 11 February (Argus) — China's largest electric vehicle (EV) maker BYD on Tuesday announced plans to integrate software from AI start-up DeepSeek into 21 of its models at no extra cost, including one model under $10,000. All models with the God's Eye advanced driver assistant software (ADAS) will come at no extra cost, chairman Wang Chuanfu told an event livestreamed from Shenzhen. Chuanfu said autonomous driving would no longer be a rarity but a "necessary tool", one that will become an "indispensable tool like safety belts and airbags" within a few years. BYD said it would offer advanced autonomous driving features on all of its 18 models priced above 100,000 yuan ($13,686). The carmaker will also include AI on three models below Yn100,000. BYD had previously only offered ADAS on models above $30,000, in line with US EV maker Tesla, which has similar features on its EVs priced above $32,000. The system includes remote parking and autonomous highway navigation. Smart driving features in EVs require Argus -assessed metals such as gallium — in gallium nitride — and germanium in semiconductors. AI growth and data centre demand is expected to increase the use of compound semiconductor materials including gallium nitride, gallium arsenide and indium phosphide. BYD sold around 4.2mn EVs last year in China — including battery EVs (BEVs) and plug-in hybrid EVs (PHEVs) — dominating the domestic market of 11mn EVs, up by 40pc on the year (see graphs) . DeepSeek integration threatens exports The integration of AI into BYD cars is the latest indication that competition in the Chinese EV market is hotting up, although several market participants fear that the integration of DeepSeek AI may threaten sales into export markets, particularly the US, where there is antipathy towards Chinese AI. Chinese EV maker Leapmotor, partner of carmaker Stellantis in Europe, launched its own smart-driving EV on Tuesday priced under Yn150,000 ($20,535), using its own AI. Prior to BYD, the cheapest affordable EV with comparable smart driving features was SAIC-GM-Wuling's $15,000 Baojun Yunhal model. Other Chinese EV makers have also announced integration of DeepSeek technology into their models. Chinese carmaker Geely Group — parent to brands such as Volvo and Polestar — announced that it will integrate the DeepSeek R1 model into its EVs, alongside its own Xingrui AI model, which it announced that it was training last month. It has largely distinguished software in its Geely brand The future of EVs is an "electric intelligence vehicle", Pan Jian, co-chair of CATL , the world's largest battery maker, said at the World Economic Forum last month, with intelligence fast becoming inseparable from EVs. By Chris Welch Global EV battery installations 2023-24 GWh Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

CME north EU HRC curve softens on US duty


11/02/25
11/02/25

CME north EU HRC curve softens on US duty

London, 11 February (Argus) — North European hot-rolled coil (HRC) futures prices softened today, as the market digested the imposition of 25pc US tariffs on all imports. During the London morning, March traded at €622/t in the broker market on CME Group's north European HRC contract, down from €633/t last Friday. April traded at €627/t, down from the last trade also at €633/t, before slipping to €625/t at 13:43 GMT. February traded at €602/t, a premium of €8.62/t to the month-to-date average of Argus' underlying north EU HRC index, at €593.38/t, with 13 trading days still remaining. On the CME screen, March traded down by €13/t to €620/t, while July nudged down by €2/t to €645/t. The US accounts for around 15pc of EU HRC exports and it takes another 1.3mn t across cold-rolled coil, hot-dip galvanised and tinplate, based on January-November 2024 data. It took over 683,000t of tinplate in the first 11 months of last year, from Germany and the Netherlands. The new US tariff, applied without exemption, could redirect tonnes to the EU, although the safeguard review will address this to some extent from 1 April. The tariff strengthens the case for an EU melt-and-pour clause against Chinese steel, and a meaningful revision to quota volumes, sources said. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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