The auto industry keeps discovering that yesterday's product plan is today's balance-sheet charge.
In today's issue:
Honda drops its 2040 combustion-free target after its first annual loss since listing in 1957
Tesla unredacts 17 autonomous crash reports it had marked confidential
VW puts the GTI badge on an EV, and the specs say it earns it
TARIFF MATH
Honda Posts Its First Annual Loss Since Listing, Then Kills the EV Roadmap
Honda reported an operating loss of JPY 414.3 billion (approximately $2.6 billion) for FY25, ending March 2026, versus an operating profit of JPY 1,213.4 billion the prior year, per Just Auto.
Total EV-related write-downs reached approximately $9 billion, per Ars Technica Cars; the Automotive News Daily Drive podcast put the figure at "nearly $10 billion."
Honda's CEO formally abandoned the company's 2040 combustion-free goal, per EV News Daily, and over the next three years will invest 4.4 trillion yen ($27.8 billion) in new gasoline and hybrid vehicles and 1 trillion yen in software, per Wards Auto.
Honda framed the pivot as a response to market conditions, but U.S. EV sales dropped 28% in the first part of 2026, per Ars Technica Cars, a collapse driven by the removal of federal clean-vehicle tax credits and tariff disruption: the same policy environment Honda approved its EV spending plan inside.
Buyers waiting for Honda EVs now face a product gap measured in years, not months; Automotive World notes the financial recovery "will likely take several years."
Five outlets confirmed the core loss figure, and the spread between the $2.6 billion operating loss and $9 billion in EV write-downs tells the rest: Honda booked the write-downs separately from operating results, meaning the headline number undersells how much the EV program cost. The CEO's concession that the 2040 goal is gone is the clearest sign that this is a strategy reset, not a pause.
Also worth knowing
Tesla unredacted 17 ADS crash narratives: Tesla had been the only autonomous driving system operator to fully redact every crash narrative filed with NHTSA, labeling each one "confidential business information." The company quietly reversed that, per Electrek, revealing what happened across all 17 incidents; separately, Teslarati and TechCrunch Transportation confirmed two low-speed Austin crashes involving teleoperators with no passengers aboard. #news
Subaru's profit fell 90%, EV production delayed: Subaru took a $362 million charge and postponed its independently developed EV program in Japan, per Automotive News, as tariffs compounded slowing demand. The Japanese marque also posted a 1.42 billion dollar overall hit, per Autoblog, with EBIT collapsing in Q4. Autoblog notes Subaru's electric future now depends on Toyota's platform longer than planned. #analyst
Inventory gap: Dodge sits at 142 days, Toyota at 36: New-vehicle lots are 93% model-year 2026 stock following a 36% month-over-month drop in remaining 2025 units, per CBT News. Incentive spending nationally fell to 6.9% of ATP. The spread between Dodge's 142-day supply and Toyota's 36-day supply is one of the widest brand-level gaps on record and reflects two entirely different demand realities. #market
Porsche class action targets dealer-only repair lock: A federal lawsuit filed after a Cayenne owner couldn't get an independent shop to reset an oil service light claims Porsche effectively forces owners into dealer-only repairs, per Road and Track. The case argues this amounts to an illegal repair monopoly, and the specifics are sticky: a software-locked service indicator after a routine oil change is the trigger. #news
DOJ subpoenas Apple and Google over OBDII tuning app: The Department of Justice ordered both companies to hand over data on at least 100,000 users who downloaded the EZ Lynk Auto Agent app, per The Drive, as part of an ongoing emissions-defeat probe. The DOJ originally sued EZ Lynk in 2021; this subpoena pulls consumer app-store records into a federal enforcement action for the first time. #news
What's new
VW ID Polo GTI: the first electric GTI: Volkswagen revealed the ID Polo GTI with a 166 kW (223 bhp) front-mounted motor, an electric limited-slip differential, an adaptive chassis, and a dedicated GTI drive mode, per Autocar UK. The 1,540 kg hatch hits 0-100 km/h in 6.8 seconds and tops out at 200 km/h, per CarExpert. VW's technical chief called it "a sports car you can use every day."
Rivian R2 configurator goes live: Reservation holders can now spec the R2, with the Performance trim starting at $57,990, just $890 below Tesla Model Y Performance, per Electrek. Deliveries for the Performance launch package are "one to six weeks" out, per the Electrek podcast. Autoblog notes fully loaded examples can push toward $65,000.
Recalls & legal action
Waymo recalls 3,791 robotaxis after one was swept into a creek: A San Antonio Waymo detected a potentially untraversable flooded road but slowed instead of stopping, then was swept away, per NHTSA filings and TechCrunch Transportation. The recall covers vehicles running Waymo's fifth- and sixth-generation automated-driving systems. Separately, Dunne Insights reported that Waymo's own CEO elided at least 19 documented incidents of robotaxis driving past school buses with active stop-arms.
Jeep Cherokee PTU recall covers 61,711 vehicles: Stellantis is recalling 2019-2023 Jeep Cherokee (KL) SUVs over a power transfer unit failure that can cause loss of drive power or allow the vehicle to roll while in Park, per MoparInsiders.
Quick links
Cadillac ATP up 11% in April: Cadillac's average transaction price rose 11% year-over-year in April 2026, outpacing the broader market, per GM Authority. The broader new-vehicle CPI was flat at 179.174 in April (FRED).
Uber investing $10B+ to compete with Waymo: Uber is publicly criticizing its own robotaxi partner while building an autonomous fleet with Rivian, Lucid, and Nuro, per Electrek, in one of the more visible partner-vs-partner moves in the AV space.
Alpina Vision grand tourer concept revealed: BMW's newly absorbed Alpina sub-brand showed a concept previewing the brand's future direction under full BMW ownership, which began at the start of 2026, per Autocar India. No production car will follow directly.
Indianapolis 500 qualifying underway: Day 1 of qualifying for the 110th running of the Indy 500 ran May 16, with real-time updates tracked by Frontstretch. Race week marks the largest single-day sporting event in North America by attendance.
Sources: Just Auto · Ars Technica Cars · Wards Auto · EV News Daily · Automotive News Daily Drive · Automotive World · Electrek · Teslarati · TechCrunch Transportation · Automotive News · Autoblog · CBT News · Road and Track · The Drive · Autocar UK · CarExpert · Electrek (R2) · Autoblog (R2) · TechCrunch Transportation (Waymo) · Dunne Insights · MoparInsiders · GM Authority · Electrek (Uber) · Autocar India · Frontstretch