EV and Auto Transition: Program Risks and Recovery Forecasts
QuantumScape expanded its warning about automaker program cuts, suppliers described production and cost pressures, and Aspen later outlined an industry recovery outlook.
The solid-state battery developer QuantumScape Corp (QS) expanded its EV adoption warning in July, explicitly saying automakers may delay, reduce or discontinue development programs, battery procurement, capital spending or technology collaborations, potentially delaying commercialization of its technology. Its April discussion cited European plant closures and layoffs in 2024. July also cited automakers that had delayed, scaled back or discontinued EV programs and models.
Customer program changes had already affected the business of component supplier Methode Electronics Inc (MEI). The company said in June that certain automakers had significantly deferred or cancelled planned EV programs or reduced production below previously quoted levels. Methode said it had pursued, and continued to pursue, price adjustments and other commercial recoveries for upfront program costs. In September, it warned that slower-than-anticipated adoption and customer strategy changes may cause underutilized capacity and workforce disruptions if it cannot redeploy excess capacity.
The thermal-barrier supplier Aspen Aerogels Inc (ASPN) linked lower-than-anticipated adoption in May partly to regulatory and incentive changes and evolving consumer demand. Automakers had adjusted production plans and investment timelines, resulting in revised capacity plans and retimed EV investments, particularly in North America. Aspen expects thermal-barrier revenue to continue declining in 2026 compared with 2025, primarily because of lower anticipated production volumes. It also said customers' cost-reduction and redesign initiatives may require engineering changes to supplied components.
The vehicle retailer Sonic Automotive Inc (SAH) made consumer preference more explicit in July. April's explanation of weaker battery-electric gross profit per unit centered on excess inventory; July named higher inventory days' supply, higher average prices and consumer preference for hybrids. Sonic said battery-electric sales reduced total average new-vehicle gross profit per unit by approximately $125 in year-to-date 2026. Its description of combined hybrid and plug-in hybrid sales penetration also changed from exceeding battery-electric penetration in April to “nearly 4x” in July, when it explicitly said battery-electric penetration was declining.
The EV maker Lucid Group, Inc. (LCID) broadened its consumer-risk language in August, adding “value” to perceptions about its vehicles, cost to the availability of alternative-fuel vehicles, and reliability to service considerations. The EV maker Rivian Automotive, Inc. / DE (RIVN) described price competition attributable partly to political and general economic conditions. Rivian said competitors' production-plan changes, price reductions and incentives may continue to exert downward price pressure, and its own pricing adjustments would have a greater business impact than adjustments by competitors with greater financial resources.
The EV-charging company ChargePoint Holdings, Inc. (CHPT) softened its description of North American new-EV sales between June and September: “a substantial decline” became “declines.” It also changed the comparison from the same quarters a year earlier to “prior periods.” Both accounts linked the sales weakness to termination of the federal EV tax credit in September 2025. ChargePoint retained its warning that manufacturers' delayed or modified electrification plans could constrain adoption and prevent the charging market from developing as expected.
The electricity company Edison International (EIX) emphasized continuing California adoption in July, citing zero-emission vehicles at about 18% of new-car sales in January–May. Its April update had cited about 14% for January–February; the figures covered different periods. Edison continued to say SCE's Charge Ready programs are expected to stimulate adoption and charging construction, including at multifamily dwellings and in disadvantaged communities. It retained an outlook under which EV electricity use in SCE's service area could exceed 50,000 GWh by 2045.
Aspen moved from May's account of retimed investments to an industry stabilization outlook in September, saying demand was improving as inventories normalized and production was expected to recover from the 2026 trough. The company projected North American battery-electric vehicle production growth of about 20% annually through 2030 and said awarded European programs supported significant growth potential in 2027.