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Mar 18
Chinese automakers navigate North America but face 2027 compliance barriers
Despite multiple tariffs and policy barriers imposed by the US on China's auto industry, Chinese automakers have avoided directly confronting the restrictions. Instead, they are adopting an indirect strategy, using Canada and Mexico as forward bases for entering the North American market. However, the real challenge is expected to emerge starting in 2027, when US compliance requirements for connected vehicle software and hardware will become an obstacle to overcome.
Japan's Honda Motor Co. stunned investors in March 2026 by announcing up to JPY2.5 trillion (approx. US$15.8 billion) in impairment losses tied largely to its troubled push into electric vehicles, underscoring how even one of the industry's most storied innovators has struggled to navigate the global shift away from gasoline engines.
US government disclosures have shed unusual light on a closely guarded corner of the electric vehicle supply chain, confirming that LG Energy Solution signed a battery supply agreement worth KRW6 trillion (approx. US$4 billion) with Tesla in July 2025.

Buffeted by a slower-than-expected shift toward vehicle electrification and electronic architectures—along with the crosscurrents of tariffs and inflation—the global auto market turned in a muted performance in 2025. Yet even as layoffs and restructuring swept through many Western suppliers, Europe's and America's legacy Tier 1 manufacturers managed to hold margins steady, revealing a survival strategy built on internal austerity and external reinvention.

China's auto market is undergoing a sharp realignment in early 2026, as the phaseout of government subsidies exposes deeper competitive strengths — and weaknesses — among the industry's leading players.
As major battery manufacturers accelerate the commercialization of solid-state batteries (SSBs), South Korea's battery materials industry is also speeding up product development and production, targeting the emerging demand. Efforts now span multiple areas, including cathode and anode materials, SSBs, and key raw materials. Observations from the show floor at InterBattery 2026 indicate that South Korean materials suppliers are advancing toward mass commercialization through cross-company collaboration and vertical integration.
Horace Luke, the former Nike designer and Microsoft creative director who founded Gogoro in 2011 to revolutionize electric scooters, has reportedly accumulated debts of about NT$150 million (approx. US$4.7 million) and is currently unreachable. This situation has prompted Ruentex Group chairman Samuel Yin to launch an investigation into Luke's overseas assets.
Taiwan's leading automotive power and safety component supplier, Global PMX, has been accelerating its expansion into the fast-growing AI server market while simultaneously advancing into high-value semiconductor and smart medical products. Several new offerings have already entered mass production and shipment, and with additional overseas capacity set to come online, the company is positioning for stronger operational growth ahead.

As Formula One (F1) prepares to introduce new power unit regulations in 2026, the sport faces its most dramatic technical transformation in decades. Recent reports also suggest that Chinese automaker BYD is considering an entry into F1, adding fresh intrigue to the ongoing shift. If confirmed, it would mark the first time a Chinese car brand has formally challenged the "pinnacle of motorsport," and further signals the sport's changing focus, going from raw engine output to sophisticated energy management.

The Formula One (F1) season opened in Australia with a spectacle that was meant to inaugurate a new technological era. Instead, it quickly became a showcase of dominance by one team.

Global PMX released a positive outlook, identifying semiconductor- and AI-server-related businesses as its main future growth drivers, while signaling a gradual decline in its formerly dominant automotive segment. The company said it has actively optimized its product mix as global industry structures adjust.
Although automotive component manufacturer Kwang-Hwa Electronic's primary shipment markets remain China and North America, revenue growth in the US and Mexico has been significant in recent years. Combined revenue from the two regions has increased by more than 25% year-on-year, indicating that the company's overseas capacity expansion is gradually taking effect and helping to ease the pressure from persistent price competition in the Chinese market.