Musk's AI Gambit, Ford's Electric Future, And Hertz's EV Woes Shake Up Auto Industry

In today's car news, several significant updates have emerged from the automotive industry, including strategic decisions by major companies, a tragic accident, and the impact of market trends on consumers and businesses alike.

Elon Musk's AI company, xAI, has taken a groundbreaking step by open-sourcing the base code of their Grok AI model. This decision allows for commercial applications and the potential for other companies to adapt and enhance the technology. This move by xAI, following in the footsteps of industry giants Meta and Google, places Musk at the center of ongoing legal disputes with OpenAI, related to the latter's commitment to nonprofit AI objectives.

Adding to the industry's developments, Ford has unveiled plans to manufacture its forthcoming electric F-150 pickup truck at the iconic Rouge plant in Dearborn, Michigan. The move signifies Ford's commitment to the electrification of its fleet, with the electric F-150 anticipated to significantly impact the market upon its 2024 release. In an effort to bolster EV production, Michigan legislators have passed a tax exemption for certain manufacturing components, aiming to attract more EV investment to the state.

The automotive world was recently jarred by the death of billionaire Angela Chao, who tragically drowned after her Tesla Model X plunged into a pond on a Texas ranch. This incident has shone a spotlight on ongoing concerns regarding Tesla's gear shift design in models outfitted with touchscreen interfaces since 2021. The confusion between drive and reverse options has led to several complaints filed with the US Department of Transportation, raising questions about the safety of Tesla's intuitive controls.

Market dynamics are affecting the used car industry as declining prices have triggered an increase in negative equity trades. A study by Edmunds highlights how consumers burdened with oversized loans are finding their trade-ins undervalued, especially newer models that suffer the most from depreciation. Despite these challenges, the study identifies potential savings in luxury vehicles and large SUVs for buyers with more flexible budgets.

Concluding the series of updates, Hertz has announced the resignation of CEO Stephen Scherr following challenges encountered with the company's electric vehicle fleet. Having invested in an expansive fleet of EVs from Tesla, Polestar, and GM, Hertz faced unforeseen costs related to repairs and a lukewarm reception from renters. The decision to offload 20,000 EVs has resulted in considerable financial losses for Hertz, mirroring the struggles of other rental firms like Germany's Sixt, which have also reduced their EV holdings.