How Hyundai Is Playing The Game So Perfectly Right Now

I’m driving a Hyundai Tucson Hybrid this week, and it’s amazing how many I’ve noticed on the roads. They’re everywhere! The automaker has been clever and thoughtful in how it has tried to balance electrification and hybrids, imports and local production, politics and preference. This doesn’t mean there aren’t risks, but Hyundai has done better than almost everyone else at managing them.

The Morning Dump today is all about calculated risks. Hyundai has made a long-term bet on North America, which it doubled down on with President Trump yesterday. Where is President Trump’s friend Elon Musk focusing his priorities? Probably China, especially as Europe is looking more and more difficult for Tesla. Is this just noise?

Bollinger’s namesake, Robert Bollinger, is suing his former company and alleging that the EV truckmaker is essentially bankrupt. A little closer to Autopian HQ, the City of Los Angeles isn’t bankrupt yet, but budget cuts and shifting priorities have led to a drop in parking ticket revenue, which has caused the budget to get even harder to balance.

The world is complicated!

The Hyundai Plan Is In Full Effect

Yesterday, Hyundai Motor Group Executive Chairman Euisun Chung met with President Trump and other Republican leaders at the White House to announce $21 billion in investments in the United States. This was a concrete win for President Trump, who, in addition to thanking Hyundai, let worried investors know that his tariff plans are maybe not as bad as initially seemed.

It’s impossible, especially now, to divorce your perceptions of this event from your own political views. If you’re a fan of the President, this is, as the President said, “a clear demonstration that tariffs very strongly work” and “at levels that have not been witnessed.” If you’re not a fan, you might see the President’s removal of tariffs on Hyundai as another sign that the President can be bribed or flattered to cave quickly on his own positions.

Neither of these views captures the much deeper point, which is that the politics of all of this is bent towards Hyundai and not the other way around. Let’s talk about what’s actually happening first. Hyundai is committing to spending as much as $21 billion in the United States in the coming years, a lot of which will be for a steel mill in Louisiana, as reported by Nikkei Asia:

“A key part of this commitment is our $6 billion investment to strengthen the U.S. supply chain from steel and parts to automobiles,” Chung said.

“We are especially excited about Hyundai Steel’s multi-billion investment in a new facility in Louisiana, which will create 1,300 American jobs and serve as the foundation for a more self-reliant and secure automotive supply chain in the U.S.”

[…]

Chung said that the automaker is opening a new $8 billion auto plant in Savannah, Georgia, which the company says will create more than 8,500 jobs and push Hyundai’s annual U.S. output to over one million units.

Chung also announced that the motor group will purchase $3 billion worth of U.S. liquified natural gas “to support America’s energy industry and enhance our energy security.”

That’s a lot of money. Did all of this happen because of tariffs? It’s difficult to know for sure, but localization was certainly in the works, and it makes a lot of sense for Hyundai, strategically, to announce this now so it can avoid tariffs on imported cars, which would undoubtedly impact the automaker. If we go back to Hyundai Steel’s Q2 2024 report, from before it was clear who would be the next President, we see this:

It’s the realization that Hyundai, as it expands in the United States, probably needs more control over its own supplies. In this specific instance, it’s talking about a steel services center (SSC) that turns the processed metal into automotive-grade steel for use in EV production. You can see on that map where most of Hyundai and Kia’s manufacturing base is. Just geographically, Louisiana looks like an ideal place to put local steel production. If anything, this is actually a better reflection of President Trump’s first-term steel tariffs, which made onshoring production here more attractive.

As for production increases here, Hyundai Motor’s 2023 annual investor report makes that also an obvious outcome.

What’s Hyundai been building in Georgia? Electric SUVs. Viewed one way, both a Harris or Trump Administration would have made the company do this. With President Trump, he’s using the stick of tariff threats. With a Harris or 2nd Biden Administration, it was the carrot of the Inflation Reduction Act, which incentivized local production. While other automakers, like Stellantis, have become flat-footed trying to adjust their American-ness, Hyundai has long recognized that it needs the United States market and hasn’t ignored it.

This brings up an interesting question: Hyundai relies on the lease loophole to allow it to pass on the $7,500 tax credit to consumers. Will President kill the tax credit, as he’s promised? Will that hurt Hyundai? Maybe, but Hyundai also has an answer for that, as explained by CEO Jose Muñoz previously:

“Hyundai did not build our [U.S.] investment plan based on incentives; the plan was even made before in Trump’s [first] term,” said José Muñoz, current global chief operating officer at the world’s third-largest automaker, during an interview with the Korean press at the LA Auto Show in California on Nov. 21.

“If the Inflation Reduction Act [IRA] goes out, it goes out for everybody, and we can even do better [if it does],” Muñoz added. “At the moment, the IRA is for some competitors but not for Hyundai, but we’ve been growing.”

“Competitors like Tesla step by step are losing market share and we continue to increase our share.”

If you build your business on the expectation of a specific political outcome, you might be right, or you might be terribly wrong. If you build your business on basic business fundamentals, rather than being forced to bend towards a political will, you can make it bend towards you, as Hyundai has done here.

Is Tesla Really Failing?

Tesla’s stock rallied yesterday as investors saw promise in the automaker’s potential rollout of FSD in China soon, though the stock opened down today. What’s going on? I do feel a worried that I’m getting sucked into the swing of the company’s share price as an indicator of reality and not what it really is, which is just a bunch of investors trying to interpret the news.

Is the news good or bad? The best sales results data on the planet comes from Europe and, for a second month in a row, it looks super bad for Tesla. According to the industry group ACEA, Tesla’s sales in the EU dropped 47.1% year-over-year in February. That’s almost half, or more than 10,000 vehicles. The only brand that did worse over that same period was Jaguar, and Jaguar is basically not making cars for a while.

It’s possible that this is just a slowdown due to the factory switching over to new Model Y production. Or maybe Europeans are sending CEO Elon Musk their own awkward salute. The overall car market in February wasn’t great in Europe… except for EVs. Year-over-year electric car sales grew by 23.7%, meaning that Tesla’s market share is eroding (falling from 2.1% to just 1.1% in the EU).

What about China? Tesla can afford setbacks in Europe if it makes up the difference in China. Here, a more complicated picture emerges:

$TSLA ????????
BREAKING: Tesla China insured units

<Mar 2025>
3-9 : 13,800
10-16 : 15,300
17-23 : 17,400

Reversed last year’s figures based on my data! pic.twitter.com/qcKHHcIgbA

— Tsla Chan (@Tslachan) March 25, 2025

As you can see, secondhand insurance data shows that YTD the company is possibly up by a small percentage. I also love this chart because you can delineate clearly where the quarters end as sales curiously drop by huge amounts around the 14th week. As with Europe, there’s possibly some production turnover here that’s slowing down Tesla.

Being flat, or a little up, isn’t a great sign in China, where the competition is doing great. If Tesla is increasing its sales at the price of margins, but remaining flat while its competitors grow and make more money, then it’s not in a good position. To some degree, that appears to be happening, as this CNN analysis notes:

There are three letters keeping Tesla bulls up at night: BYD.

That’s the carmaker eating everyone’s lunch in China, the world’s biggest auto market, and rapidly gaining market share around the globe (except in the United States, of course, because of longstanding trade restrictions on Chinese imports).

On Monday, BYD reported $107 billion in revenue for 2024 — crossing the $100 billion level for the first time and besting Tesla’s annual revenue by about $10 billion. That milestone came a week after BYD unveiled a charging system that it says will give its latest EV model 250 miles of range after plugging in for just five minutes.

I can’t wait to see Tesla’s Q1 sales numbers in a couple of weeks.

Bollinger Founder Reportedly Thinks Bollinger Is Broke

Mercedes drove the Bollinger B4 Class 4 commercial truck in 2023 and found that electrification made for a great work truck. Almost a year later, Bollinger started producing consumer vehicles, which is a big step for a new company. So everything’s gravy? Not quite.

Per Automotive News:

The founder and former CEO of the Class 4 truck maker, Robert Bollinger — who left in June — filed a $10 million suit against Bollinger Motors on March 21 and is seeking to have a receiver appointed to manage and possibly wind down the business by liquidating assets until he is paid in full.

The dispute centers around a $10 million loan Bollinger made to his old company in October. The terms of the loan call for periodic interest-only payments of $125,000, according to the lawsuit, which was filed in the Court for the Eastern District of Michigan.

It’s possible Bollinger is just playing hardball, though it’s never a good sign when the guy whose name is on the trucks is suing the company that makes them.

Los Angeles Has A Parking Ticket Problem

A bad way to save money is to just stop paying your bills. Don’t pay for your mortgage, your car note, your gas, your water, or anything bill you get. For a short period of time, maybe even up to a couple of months, you’ll increase your liquidity by a bunch. For a much longer period of time you’ll probably harm your credit, lose your electricity, and maybe even your house.

The City of Los Angeles is seeing a major decrease in its parking ticket revenue, which the city needs to pay its bills. What’s going on here? From the local news pub Crosstown, we get a little insight into the possible cause of Los Angeles losing $65 million in expected parking enforcement revenue. For years, the City has looked to cut enforcement costs and increase the amount of work parking enforcement officers have to do, causing revenue to drop:

Staffing isn’t the only issue. In 2020, with many parking restrictions temporarily lifted, officers shifted from writing tickets to focusing more on other responsibilities that didn’t generate revenue, including supporting COVID-19 testing and vaccination sites.

Officers manage traffic flows at large events and support police and fire department investigations. Currently, many officers also assist the Inside Safe program, Mayor Karen Bass’ initiative to address the city’s homelessness crisis. These responsibilities now collectively make up half their workload, Sweeney said, leaving them less time to issue tickets.

Last February, Bass directed the city to engage in “prioritized critical hiring,” a cost-cutting measure that severely limited the addition of new staff. Sweeney said the directive will make it more difficult to hire new traffic officers.

Tackling homelessness is one of the hardest issues facing any jurisdiction (though other large cities have shown it’s not an impossible problem), and it’s one that usually falls on law enforcement. Shifting the burden to parking enforcement doesn’t seem to be solving the issue, nor does cutting ticket writers.

What I’m Listening To While Writing TMD

The musical theme of this week is Laura Nyro, the great American composer and songwriter. Yesterday we heard, maybe, her most famous cover. Today it’s Elton John doing his best Laura Nyro impression with the excellent “Burn Down The Mission” from the BBC In Concert series. The piano break two minutes in is just pure Nyro, as Elton John himself has admitted.

The Big Question

Is anyone doing it better than Hyundai right now? Toyota?

Top photo: Hyundai Motor Group