There was no shortage of stunning displays of innovative automotive and mobility technology in the West Hall of the Last Vegas Convention Center at this year’s CES.
There was, for example, an “All-Weather Camera” on LG Innotek’s concept vehicle that spins so fast the company claims it can shed rain, snow, ice and grime. And then there was Kubota’s KATR – a four-wheeled all terrain, multifunctional robot – and giant earth moving construction vehicles like the fully electric backhoe on display by Komatsu.
But the excitement and exuberance about the latest technological advancements in the automotive and mobility industry that was visible on the show floor was at odds with uncertainty.
The companies creating the most buzz were not the legacy automakers or even the start-up EV companies that have turned the Las Vegas Convention Center’s West Hall into its own auto show over the past 10-15 years.
This year, the biggest buzz came from chip makers like Nvidia and Qualcomm instead of legacy automakers like Honda and Toyota that held press conferences.
Perhaps the biggest buzz, at least in automotive, was Nvidia’s CEO Jensen Huang’s keynote speech. Held at Mandalay Bay, thousands of attendees lined up more than an hour before he spoke.
“It’s Nvidia’s world and we’re all just living in it,” Automotive News proclaimed in its headline after Huang unveiled Nvidia Cosmos, a platform that can predict and generate physics-aware videos of future virtual environments to help developers build autonomous vehicles.
Meanwhile, Qualcomm Technologies revealed a flurry of automotive partnerships with automakers, and Intel also announced several new automotive partnerships, as well as a new family of AI-enhanced system-on-chips (SoCs) for intelligent EV energy management.
Announcements by legacy automakers seemed to fall flat. Toyota provided an update on its Woven City – a “living laboratory” where people can live while also testing out futuristic projects built at a former car factory in Japan. But that was an update on its original announcement in 2020 and it does not open until later this year.
The Afeela 1, an electric vehicle produced by a joint venture between Sony and Honda, was revealed at CES with prices of $89,900 for the Origin and $102,900 for the Signature. But with those price tags, some journalists wondered if the cost will be too high to generate substantial sales volumes.
Meanwhile, the domestic automakers – Ford, General Motors and Stellantis – were all absent for the second year in a row, at least as major exhibitors.
Off the show floor at networking events across the city the excitement gave way to concern about the future direction of the industry. The question I was asked repeatedly at several cocktail parties was some version of: “So, what does 2025 look like to you?” Or “What are you watching right now in the auto industry?”
Typically, these questions were asked in a sort of nervous, hushed voice that revealed a sense of foreboding.
At Franco, I would tell them, we are coming off a successful year and we are thankful to be entering the year in a strong position. But, in my next breath, I would say I am not blind to a range of industry challenges that are crashing down on the automotive industry from different directions – and I am worried about the future.
Right now, legacy automakers and suppliers are reeling from over-investing in EVs and autonomous vehicles in recent years for market demand that didn’t materialize at the anticipated levels. That has forced the industry to pull back on investment just as Chinese automakers are flooding Europe with EVs priced far below what traditional automakers can sell EVs for and still make a profit.
The need to recover from an over-investment in EVs is occurring just as another trend – the need to develop better software platforms to support true software defined vehicles – is exploding as the next frontier.
On top of that, the industry doesn’t know how far incoming President Trump will really go with his threat of imposing steep tariffs on imports or if/when the incoming administration will roll back tariffs. While tariffs could spur a boom in U.S. auto production, they could also create a tremendous amount of complications and costs for the domestic auto industry.
As Jamie Butters, executive editor of Automotive News, said in his column from CES:
“Automakers have been largely paralyzed for the last half year or more, waiting to see which political direction the U.S. was going to go. And even now, they don’t really know what the policies will be on trade, on EVs and on fuel economy standards.”
One industry veteran who has attended CES more than 20 times but hasn’t attended in several years said she was shocked by what she described as a complete transformation of the show floor now dominated by Chinse and tech companies.
Patrick George, editor of Inside EVs, declared in this excellent analysis of Chinese vehicles on display that Chinese automakers “only needed to bring their actual cars to CES and not just far-off concepts,” to impress crowds. “Zeekr, Great Wall Motors and others have cars on sale right now that the rest of the industry is trying to ‘catch up’ to. And CES is proof.”
Hopefully, the 2025 show is a temporary lull. The domestic automotive industry has proven over and over again that it is resilient. It has survived increased competition from the Japanese automakers, Koren automakers, startups, the Great Recession and, most recently, the global pandemic.
A year from now when I return from CES I am hopeful I can report that the industry is poised to bounce back with a renewed sense of optimism.
Brent Snavely is Vice President of Media Relations at Franco. Connect with him on LinkedIn.
