| Thanks for reading Hyperdrive, Bloomberg's newsletter on the future of the auto world. Read today's featured story in full online here. Volkswagen joined Renault in walking back plans to sell shares in electric-vehicle businesses, deterred by slowing EV demand and a brutal market for initial public offerings. VW has put efforts to seek outside investors for its PowerCo battery unit on the back burner, Bloomberg reported Tuesday. Renault scrapped the initial public offering of its EV and software business Ampere late Monday. The altered plans underline the complexities of shifting to EVs as demand for battery-powered cars cools. A number of automakers have pushed back rollouts of new models, and rental firms are paring purchases for their fleets. As subsidies fade and charging remains a hassle, the slower trajectory is setting back an industry making record investments in EVs. The developments are "a clear sign investors are very unsure about the auto sector in Europe this year," said Pierre-Olivier Essig, an analyst at AIR Capital in London. IPOs had their worst year in more than a decade in 2023, according to data compiled by Bloomberg, hampered by rising interest rates. The Ampere offering was expected to be one of the biggest this year and viewed as a possible turning point.  Renault CEO Luca de Meo. Photographer: Alex Kraus/Bloomberg Renault CEO Luca de Meo was seeking a valuation of as much as €10 billion ($10.8 billion) for the business — almost on par with Renault's market value. De Meo, who has led a turnaround of the company, said improved cash generation meant extra funding from a share sale was no longer needed. "We were skeptical early on this potential IPO and view the decision as a positive," Kepler Cheuvreux analysts said in a note, citing the poor performance of several EV stocks that have recently debuted. Over in Germany, Volkswagen is no longer prioritizing stake sales or a potential listing of PowerCo this year or next as it faces doubts it can make its own batteries at scale, people familiar with the matter said, declining to be named detailing internal matters. The situation remains fluid and VW could still move forward with the plans if the market improves, they said. VW is willing to open up PowerCo's capital structure and continues to evaluate options, the carmaker said in an email. While the ramp-up of EVs hasn't been as steep as expected, investor interest in PowerCo "remains high," VW said.  A mural of a VW electric vehicle at PowerCo's SalzGiga factory construction site. Photographer: Krisztian Bocsi/Bloomberg The difficulties are fresh reminders of the operational risks for carmakers tackling unfamiliar technologies in the shifting auto industry. VW's struggle to develop software in-house has delayed several key models and contributed to the ouster of CEO Herbert Diess in 2022. Carmakers are also feeling the pinch from a price war kicked off by Tesla and broad rollback of buying incentives. BloombergNEF still expects global passenger EV sales to rise 21% this year, with 70% of those being fully electric. "Is the context influencing the decision? It's one of the elements," de Meo told reporters and analysts during a call late Monday. "Being totally blind and not looking left and right would've been not been responsible." The Ampere IPO was intended to be part of a complex overhaul separating battery-powered car production from Renault's legacy internal combustion engine operations. Renault is scrapping the plan a week after Tesla forecast a "notably lower" growth rate this year, which sent its shares tumbling to an eight-month low. "We didn't think the IPO made much sense to begin with," Bernstein automotive analyst Daniel Roeska said. "The decision shows that Renault is willing to adapt the execution of its strategic plan and is listening to market feedback." In October, the analyst wrote an open letter to Renault management urging them to reconsider the IPO. Renault will have discussions with its Japanese partners Nissan and Mitsubishi Motors about their plans with Ampere. Nissan had expressed the wish to potentially be able to invest irrespective of an IPO, Renault CFO Thierry Pieton said late Monday. De Meo said Renault has held talks with other carmakers on possibly sharing platforms for EV development, a move that could help Europe's industry compete with an influx of cheaper Chinese battery-powered cars. But he said there's no link between those talks and the decision to scrap the Ampere IPO. — By Albertina Torsoli and Monica Raymunt  A Chevrolet Corvette at a dealership in Colma, California. Photographer: David Paul Morris/Bloomberg General Motors beat expectations for the fourth quarter and expects profits to grow this year on improved sales in the US — though earnings may still fall short of record levels set two years ago.  Tesla chargers in Hawthorne, California. Photographer: Patrick T. Fallon/AFP Tesla still dominates California's electric-vehicle market, though rivals chipped away at the company's share. The Austin-based carmaker accounted for 60.5% of EV sales in the state last year, down from 71% in 2022, according to the California New Car Dealers Association. While Tesla's sales jumped about 25%, brands including Mercedes-Benz and BMW registered bigger gains from much lower bases. | 
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