From being dogged by a data leak scandal last month to facing the ire of US dealers who want a piece of the Scout pie, it’s been a challenging few weeks for the Volkswagen Group. Let’s not forget that the brand enters 2025, reeling from layoffs as the company attempts to plug an overcapacity crisis in a bid to secure VW’s long-term future.

Things do seem bleak for the second-largest auto manufacturer in the world. Perhaps it was always going to get worse before it got better. And Volkswagen AG realizes that it’s on track to be penalized by some truly monumental fines from the European Union.

A $1.6 Billion Bill Is Coming

Speaking to analysts on a call on Wednesday, VW’s head of investor relations, Rolf Woller, spoke about potential penalties for exceeding the EU’s emissions targets. The company estimates that, if they are to fail in meeting those targets, they’ll be landed with a 1.5 billion Euro ($1.6 billion at current exchange rates) bill.

Read: VW Slashes Manager Bonuses By 10% For Two Years, Plans More Cuts Through 2030

And it’s looking increasingly likely that they won’t be able to meet the EU’s target. Volkswagen didn’t launch any new EVs last year, nor will they offer anything this year. Instead, we’ll have to wait until 2026 until the new ID.2 makes an appearance. Bloomberg relates how Woller also spoke on VW’s shrinking bottom line, which is further eroded by VW having to sell more EVs at the expense of more profitable combustion-engine models.

Meanwhile, demand for EVs across Europe is waning. Despite the increase in electric vehicle sales across the globe, the slowdown in segment growth hasn’t been as anticipated, with key regions such as Germany and Italy slashing EV subsidies. Meanwhile, VW’s existing battery-powered offerings are facing stiff competition from cheaper Chinese alternatives.

Manufacturers Ask The EU To Be Lenient

VW isn’t the only company that has raised the alarm over the European Union’s strict emissions targets. Earlier this year, some of the world’s largest automakers announced they wanted to pool their EU emissions with Tesla in a bid to avoid the proposed fines.

More: Toyota, Stellantis, Ford, And Mazda May Pay Tesla $1 Billion To Avoid EU Emissions Fines

According to documents released by the EU Commission, Toyota, Ford, Mazda, Stellantis, Subaru, and Leapmotor intend to create a ‘Superpool’ with Tesla. Meanwhile, Mercedes-Benz is looking to pool with Smart, Volvo, and Polestar. As of now, VW hasn’t announced any plans to pool with any other manufacturer’s fleets.

For a company that is undergoing some fairly intense restructuring under CEO Oliver Blume, the looming bill from the European Union comes at a somewhat inopportune time. Either way, analysts will be keen to observe how the industrial giant that is Volkswagen AG tackles the next two years.

If you’re on the fence about picking your next new car, safety is likely a significant consideration. And if you’re thinking about switching to an EV from an ICE, you may wonder just how much safer (or riskier) electric cars are over their combustion counterparts. It’s precisely this question that the folks over at ANCAP (Australasian New Car Assessment Program) have been trying to answer, and the results may be surprising.

Armed with data from their own crash tests, ANCAP has ruled that, yes, EVs score proportionally higher on crash tests than ICE vehicles. But that comes with a caveat: namely, the operative phrase being “proportionally higher.”

Read: These Two Cars Managed To Earn A Shocking Zero-Star Safety Rating

Put simply, there are 57 EVs that have been tested by ANCAP, with only six of those falling short of the maximum score. But when it comes to ICEs, the pool is larger: of 117 combustion-powered cars, 18 fail to get full marks.

While statistically there are more five-star EVs than five-star ICE cars that have been tested (around 89 percent vs 85 percent), the difference isn’t that great. There are a few other factors to consider too. Firstly, most electric vehicles are relatively new models. Newer cars equals newer safety tech, which can often swing it in these tests. In addition, most of the EVs that are tested feature a higher MSRP, and will naturally come loaded to the rafters with crash protection.

Meanwhile, fighting in the ICE pool are cheaper entry-level cars that have fallen short of ANCAPs tests, with the Mahindra Scorpio, MG5 (zero stars each), and Suzuki Swift (one star). Three star ICE cars like the Hyundai i30 Sedan, MG3, Jeep Gladiator, and Jeep Wrangler failed to help the cause.

Meanwhile, there are no zero-, one-, or two-star awarded EVs on sale in Australia and New Zealand. The lowest you can get are four star examples, specifically the BMW i4, Hyundai Kona Electric, Fiat 500e, Opel Mokka and Citroen C4 (the last two only on sale in NZ). The sole three-star EV on sale down under is the Jeep Avenger.

Speaking to Drive, ANCAP Chief Executive Officer Carla Hoorweg said that the disparity seen between EVs and ICEs isn’t that big when it comes to overall safety. But when it comes to price, with EVs being more expensive, it just doesn’t make sense to sell a low-scoring electric car: “I would say there’s also probably a factor of play there where… how are you going to go from a sales perspective if you’re bringing a one-star EV into Australia – it’s an expensive product.”

Sales of EVs around the world have been somewhat inconsistent in 2024. While the US and China recorded strong growth, countries in Europe have reported slowdowns, with German sales crashing by 28 percent and Australia reporting similar declines.

Now it seems it’s Japan‘s turn, as in 2024, electric vehicle sales plummeted by a staggering 33%, marking the first decline in four years. With just 59,736 units sold, EVs now account for less than 2% of all vehicle sales in the country – an eyebrow-raising contrast to overall global markets where sales rise, albeit, in some of them, not at the rate initially anticipated by many automakers.

See Also: Carlos Ghosn Claims Japan Forced Honda Into ‘Desperate’ Nissan Merger Talks

A report from Nikkei Asia tells us that Nissan Motor, which dominates half of the country’s EV market, suffered a massive blow. Sales nosedived by 44% to 30,749 units – the lowest since 2021. Toyota didn’t fare much better. Despite a modest 10% bump in sales of its bZ4X (a pricey proposition starting at 5.5 million yen, or $34,755), the automaker’s overall EV sales dropped by 30%. Meanwhile, Mitsubishi Motors recorded a shocking 64% drop in EV sales, while the Honda e was axed and won’t get a successor.

The Reasons Behind Japan’s EV Slump

So what caused EVs to plunge last year? The key reason is hybrids. Japan remains loyal to its hybrid vehicles, which offer fuel efficiency without the higher price tag of EVs. Combined with the limited infrastructure, many consumers still aren’t sold on going fully electric.

Meanwhile, foreign automakers have been quick to spot opportunities in this underperforming market. BYD, the Chinese EV powerhouse, posted a 54% increase in sales, driven by the success of its Seal sedan and the affordable Dolphin EV, starting at just 2.99 million yen.

While BYD still trails local giants like Nissan, its sales are now 40% as high as Tesla’s, which remains the top imported EV brand in Japan. South Korea’s Hyundai also made headway, with EV sales climbing 24% thanks to updates to its Ioniq 5 lineup and plans for a smaller, budget-friendly EV in 2025.

What’s Next for Japanese Brands?

Japanese automakers may have been pioneers in hybrid technology, but their sluggish response to the EV boom is proving costly. Foreign brands are stepping in to fill the gap, both locally and worldwide, capitalizing on price-conscious buyers and offering models that are competitive in both cost and tech.

For now, hybrids continue to dominate Japan’s roads, but the winds of change are blowing. As EV sales were up 25% up globally in 2024 vs 2023 and are projected to rise by 30% this year, while at the same time international players like BYD and Hyundai push harder, Japanese brands may need to rethink their strategy, or risk being left in the rearview mirror.

Hot on the heels of the company’s retro-name revival that has already included the likes of the Integra and the Honda Prelude, Acura has announced the comeback of the RSX. The catch? Well, it’s nothing like the RSX you might remember from your early 2000s daydreams.

This time around, the new RSX adopts an SUV body and will be Acura’s first model to ride on an all-new dedicated EV platform. Unlike the Acura ZDX, which borrows its underpinnings from General Motors, the RSX will ride on Honda’s newly developed in-house EV architecture, a significant step forward for the automaker’s electrification plans.

Read: Acura Plots Electric Future To Reverse Declining Sales And Reignite Brand Appeal

The introduction of the RSX is part of Acura’s plans to claw itself back up the sales charts. The automaker lost market share to competitors in 2024, as multiple models recorded double-digit drops in 2024. This will be only the second production EV to appear with an Acura badge on it, with executives highlighting the need for more battery-electric offerings.

A New EV Platform From Honda

The Honda-developed EV platform has already been shown off at CES 2025, underpinning the Honda 0 Series Saloon and SUV prototypes that will evolve into production models next year. Honda’s aim with its new EV platform will be to create lighter vehicles, as well as to reduce the overall height that most EVs require to fit their batteries inside the floor.

The new Acura RSX will also be the first EV produced at Honda’s new “EV Hub” in Ohio. The facilities at the Marysville Auto Plant, the East Liberty Auto Plant, and the Anna Engine Plant are undergoing a $700 million makeover and retooling. The Anna Engine Plant will be where the megacasting for Honda’s new Intelligent Power Unit (IPU) is made.

The IPU is a big step forward in Honda and Acura’s ambitions for EVs, serving as an integral part of the new EV platform. It’s also much larger than anything that Honda has die-cast before, and the initial development in North America, using domestic and globally sourced parts, is a win for American manufacturing.

Coupe Dreams Dashed

When news broke that the RSX name had been trademarked, first in Japan and then in the U.S., many predicted that the reborn nameplate would be affixed to a sporty coupe. Although the Integra nameplate has been revived, the fact that it’s attached to a four-door sedan rather than a sporty coupe has been a sore point for longtime fans of the brand. The fact that Honda has revived the Prelude name even made some wonder if the new Acura RSX would be a more premium riff on the new coupe.

See: Honda Trademarks RSX Name In Japan, Is Another Icon Returning?

Instead, Acura takes a leaf from Mitsubishi by turning one of their beloved coupe nameplates into an SUV. When asked by CarScoops as to why the company opted to revive the RSX name for an electric SUV and not a sports car, a spokesperson said, “We believe RSX is the right name for our new all-electric SUV. This isn’t a “revival” of the previous RSX coupe. Globally, that model was sold and marketed as Integra, and we have seen resounding fan enthusiasm for the 5th gen Integra  — especially with the Type S.”

The RSX is said to take inspiration from the speedboat-like Performance EV Concept. From the one image we’ve been furnished with, it appears the new model retains some of the elements of the concept but goes for an overall more conventional approach.

The dramatic NSX-inspired rear appears to have given way to something more reminiscent of a BMW X6 or Tesla Model Y. Meanwhile, the coupe-like roofline has been profiled to be, well, less coupe-like. Still, it’s early days.

Acura hasn’t confirmed a firm on-sale date, but prototypes of the all-electric RSX will begin real-world testing this week. What we do know is that it’ll be the first car from either Honda or Acura to be built on the new EV platform at the Ohio EV Hub, so expect to start seeing the new RSX in showrooms in early 2026.

Everyone loves a good “breakthrough” headline about electric vehicles, especially the kind that promises they’ll finally stop costing as much as a mid-sized house in Ohio. Well, here’s one for you: according to a new study, the price of lithium batteries has fallen greatly, recording the most significant drop in seven years. The need for cheaper batteries is often cited as one way to speed up adoption, with experts waiting for EVs to achieve price parity with combustion vehicles.

Lithium-ion battery pack prices have cratered thanks to an oversupply of cells, as well as lower prices for the raw metals and other components used in manufacturing. The BloombergNEF survey covered 343 data points, encompassing electric cars, buses, and commercial vehicles.

Price Parity By 2026

The quest for electric vehicles to become as affordable as their internal combustion engine counterparts will be the true litmus test for widespread adoption. If the trend we’ve witnessed this year continues, we could see the much-vaunted price parity between electric vehicles and gas-powered cars becoming a reality for consumers as soon as 2026.

See: GM Sells $1 Billion Stake In Joint Battery Plant To LG

Currently, the average cost of a battery pack sits at $115 per kWh — a 20 percent decline from last year. Pricing will need to drop by $15 to $100 per kWh for that magical price parity, although according to the report from Bloomberg, that’s already happened in China, with some EVs selling for cheaper than their combustion counterparts.

There’s Still Some Way To Go

While BNEF predicts battery pricing will drop below $100 per kWh by 2026 and down to $69 per kWh by 2030, there are geopolitical and macroeconomic factors that may further impact these projections.

However, there will still be a “chicken and egg” situation, where the production of EV cells remains heavily dependent on car sales. While there has been an oversupply of cells recently, partly due to a slowdown in EV sales growth in some markets, manufacturers may begin to reduce production as a result, too.

Government Actions and Tariffs Threaten EV Progress

There are also other factors that may affect the road to price parity. European governments are slashing their EV subsidies, which, in Germany at least, has led to a significant drop in sales for 2024. Meanwhile, in the US, incoming President Donald Trump has threatened to impose 60% tariffs on Chinese imports and 10%-20% tariffs on those from other countries. His transition team is also pushing for Congress to repeal the $7,500 electric vehicle tax credit. If successful, this could severely impact most automakers, even though Musk believes it may ultimately benefit Tesla.