As a reporter covering the auto market, it’s not my role to advocate for firms. Quite the contrary, in many cases. Yet, I do feel some sympathy for them. They’re all barreling towards an eventual all-electric future, though exactly how “eventual” that is depends on who you ask. In the meantime, balancing customers’ desires and needs with strengthening emissions policies—while managing a capital-intensive business that requires years of planning—is hard, to say the least.
All of this sets the stage for the current trend: amid uneven EV sales, American buyers now claim they want plug-in hybrids. But will they—the customers, the automakers, even the charging providers—align to make that desire a reality?
That kicks off this Monday edition of Critical Materials, our morning roundup of technology and mobility news. Also on deck today: those aggressive new anti-China tariffs aren’t as popular as you might think, and Honda is still debating what to name its EVs. Let’s dig in.
30%: A Plug-In Hybrid Boom or Bust?
Jeep Wrangler Rubicon 4xe
Call it an unexpected side effect of the EV revolution: buyers are increasingly aware of EVs, but for various reasons, feel they’re “not ready.” However, they seem more open to hybrids than ever. This shift explains why hybrid sales are starting to outpace EVs, why automakers like General Motors are reversing their stance on hybrids, and why Ford is replacing a planned three-row electric SUV with a hybrid alternative instead.
Beyond traditional hybrids, plug-in hybrids (PHEVs)—which combine gas-powered functionality with plug-in charging for enhanced battery range—are gaining traction.
Here’s the catch: there still aren’t many PHEVs on the market today. EV options far outnumber them. Although more models are on the horizon, it will take years for them to arrive. By then, will the market still want them?
The Wall Street Journal recently explored this trend and what might come next:
The number of plug-in hybrid models on sale in the U.S. has nearly doubled since 2019, to 47, according to vehicle research site Edmunds. These include well-known nameplates such as the Toyota RAV4 and Ford Escape compact SUVs.
Manufacturers say some car buyers interested in EVs still want the reassurance of a gas engine. Customers are also discovering that with substantial support from automakers and the government, plug-in hybrids can sometimes be the most affordable option.
[…] In the U.S., much of the growth of plug-in hybrids has been driven by regulations, analysts say.
Jeep’s Wrangler and Grand Cherokee models alone accounted for about one-third of U.S. plug-in hybrid sales in the first half of 2024, according to Motor Intelligence. Stellantis, Jeep’s parent company, has leaned heavily on PHEVs to meet state and federal emissions rules, offsetting its historically fuel-hungry lineup.
“Plug-in hybrids balance the need to reduce vehicle emissions while giving customers an entry point to electrified vehicles,” a Stellantis spokesperson said.
Still, the PHEV market remains unusual.
While brands like Volvo, BMW, and Lexus are PHEV stalwarts, other offerings—such as Toyota’s Prius Prime and RAV4 Prime—are notoriously hard to find. Stellantis often relies on aggressive discounts and incentives to move its PHEVs. Meanwhile, GM plans to re-enter the market but not until 2027—a long time in the rapidly evolving auto landscape.
Furthermore, there’s the question of whether buyers will even plug in their PHEVs consistently. Will they contribute meaningfully to expanding the charger network? And will dealers properly educate consumers on how to use them? Historically, dealers have struggled to do so with EVs.
Ultimately, EVs, PHEVs, and hybrids shouldn’t be seen as an “either/or” proposition in the near term—reducing fuel use and emissions is always beneficial. But PHEVs are increasingly viewed as a last-ditch effort, and their widespread, mainstream success is far from certain.
60%: Not Everyone Loves the China Tariffs
Zeekr NYSE
As China’s EV industry races ahead and establishes a presence in Mexico, you’d expect every U.S. automotive stakeholder to support the Biden administration’s stringent new 100% tariffs on Chinese EVs and related battery components.
Not quite. According to Reuters, the relationship between the U.S. and China is more entangled than most people realize. Some industry stakeholders are urging the U.S. government to ease up:
Manufacturers of everything from electric vehicles to electric utility equipment have requested that higher tariff rates be reduced, delayed, or abandoned altogether, and that potential exemptions be significantly expanded.
[…] Autonomous legislators from Virginia and Georgia have raised concerns about impacts on ports in their states, calling for existing orders of Chinese cranes to be exempted.
Ford Motor Company has also requested reduced tariffs on synthetic graphite, a key material for EV battery anodes, noting that it still “almost exclusively” relies on Chinese secondary-particle graphite. Similarly, foreign-brand automakers argue that tariff rates on batteries, modules, and critical minerals should remain stable through at least 2027 to allow U.S. manufacturers to scale their operations.
A final decision on these tariffs is expected by the end of August, but complications from the upcoming election may delay any outcome.
90%: Honda Doesn't Know What to Call Its Next EVHonda Saloon Concept
What’s in a name? It seems Honda is grappling with this question as it transitions to EVs. According to Automotive News, the automaker is unsure whether to preserve its iconic model names or forge a new path.
The Honda Prologue name, chosen for its GM-sourced electric platform, marked the beginning of this transition. But for future models based on Honda’s proprietary EV platform, the naming strategy remains undecided.
Executive Vice President Shinji Aoyama expressed the dilemma succinctly:
“We understand the importance of vehicle naming. Customers are confident with existing names like Civic, Accord, and CR-V, but we’re questioning what to do.”
This isn’t a challenge unique to Honda. Volkswagen’s EV lineup uses the “ID” naming convention but hasn’t abandoned iconic models like the Golf. BMW and Mercedes-Benz are similarly navigating this shift while preserving their brand identity.
One potential solution? Retaining well-known names with slight modifications, such as “e-Civic” or “Civic Electric,” to balance familiarity with innovation.
As Acura prepares to release a battery-powered sports car in 2028, even its legendary NSX name hangs in the balance. Going fully electric could offer a new twist on the New Sports eXperimental.
100%: What’s the Right Approach to Auto Naming in a PHEV and EV World?
BMW Vision Neue Klasse SUV Concept
Hyundai and Kia successfully hit reset with fresh branding like Ioniq and EV. Legacy automakers, however, may prefer a gradual transition to retain brand equity. What’s the best way to bridge the gap between tradition and the electrified future?