Automotive State of The Union

Senate Passes Budget, Hyundai Hot Streak, Cloudflare Block AI Scrapers

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Episode #1085: Today we’re diving into a high-stakes Senate budget bill that could end EV credits early, Hyundai’s record-breaking U.S. sales run, and Cloudflare’s bold move to make AI bots pay to crawl. 


Show Notes with links:

  • The Senate passed a budget bill by a razor-thin 51-50 vote, with VP JD Vance breaking the tie. The bill, which moves to the House next, packs major implications for automakers and dealers alike.
    • As we covered yesterday, the current version would kill EV tax credits by Sept. 30, 2025.
    • CAFE penalties for fuel economy non-compliance would be eliminated, gutting enforcement.
    • Car loan interest (up to $10,000/year) could be deducted for certain U.S.-built vehicle purchases from 2025-2028.
    • An earlier AI regulation ban, which might’ve restricted state autonomous vehicle laws, was cut from the final bill.
    • Electrification Coalition: Ending EV credits “would cede control over the future of transportation to China.”


  • Hyundai just posted its best-ever U.S. sales performance in the first half of 2025, powered by strong EV momentum and a major new plant in Georgia. The automaker says this is only the beginning.
    • Hyundai sold 439,280 vehicles in H1 2025, a 10% YoY increase—the most since its 1986 U.S. debut.
    • Q2 and June also set new records with 235K+ (+10%) and 70K (+3%) vehicles sold, respectively.
    • The IONIQ 5 remains a top EV performer with 19,092 units sold YTD; IONIQ 9 logged 1,013 units since May.
    • The new Metaplant in Georgia can build 300K vehicles/year—expandable to 500K—with both IONIQ 5 and IONIQ 9 rolling off the line.
    • With leases as low as $179/month and free home chargers on offer, Hyundai is “building momentum with every mile,” said North America CEO Randy Parker.


  • Cloudflare is positioning to be the premier AI gatekeeper by blocking AI bots by default for new websites and launching a paywall-style marketplace for AI crawlers.
    • New sites on Cloudflare will automatically block AI bots unless given explicit permission.
    • Their new “Pay per Crawl” lets publishers charge bots for different kinds of data use.
    • Condé Nast, TIME, and The Atlantic are on board after seeing steep traffic drops from AI-generated answers.
    • OpenAI bots reportedly scrape 1,700 times per referral, while Anthropic scrapes 73,000 to one. Google is only 14 per referral
    • “This could split the internet,” one analyst said, noting the potential divide between premium and freely scraped content.

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

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Paul J Daly:

I hit the button, but nothing was happening. Now, the buttons there works. You know, I had to get to get I'll charge up for the second half of the year. It's Wednesday, July 2, the automotive State of the Union. I'm Paul Jay Daly. It's come out here. We're talking about Senate passes budget. We're talking about Hyundai's kind of like defying the Senate budget thing. That's

Unknown:

a good way of feeling like that.

Paul J Daly:

It feels very defiant. Cloudflare being defiant too. Cloudflare is going to stir up some trouble. They are. There's some people that are, that have some feelings. Are kind of people. Listen, yesterday was an awesome day, first day of the second half of the year. Today was a great day. Seems like it's going to be an even better day. Even better day. I feel that way. Probably there's weather.

Kyle Mountsier:

There's just so much happening. There's just so much happening. Some, you know,

Paul J Daly:

sometimes a weird, a weird time in the industry, because depending on what region you in, you're in, like, the sales do different things, because I mean, school's out, but you know, summer season is on that and, you know,

Kyle Mountsier:

July and August are always good. July and August are always good. What I mean that as long as I've been in the business, it's like rock and roll. There's

Paul J Daly:

a lot of vacations too, like you think about it, a lot of people are traveling like you even talk. You know,

Kyle Mountsier:

what's interesting about there are a lot of vacations internally for a team. I'm just going to theorize about this. I think that this activity breeds activity. Thing is so I talk about it so often that, like, when you're active, active, things happen around you. Yeah, that, like, if you lose a couple people on the team for a week, it's almost like everybody else has to raise the bar, and all of a sudden, customers feel it, and there's a high energy, and there's pace and movement. And like, you know, don't get up when you got to

Paul J Daly:

work a couple extra hours, no, if you have the right culture, that really does. Like, when you start to lean out a little bit, you get to see everyone step up, and that camaraderie around stepping up Does, does really perpetuate itself throughout. I like that. That's good theory. Good theorizing.

Kyle Mountsier:

Look at that theory. Really good theoretically. On the day, after some

Paul J Daly:

theoretically and some practical ethically, on July 9, on our next ASOTU Edge webinar, as we're talking about smart customer transportation management with Steven Chapman of Uber for business, you can go to asotu.com just you can sign up right there. You know how it works. You know how it works. You'd be with us live. Or you could get the recording. Talk about, maybe open up some new solutions for moving people around when they're waiting in the service lane, or they need to get their car. They're trying to buy a car, and they need to go somewhere and talk about all that stuff. So you should be there. You should be there. You should talk about some news, huh? Let's get into the news. Finally, we have, we have a finality on something that's been kicking back and forth. The Senate passed a budget bill yesterday by a razor thin 51 to 50 vote with Vice President JD Vance breaking the tie. The bill, which moves to the house next, packs major implications for automakers and dealers alike, as we covered yesterday, the current version would kill EV tax credits by September 30, 2025, so they did not take any of our advice. Cafe penalties for fuel economy non compliance would be eliminated, gutting enforcement on all those standards. Car loan interest, up to $10,000 a year could be deducted from your taxes. For certain, US built vehicle purchases between 2025, and 2028 an earlier AI regulation ban, which might have restricted state autonomous vehicle laws, Will was cut from the bill completely. And the electrification coalition, they're going to end the EV credits, actually the What is this electrification coalition? Oh, the colon messed me up. Colon messed me up. They said ending EV credits would cede control over the future of transportation to China. That's that's

Kyle Mountsier:

ominous. That's a strong one. That's a strong one. I think that there is some legitimacy to that, even if it's just, hey, the pace of EV sales in the US isn't enough to keep up with the rest of the world. So the Chinese kind of take that as as an even more of a leader spot than than currently the interesting one years the car loan interest on vehicles made in the US, I believe that that's like final manufacturing spot in the US. So there's still a lot of non big three that get involved in that. The chances of this thing making it past the past the house when it's not bipartisan agreement in the Senate, where it's a 5150 vote and JD Vance had to break the tie are slim to none. However, crazier things have happened, we'll see if that happens.

Paul J Daly:

What's the, what's the what's the what's the over, under in the house? How many seats Republicans

Kyle Mountsier:

have? It's not 5050 in the Senate either. Which means that it's

Paul J Daly:

not like, is it 6040 Yeah. We don't know. We don't know these

Kyle Mountsier:

things. Which means, which means there were Republicans and Democrats on both sides of this thing. It was, it was, yeah, so, so not bipartisan support. Interesting, probably not going to get past. Past that the house as kind of like the larger body of people get their hands on it probably going to get ping pong back and forth. So I

Paul J Daly:

wouldn't all that means is that we don't know what's happening with the EV tax credit, still, yeah, I

Kyle Mountsier:

would just say, don't get too excited. But, but yeah, I mean, the fact that it passed one side is is definitely concerning for the pace at which, you know, Capitol Hill is thinking about implementing some of this

Paul J Daly:

stuff. Yeah, Mike Stanton said this when we were with him a little bit ago, and it's been his constant drum, the voice of the dealer saying, like, listen, dealers have, like, a lot of vehicles, EVS on their lot, so we need a reasonable amount of time to end this credit so that we can actually, you know, get the inventory that we made decisions on based on the credit, we can actually get rid of that inventory, and then we can make new pricing decisions, new acquisition decisions based on the landscape. And 90 days just isn't enough. It's actually less than 90 days right now. And when the bill passes, it's going to be even less than 90 days so, or if it passes, or whatever. So I think that's, you know, the thing every dealer is keeping their eye on. That's, that's really the point of relevance, not all the other stuff. Yeah, Hyundai, those jokers down. Hyundai, on the other hand, on the other Wow, they just posted their best ever US sales performance in the first half of a year, powered by strong EV momentum and a major new plant in Georgia, the automaker says this is only the beginning. They sold 439,280 vehicles in the first half of this year, 10% increase year over year, the most since 1986 when it made its US debut. Q2, in June. Q2 and June overall, sent new records with 235,000 vehicles. That's up 10% and 70,000 vehicles just in June alone, which is up 3% when a lot of people were down in June. The IONIQ five remains a top EV performer with almost or 19,092 units sold. Ionic nine sold over 1000 units. The new meta plant. They're calling the meta plan. Get this, it can build 300,000 vehicles per year, expandable to 500,000 with both the ionic five and the new ionic nine rolling off that line leases as low as drum roll please, 179 per month and free home chargers. Hyundai says CEO Randy Parker says they are, quote, building momentum with every mile. They are looking on a tear.

Kyle Mountsier:

And Randy's playing the brand played like perfectly, especially within retail auto and the events that he's talking at in the in the way that he's communicating to dealers and industry partners, I think that the vehicles look great. Their technology is great. They're incentivizing them in the correct way. You've got the US manufacturing piece locked down. They were early on that, you know, a few years back, already negotiating that and then building that plant over the last few years to get it live and active. Ability to scale up to 500,000 units. This is, this is the brand to watch. I would call this, like the new Toyota. They are coming for it.

Paul J Daly:

They quiet. They're playing the game. I feel like with these with entry level and not entry level EVs, so Well, by offering additional incentives on lease deals and home charging, that's how you actually move through some inventory, right? Yep, you got 90 days. They're like, Cool. We'll roll all that $7,500 into this lease. We'll discount it further, we'll give you home charging, and we'll give you a sub $200 a month way to buy a car. Kyle, I can't tell you how many people I suggest this lease to when they're like, they call me. They're like, I got 15 grand. Am I screw? Am I screwed right for a car? And I'm like, No, actually, no, you like driving new cars? Like, I'm like, You should lease it.

Kyle Mountsier:

Have you seen the other side of these ionic nines? I have It's unbelievable

Paul J Daly:

that I literally do the math for them. And like, I'm like, look, okay, $15,000 say you buy this car. Say you need this many repairs over the next 36 months, you're gonna put this much into it. And now look at this lease. It's 179 a month, zero repairs, all this certainty, and you spend like$5,000 less to drive the new car. They're like, Yeah, but I don't own it. I'm like, That$15,000 car is gonna be on its last leg in three years

Kyle Mountsier:

for sure. Yeah, yeah. A $15,000 car these days. Get

Paul J Daly:

out. It's hard, it's hard to make that people and then the EV thing too. I'm like, Well, what do you drive? I really don't drive a lot. Like, you know, we're bullish on these guys. We're bullish on such a value. Like, regardless, such a value. So good, I know, so good. I don't know how to segue into this next story.

Kyle Mountsier:

I don't know either

Paul J Daly:

things to people. Segue, nerd alert,

Kyle Mountsier:

Cloudflare is positioning to be the premier AI gatekeeper by blocking AI bots by default for new websites and launching a paywall style marketplace for AI crawlers

Paul J Daly:

right stop before you go any further, explain to the people what. Cloudflare is so CloudFlare,

Kyle Mountsier:

like the their their primary business strategy is to be a web application firewall, so they are responsible for not letting in visitors to sites that you don't want. They have expanded infinitely past that. They are they can be a domain registrar. They can deploy code. They they can do so much across so many websites. There's ability to inject in real time data into a website. So let me, let me break it down

Paul J Daly:

a little further. You have a website, yeah. And instead of going to the the server that is your website host, you're like, actually, I want, when someone types in my URL, I wanted to go to Cloudflare first. That's right. And then Cloud fire does all this people right, and then shows, pops it up on your screen. Yep, exactly. I had to really

Kyle Mountsier:

break it down. So what it allows them to do is kind of be the first line of defense on everything, right, and also the first line of like code quality, what gets delivered to the web browser, all that. So they're going to automatically block AI bots unless given explicit permission. So you have to go in and actually give it permission for the AI bots, which they've got a massive domain database that they are constantly expanding on, blocking these things, and then they're going to allow publishers to to give, like, the domain access right, to pay for them to pay so that they can get access to scraping these sites. Conde, nada time the Atlantic are on board after seeing steep traffic drops from Ai generated answers. So basically, they're like, hey, look, we're not going to be able to get these people to the site, because you're scraping my site and then providing the AI answers. Let me at least monetize the data that I have on my site.

Paul J Daly:

Yeah, the work that I did to put it together.

Kyle Mountsier:

Check this out. Open AI bots reportedly scrapes 1700 times per referral, right? While anthropic scrapes 73,000 to one. Google is only 14 per referral, per referral. So basically like, if, if they're going to refer you to like the click, yeah. So basically, 17,000 to one for every one time they're scraping you, 17,000 times for everyone to your site, yeah, for everyone, they're getting you them to the site 73,000 times they're scraping it so they can get the data and provide that to the users. One analyst said this could split the internet, literally providing a prevention potential divide between premium and freely scraped content. Here's cloud for CEO, Matthew Prince. He said people trust the AI more over the last six months, which means they're not reading original content. This, just like as a note, this right here is crucial to cloud players overall business strategy, because if people move away from developing on their platform for the web, because their websites are no longer as relevant and they're just data repositories, it could be dangerous to their business. So it actually provides like business protection for them and for their clients over time.

Paul J Daly:

Yeah, I was thinking about what this does to the the idea, I mean, we've been telling people, right, if you're a brand and you need to show up in the generative search results, right? Some types in AI, you want to show up there, right? And that only happens by you putting good, easy to understand, quickly, processable data on your site, so that you are included. Flip side is, do you think that these, you know, AI companies, are going to prioritize free content? Yes,

Kyle Mountsier:

absolutely. And so it's like, what is there all paywall already?

Paul J Daly:

What's the balance between not showing up and having such quality content that the AI knows they need? Right? This is a very interesting capitalistic, entrepreneurial thing that's going the

Kyle Mountsier:

fastest, most content rich websites right now are getting prioritized by these, these AI bots, because the crawl budgets are much lower, so the more you have that, the more potentially monetizing your content will be

Paul J Daly:

important. Yeah. I mean, we did that. We did a deep research paper you and I earlier this week, and it was about EVs in China, and macroeconomics and energy and all these things. And we were, there's a long list of things cited in there, but it didn't know. We didn't tell it to and it didn't, but it cited some ASOTU work in there, which is like, oh, yeah, maybe, but on LinkedIn, but on LinkedIn, right? Yeah. It's crazy. What a weird world, what a wild world. But I mean, like this, this ties back down. Like, when are people going to shop for cars on these tools? They already are. So how do we make it so that you show up as a preferred partner? Just do it like, go on chat GPT, or go on Claude, and just say I'm looking for this type of car, and then I live in this area. But. Where should I buy it? And why ask it that and see if you pop up and see what it says about you, and then suggest your own store. How about Kyle mount sear and see if it gets enough data. You can do that anyway. Yep, Mount sermons that that actually is a ring to it. It does have a ring to it. I've thought about it before. We'll see. Yeah, once or twice we're only in like the third inning, man, come on, seventh innings, gonna involve stores and fun whatever. It's July 2. It's nice out. People are out buying. They're doing the summer thing. Go do the summer thing too. Take care.

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Kyle Mountsier

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Paul J Daly

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