Automotive State of The Union

Start-Stop Stopping, Tesla In The Rough, Southwest Seat Selection

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Episode #1103: Today we’re talking about backlash against stop-start tech, Tesla’s rocky second quarter and robotaxi dreams, and Southwest’s historic shift to assigned seating.


Show Notes with links:

  • Stop-start engine systems, once praised for fuel savings, often slandered by consumers, are now catching flak from both the EPA and frustrated drivers—prompting new questions about their future.
    • 62% of 2023 vehicles used stop-start to claim EPA efficiency credits around $30 per vehicle
    • A new Trump-era law which eliminated CAFE standards and key penalties is reducing incentives for automakers.
    • Consumers often disable the feature, citing annoyance and wear concerns even going as far as installing aftermarket disablers from Amazon which trick the system while some drivers rely on pedal finesse.
    • “If there’s no CAFE program that can be enforced, and there’s not a greenhouse gas standard that requires improvement, that would remove the incentive for automakers to put in this technology,” said Chris Harto, senior policy analyst at Consumer Reports
    • Lee Zeldin, head of the EPA recently tweeted: Start/stop technology: where your car dies at every red light so companies get a climate participation trophy. EPA approved it, and everyone hates it, so we’re fixing it.


  • Tesla’s Q2 earnings took a hit, with profits and sales both sliding amid fading incentives, slowing EV demand, and political headwinds. Elon Musk says the future rides on autonomy.
    • Net income fell 16% to $1.17B; auto revenue dropped 16% as deliveries declined.
    • Tesla’s $439M in regulatory credit sales was half of last year’s, and shrinking fast.
    • A lower-priced Model Y and stripped-down Cybertruck aim to revive sales.
    • Tesla’s invite-only robotaxi service in Austin may expand to half the U.S. population by year’s end if approvals move forward quickly according to Musk
    • “We probably could have a few rough quarters. I’m not saying we will, but we could.”


  • Southwest Airlines will say goodbye to open seating for the first time in its history, launching assigned seats and a tiered boarding system starting January 27.
    • Ticket sales for assigned seats begin July 29; full rollout hits early next year.
    • Eight new boarding groups will replace A-B-C lines, prioritizing loyalty and fare class.
    • Premium seat options—like extra-legroom—are coming, but prices are still under wraps.
    • About 25% of the fleet is already reconfigured with the new seat layout.
    • “We’re optimizing for efficiency… while taking care of our most loyal customers,” said Southwest’s Stephanie Shafer Modi.

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:

Good morning. It's July 24 it's Thursday. This is the automotive State of the Union. I'm Paul Jay Daly Scott mount today we're talking that old stop start button. Tesla in the rough again. And a little follow up on a Southwest Airline story. We've been tracking for the last several months. We've been tracking it. We're gonna fly

Kyle Mountsier:

it all the things I don't know.

Paul J Daly:

Yeah, I don't know. I

Kyle Mountsier:

was a list for a while, but I quit that. You quit? Yeah, you're a

Paul J Daly:

Delta boy. Now I'm Delta all the way Delta, way Delta. Die made that Wi Fi.

Kyle Mountsier:

You know what I mean. I do.

Paul J Daly:

I do. We have an upcoming ASOTU Edge webinar with car, RX, driving loyalty, with data, with Shane Wilson and Levi, uh, Beatty. Is it? Yes, on Wednesday, August 6, so next week? Oh no, is that two weeks? Two weeks, two weeks from yesterday, you got time to

Kyle Mountsier:

Oh, but register now so you don't forget, you know, yeah, oh yeah.

Paul J Daly:

I want to be reminded. It's like, it's like, a little time capsule. Register now and then. Two weeks from now, you'll be like, Oh yeah, that's

Unknown:

right. That's a good one, great reason to register.

Paul J Daly:

Now go to asotu.com, it'll be right there toward the top of the page. You know how webinar registration work, but these are our quick ones. 2530 minutes. You're in, you're out, you get the recording if you can't make it live, but if you can make it live, it's always fun to be in the comments. Yep, yep. I'm saying, All right, let's talk about some news. Oh, this one just hits real close to home for most drivers, the start stop engine system. You know the fact that your car dies in the middle of like when you're about to cross an intersection and it just shuts off and then turns back on once was like a big a big thing about fuel savings, often slandered by customers, now catching flack from both the EPA and frustrated drivers, prompting new questions about the feature's future, 62% of 2023 vehicles used the stop start tech to claim an EPA efficiency credit, about $30 per vehicle. That adds up to a new Trump era law, which would eliminate the CAFE standards and key penalties, is reducing the incentive for automakers to include the feature, especially when them get they're getting hate mail about it. I'm sure consumers often disable the features, citing annoyance and where concerns, even though it's kind of been shown that, like, it doesn't actually wear your starter out, even though, like old starters, it would have not the new ones, but people are buying aftermarket disablers from like Amazon with, like, wiring harnesses. They hate it so much they're willing to pay money to make it's

Kyle Mountsier:

jarring. Let's just be honest, it's jarring.

Paul J Daly:

Okay, so here's a quote from Chris Harto, senior policy analyst at Consumer Reports. He said, If there is no Cafe program that can be enforced, and there's not a greenhouse gas standard that requires improvement, that would remove the incentive for automakers to put this in the tech. Lee Zeldin, the head of the EPA, recently tweeted, start stop technology where your car dies at every red light. So companies get a climate participation trophy. EPA approved it, and everyone hates it, so we're fixing it.

Kyle Mountsier:

And he dropped the mic right after that, too, all at the same time, just like, walked off the stage, just full on arm extended Mic drop. I have you driven a car like this? Have you driven like Yeah,

Paul J Daly:

I think, I think the No, I think most cars have it. I think the last, the last, like, four cars I've owned, like, my Kia had it. I had a Durango was the first car I ever had that had it. You know, GM vehicle has it. Like, yes, all the cars have it. I'll tell you what so annoying. The navigator, we had had it. I'll tell you what. It really does depend. They're not all the same, right? I will say the Durango was the roughest one we had, because I'm like, is this thing shifting right? The navigator wasn't bad, like, it didn't annoy but, you know, the thing is, some of the cars you're able to turn it off right, like, turn it off off, but most of the cars now It defaults to on when you turn the car back on.

Kyle Mountsier:

What's so funny, there is, like, you can turn this off, but the automaker is still getting the efficiency credit,

Paul J Daly:

yeah, but it goes back on. They do say, like, the the data shows that, like, it can save up to 10% of fuel in stop, start, city traffic. Okay, so, I mean, it's probably like a

Kyle Mountsier:

percent. Maybe that's nifty. You can tell I got opinions about it. There's

Paul J Daly:

nothing like feeling like you like, hit the gas and it delays when you need to hit the gas. And, yeah, I hate the feature. I mean, I guess if it's an option to turn it on and but, like, about hybrids and EVs? My EV never does that. It's like, it's always all the power and always on. I told I towed a boat with it yesterday again. And let me just say, you got there's it is amazing. It is so amazing to tow it, that thing well, because all the torque, because torque is what you need, and breaking is easy. It's easy to solve nothing. Oh yeah, the fact that, like, you take your foot off the gas and like, and the feeling that that big, heavy thing back there is actually charging my vehicle. Yeah, it's good.

Kyle Mountsier:

Yeah, that thing back there is recharging well, but it doesn't, you know, it's kind of low on the flip

Paul J Daly:

side. And like I did all the I put all like that, the stats and you load a trailer up, give me the way, give me the dimensions, range calculation, yeah, pretty much cuts it in half.

Kyle Mountsier:

You're like, all that charging. Does nothing, quite

Paul J Daly:

hilly area. So like the trek to put the boat in the lake, even though it's only like, you know, 10 miles, there's a lot of hills. And basically it's like a mile per percent is what it Oh, my goodness, that's unbelievable. So take that with a grain of salt. No, no. Long trips, no longer. Fine. Speaking of long trips, Tesla's had a long trip. Tesla feels like they're on the road trip that'll never stumble. Their q2 earnings took a hit, with profits and sales both sliding amid fading incentives slowing. Ed EV demand and political headwinds. Elon Musk saying the future rides on autonomy, their net income fell 16% to 1.1 7 billion auto revenue dropped 16% as deliveries declined there. There, they had $439 million in regulatory credit sales, meaning they're selling their environmental credits to other automakers. That was half of what it was last year, shrinking fast. They say, take this with a the Elon sized grain of salt, a lower price model Y and a stripped down cyber truck are aiming to revive sales. We'll see. We'll see Tesla's invite only Robo taxi service in Austin may expand to half of the US population by the year's end, if approvals move forward, according to musk, that sounds like a long way to go from where they are now.

Kyle Mountsier:

Yeah, have you ever seen government move that fast?

Paul J Daly:

No, he said, he said, quote, he goes, we probably could have a few rough quarters. I'm not saying we will, but we could.

Kyle Mountsier:

So, yeah, this is actually, you know, if you look at like the growth of Apple over time, and then Android kind of catching up and leapfrogging them in some of the technology that they have. And, like putting everyone at a little bit of a question mark, there's some similarities here, especially globally, maybe not so much in the US, from an EV manufacturer perspective, and and obviously we know the political tension, some of that's getting resolved now, you know, I think the, you know, the over promise, under deliver, is starting to weigh on some investors, but I think that Elon is just so much of a he's just so much in pursuit of these crazy ideas with that when they do happen, they'll be kind of earth shattering. And you know, the thing about the difference between, like, a Waymo mapping a city and Tesla mapping a city is they've been they've been collecting data on these cities for 12 plus years now. Great point. So like, the the ability for them to map and understand a city and the travel patterns of that city is like, it's an instant. So the minute they get access to these cities, it's not going to be like, oh, we need to go in and map this thing with our technology teams. They're going to be like, pull up data set for Nashville.

Paul J Daly:

That is insane. When you think about the level of data, the amount of data they're collecting on a daily basis. They are just ingesting hour after hour after hour of video, real life, real world, squirrely pedestrian data, yeah, it's,

Kyle Mountsier:

it's not just the roads, it's the patterns. It's like, how does this move during this time of day, and where, you know, where do people cross in front of things like they, they can analyze all

Paul J Daly:

of that. That's gotta be wild. What a wild data set. Yeah. Speaking of wild

Unknown:

segway,

Paul J Daly:

big changes about to be

Kyle Mountsier:

here next week, Southwest air, by airlines, is finally putting the stamp on saying goodbye to open seating for the first time in its history, they launched assigned seats in a tiered boarding system starting in January for a couple flights. Right? I think it was like California to Baltimore or something like that. Assigned seat ticket sales begin July, 29 with full out roll outs early next year, eight new boarding groups, replace a, b and c lines, priority, prioritizing loyalty and fair class. So they basically doing the eight, eight boarding groups, eight boarding groups. I mean, that's, that's what like United has eight boarding groups, premium seat options. They really do extra leg room are coming, but prices are still under wraps. About 25% of the fleet is already reconfigured with the new seat layout. That's pretty impressive southwest. Stephanie Schaefer Modi said we're optimizing for efficiency while taking care of our most loyal customers. All

Paul J Daly:

right, we'll see what happens. Because you know, our head of our production team, the owner of the company that we work with to produce our Docu series called southwest the public transportation of the skies, because that's what it feels like, until that right? Like you go on and you sit, you sit next to like the least weird person, right? Which is, which is like city bus rules, it is the least word. How can I You're scoping it all out myself from a potentially weird experience that's going away. I think this is just a story of a company who has to reinvent itself and knows it so they're taking a drastic measure. I guess it just shows the evolution of a company over time. But it's not like a I mean, how old southwest, it's pretty old. It's older company, 50 years old, right? Unfortunately, I'm always a little bitter. Year, because when you know you and I first started rolling together, you know, five years ago, whatever you just talked about Southwest, like, so highly, and by the time we came to Syracuse, it was ruined and terrible. So I never really got the Southwest experience.

Kyle Mountsier:

Well, it used to be like, I mean, literally, it was 10 minutes less boarding time, right? Because it's just like the process is so much different from a boarding perspective. And like, how the groups have to get up, like, you just line up, you're in, you get your seat, you know, there's no, like, jockeying for, you know, for, for where you stop. It's just so much smoother and and, you know, I think they've just the problem. The biggest problem, in my perspective, is their pricing is at or higher than the other airlines, where you get to pick your seat, and that's the biggest problem that they've run into. And so, yeah, it's not a discount airline themselves, exactly.

Paul J Daly:

All right. Well, we'll see what happens a lot of travelers out there, a lot of travelers in our audience, that's for sure. So lots of travel if you book a seat, if you book a seat, like an assigned scene on a Southwest flight. Send us a screenshot, and we're going to throw them on social media. Do that? Send it? Yes. Oh, it's full stop. Full stop. I think we need some outro music. You have an amazing day out there, serving people, selling some stuff, because that, all that, that combo right there, goes together really, really well. We believe in it. We believe in you, we'll see you tomorrow. You.

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Kyle Mountsier

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Paul J Daly

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