Happy Friday and welcome to Critical Materials, your source for the biggest stories shaping the future of the auto industry.

Every Friday, we break down the week’s biggest EV news, keep you up to speed on the cars we’re testing, and recap must-read stories from around the web on driverless cars, batteries, charging, and more.

– Today’s email was written by Suvrat Kothari, Rob Stumpf, Tim Levin, and Andrei Nedelea.

Tesla reported its first-quarter vehicle deliveries this week. And while things look better than they did a year ago, stepping back a bit shows clearly that Tesla’s car business continues to struggle. That’s not great for the EV world as a whole. 

First, the numbers. Elon Musk’s automaker delivered 358,023 vehicles globally in the first three months of the year. As usual, the Model 3 and Model Y accounted for the lion’s share of sales: 341,893 versus 16,130 for the Model S, Model X, and Cybertruck combined. (Both the S and X were discontinued globally on Wednesday, one day after the quarter ended.)

Overall, deliveries rose 6.3% as compared to the first quarter of 2025. Production came in at just over 408,000 vehicles for the quarter. 

So, what can we take away from all of this? 

Clearly, sales rising year over year is better than the alternative. But at the beginning of 2025, Tesla posted its worst deliveries in over two years. Remember, that was the era of Musk running DOGE and weekly Tesla Takedown protests. The company was also changing over its production lines around the world to make the refreshed Model Y, and the numbers reflected that. Deliveries in the quarter dropped 13% on a year-over-year basis. Not exactly a great benchmark to measure against.

It also looks like Tesla’s new, more basic Model 3 and Model Y aren’t helping much. They weren’t what investors or Tesla fans expected when the company repeatedly vowed to roll out “more affordable models.” A truly new product, like the long-fabled Model 2, would have likely done more to lift sales and insulate Tesla against the end of the EV tax credit. But Musk is all-in on robots and autonomous cars instead. 

The differential between cars delivered and produced is another troubling sign. As multiple outlets pointed out this week, Tesla made about 50,000 more vehicles than it delivered last quarter, a new record. This suggests weak demand.

I believe Tesla’s soft sales and its failure to keep its momentum going with new models has repercussions across the EV industry. 

Years ago, companies from GM to Volvo to Volkswagen announced audacious, expensive plans to become EV leaders in part because they could see the regulations were going that direction. But they also had Tesla threatening to eat their lunch, dinner, and breakfast. The Model 3 proved EVs could tap into the mass market, and the Model Y was a runaway hit after it launched in 2020, eventually becoming the world’s best-selling vehicle of any kind. 

But over the last couple of years, Tesla’s stagnation has relieved some of the competitive pressure. Sales have been flat to down, and the only all-new model in recent memory was the Cybertruck. We all know how that’s gone. 

So yes, many car companies are canceling EVs, delaying new ones, and trimming production, putting a damper on the U.S. EV market’s growth. I’ll recap Q1’s EV sales in more depth next week, once the rest of the sales reports come out. 

But can we blame the pullback solely on the looser fuel-economy regulations, the end of the tax credit, and softening EV demand? Or is it that the industry’s primary disruptor has moved on? I think both are important factors here. 

-Tim Levin

Get up to speed on the news that caught our eye this week:

First-quarter sales numbers are rolling out and things aren't looking great. High vehicle (and fuel) prices have consumers watching their spending—that means a renewed fixation on affordability has surfaced across the industry.

One winner of Q1: the Toyota bZ. The crossover is on pace to be America’s favorite non-Tesla EV in so far this year.

The downturn in EV sales and loss of the $7,500 tax credit aren't stopping the wave of electric cars on the U.S. Kia, GM, Toyota, and others took time at the New York International Auto Show to reassure consumers that EVs are still a priority.

At the show, Subaru revealed the Getaway, a three-row EV with over 300 miles of estimated range. On this week’s Plugged-In Podcast, Mack, Tim, and Suvrat recapped the New York auto show’s big reveals.

Mercedes-Benz is the latest automaker to try out steer-by-wire and the yoke-style steering wheel and we got to try it out. Its engineers described it as "lazier" than a traditional mechanical wheel, but they're right—in a good way.

If you're a rideshare driver and feeling the effects of high gas prices right now, there's some good news. Uber is expanding its $4,000 grant for drivers who switch from a gas car to a new EV.

Tesla sales are rebounding, though not nearly as quickly as expected. Now it's sitting on nearly 50,000 unsold cars as it prepares to phase out two of its most iconic models.

Volkswagen wants to put its secret sauce back into its EVs. The brand says that it will be bringing back real names to its ID-line of cars and that physical controls are a "non-negotiable" moving forward. It also confirmed to us that the quirky ID Buzz isn't really on a pause—and that a special adventure version may be coming.

Xiaomi's CEO hosted a 3.5-hour-long livestream where engineers tore down the new Xiaomi SU7 to the component level, showing off all of the innovative ways that the brand-new carmaker has put into the refreshed version of its Tesla fighter.

Robotaxi companies are tight-lipped about how often their vehicles need remote help from human assistants.

A major outage reportedly slammed Baidu’s autonomous taxi service in China. The Apollo Go taxis froze in the middle of highways, and some passengers reported being trapped inside vehicles for over an hour.

The future of EV charging is here—it’s just not evenly distributed. BYD has already built 5,000 of its next-generation 1.5-megawatt charging stations. These can fill the right car from 10%-97% in just 9 minutes.

-Rob Stumpf

We drove the Kia EV3 for the very first time in Seoul back in September 2024, and we loved it. But would this charming little EV actually make it to the U.S.? After a bit of a delay, Kia confirmed that the EV3 will hit American dealerships this year. 

The good news: It means another appealing, long-range and (potentially) affordable electric car is on the way. The less-good news: We don’t actually know how much it will cost quite yet, or if it’ll hit the $35,000 price point Kia initially targeted.

I checked out the EV3 at the New York auto show and came away impressed. It feels friendlier and more welcoming than the EV6, whose swoopy, off-beat design has proved polarizing. The EV3 has the kind of traditional two-box shape that Americans love.

"We're really trying to take our proven EV technology you've seen on the EV6 and EV9 and distill it into a smaller and more affordable package," Joshua Kim, manager of product planning and strategy at Kia America, told me at the show. 

The EV3 is a baby EV9 with up to 320 miles of Kia-estimated range, available all-wheel drive, bidirectional charging, and a Tesla-style NACS plug for seamless Supercharger access. The base model will get more like 220 miles, Kia says. It is indeed smaller than its siblings, but I don’t think it’s too small either. I’m 5'7" and Maddox Kay, our social media manager, is 6'2". We were both perfectly happy with the headroom and legroom in the back. 

You can check the full details here, and stay tuned for my walkaround video dropping soon on the InsideEVs YouTube channel.

The EV3 looks promising. But does it actually have a clear path to success in the U.S.?

Kia first announced the EV3, and that attractive starting price, before Trump’s tariffs came along. Kia officials said the price and production location for the U.S. market EV3 were yet to be determined. The automaker has a large plant in Mexico, so that’s one option if it doesn’t want to import from South Korea.

I think the EV3 could be a genuine hit at the right price. The bigger EV6 has been a sales disaster for several quarters now. Kia moved just 883 EV6 units in Q1 as it prioritizes non-EVs built at the same factory. The company should kill that crossover and redirect those resources toward the EV3 instead. 

The evidence is right in front of them. Non-polarizing, high-tech crossovers with respectable range and decent charging speed sell well in the U.S. The Chevy Equinox EV, refreshed Toyota bZ, Hyundai Ioniq 5, and Tesla Model Y are all great examples. 

A competitively priced EV3 could give Kia a real shot at regaining its EV mojo.

-Suvrat Kothari

Mercedes-Benz’s jellybean-like EQ cars failed to take off. But the automaker is rolling out a whole new generation of electric vehicles that bring big improvements—like faster charging and more approachable design. The GLC EV that I drove a few weeks back is among the first in this new like of Mercedes EVs and, on first impression, it gets a lot of things right. 

Pros: The way this thing blends comfort and sportiness is truly remarkable, with specs and toys to match.

Cons: While most of the exterior is classy and understated, the in-your-face light-up grille might be a bit too much. The entire dashboard being one giant screen is also kind of a lot.

Bottom line: The GLC EV drives like you expect a Mercedes to and the interior does enough to make you feel fancy. Overall, it was a really positive first impression.

For more, watch my full review, or read my take on InsideEVs.

-Andrei Nedelea

This week, we bid farewell to the Tesla Model S, arguably the most important car of the 21st century. In honor of that, we bring you a review of the 2012 Model S from way back in the day. (I think I know the YouTube hole where I’ll be spending my Friday afternoon.)

Thanks for reading Critical Materials. See you next week!

-Tim Levin