The 3 Major Hurdles Keeping the Auto Industry Stuck in Gear

Good morning! We’ve officially entered the season of company holiday parties. An etiquette expert shared some helpful tips to follow. (Take it easy on the booze.)

In today’s big story, an automaker CEO’s resignation shows how tough a year the industry is having.

What’s on deck:

But first, I’m just trying to get out of first gear.

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The big story

Running on fumes

As dealerships look to clear their lots to make room for next year’s models, automakers are also doing some housecleaning.

Stellantis CEO Carlos Tavares resigned this weekend as the Jeep and Chrysler owner battles sliding sales. His expedited departure — Tavares was scheduled to leave in 2026 — shows how choppy the automotive industry remains.

Stellantis’ struggles have been particularly bad. Tavares’s cost-cutting approach initially helped, but more recently the company’s US sales were down 17% this year compared to last year, writes Business Insider’s Nora Naughton.

The new boss will have plenty of issues to sort through, including a legal battle with the United Auto Workers union, writes BI’s Tom Carter.

So, what’s got the auto industry stuck in gear?

There are three big issues at play here:

The EV problem: Arguably the biggest issue facing automakers is slowing demand for electric vehicles. While EV sales are still rising, they aren’t pacing how they were a few years ago. That’s forced automakers to recalibrate strategies that were anticipating the EV good times would keep rolling. Hybrid cars are also making a comeback, further complicating plans.

The China problem: As if the EV market wasn’t hard enough, there’s the added challenge of Chinese competitors gaining market share. Their budget-friendly EVs are proving to be a huge hit in the world’s largest auto market (China), much to the annoyance of Tesla. They also turned heads at Europe’s largest auto show this year. Even Ford CEO Jim Farley acknowledged how much he enjoyed a Chinese EV. (It hasn’t been a complete lovefest; he also called China’s auto industry an “existential threat.”)

The tariff problem: President-elect Donald Trump’s surprise announcement to enact a 25% tax on goods imported from Mexico is the newest hurdle for automakers. The US imported more than $65 billion worth of car parts from Mexico last year. Tesla also previously announced plans for a new $10 billion factory in Mexico. Trump’s trade plans might not ultimately be implemented, but the uncertainty means car manufacturers could reconsider their supply chains.

News brief

Top headlines

3 things in markets

1. Balyasny tops among multistrat giants last month. The Chicago-based fund posted a 3.9% gain in November, pushing its year-to-date performance to 11.6%. Check out how other top hedge funds like Citadel, Millennium and Schonfeld Partners fared.
2. What does “de-dollarization” even mean? President-elect Donald Trump recently threatened countries that are trying to move away from using the US dollar as a reserve currency. “De-dollarization” is about trying to reduce reliance on the dollar in cross-border trade and investments, undermining the US along the way.
3. Explaining BlackRock’s latest big push into private credit. The massive money manager announced plans to acquire HPS Investment Partners, a private credit behemoth managing $148 billion, for $12 billion. The deal shows how BlackRock sees big opportunities growing its business in the lucrative private markets.

3 things in tech

1. Elon Musk’s Tesla pay package gets shut down — again. A Delaware judge decided against reinstating Musk’s $55 billion pay package despite shareholders approving it in June. The judge, who had previously ruled to void the agreement in January, stuck to her earlier finding that Tesla’s board was unduly influenced by Musk when it came to creating his compensation package. Musk wrote that the ruling was “totally crazy” and “absolute corruption” in posts on X.
2. Intel tries to regroup after its CEO’s surprising exit. Intel’s top boss Pat Gelsinger stepped down as the US chipmaker looks to right the ship and reverse a massive slide in its stock price. The company’s interim co-CEOs addressed the workforce Monday in what one Intel employee described as “damage control.”
3. Exclusive: Amazon plans to ramp up cloud work by leveraging consultants. Amazon Web Services wants to work with more consulting services, like Accenture, as part of its broader goal to spur growth, according to an internal document. It’s a notable shift, as AWS previously has done a lot of work with customers through in-house cloud advisors.

3 things in business

1. The secret to eliminating some of the guesswork out homebuying might be Down Under. About a third of homes sold in Australia are done by auctions giving sellers and buyers a clearer picture of how the winning bid is reached. Some companies are trying to bring the US a version of the approach.
2. Why Netflix could raise prices again — and soon. Some on Wall Street think the streaming giant will raise prices soon to keep its growth going. New survey data from Evercore ISI suggests it has room to do so. Almost half of the respondents said they’d be more likely to keep Netflix if more live content — like the Jake Paul and Mike Tyson fight — was added.
3. How Disney’s ‘Moana 2’ won at the box office. The sequel to the 2016 movie hit broke Thanksgiving box office records and brought in $380 million globally. Its success was much needed for Disney, but none of it would have happened if the company kept its original plans to make “Moana 2” a Disney+ series. It’s now Disney’s “hottest IP.”

What’s happening today

• Today is Giving Tuesday, where people around the globe celebrate generosity.
• Salesforce reports earnings today after the bell.
• Billboard reveals the top pop star of the 21st century.

The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Grace Lett, editor, in Chicago. Ella Hopkins, associate editor, in London. Spriha Srivastava, UK bureau chief, in London. Amanda Yen, fellow, in New York. Milan Sehmbi, fellow, in London.