Fisker Delivers (11/21/22)

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In today's newsletter:⚡ The Headline: Fisker delivers on its long-promised Nov. 17 SOP 🚨 Making News: Tesla CEO successor? GM EV margins, VW troubles, Canoo SOP 🇪🇺 Europe Electrified: NIO buy option, EV Golf, Poland partners with Geely🧧 China Report: Lithium prices soar, BYD hits 3 million, Mercedes price cuts🔋 Supplier Supercharge: VW battery IPO, GM nickel deal, Redwood and Panasonic

⚡ Fisker Delivers ⚡

Congratulations to Henrik and the entire Fisker team.In a sea of missed EV startup milestones, Fisker has proven to be a Gibraltar of promises kept. Through thick and thin, for more than two years, Fisker stuck to its November 17 SOP deadline. And last week, the first Ocean rolled off the line at production partner Magna's Graz, Austria plant.Fisker estimates it will produce just around 300 units in the first quarter of 2023, with a ramp to 8,000 units in the second quarter. It plans to almost double that number once again in the third quarter to 15,000 units.

In all, Fisker plans to build 42,400 Oceans in 2023.

The company currently claims 63,000 reservations for the Ocean. Meanwhile, it is working on its next model, the $29,900 Fisker Pear. Unlike the Ocean, the Pear will be manufactured in the U.S. in partnership with Foxconn at its Lordstown, Ohio.Check out Fisker's SOP video and some shots of the event:

🚨 Making News 🚨

Tesla board member says Musk identified potential CEO successor. During testimony at trial over Elon Musk’s 2018 pay package, Tesla board member James Murdoch testified that Musk has identified someone as a potential successor for his role as CEO at Tesla. "He actually has," Murdoch said when a plaintiff's attorney asked him to confirm that Musk has never identified someone as a potential successor. Murdoch said this happened sometime in the "last few months."

GM: EV margins will nearly match ICE vehicles by mid-decade. GM says North American EVs will be ‘solidly profitable' by 2025. By that date, GM expects to be building 1 million EVs a year in North America and 1.2 million battery cells daily in the U.S. GM CFO Paul Jacobson told reporters ahead of the company's investor day in New York that the automaker will maintain North American profit margins of 8-10% in the coming years.

Volkswagen's $2 billion Trinity EV plant in doubt. CEO Oliver Blume is reviewing whether to stick to a plan to build a new plant to assemble its Trinity EVs or to use its existing Wolfsburg factory. Volkswagen had planned to start building the $2.06 billion factory in 2023 and produce its flagship electric sedan there starting in 2026. If confirmed, the changes could improve Volkswagen's free cash flow but would risk delaying electrification plans and crucial product launches, Bernstein analyst Daniel Roeska said in a research note.

Faraday Future signs deal with Yorkville to raise up to $350 million. The company said it has signed a deal with an affiliate of Yorkville Advisors Global for an equity line of credit up to $350 million. The financing, which entails an initial commitment of $200 million from the New Jersey-based investment firm, will be “key” to producing the company’s long-awaited first model, the FF 91.

Canoo says it has started production of its EVs. In a series of social media postings, Canoo announced that it had reached a milestone by declaring Start of Production (SOP) on 11/17 of its LV and LDV. The first 15 vehicles off the production line are for the company, NASA, Walmart and other strategic partners. Following 15 initial builds, Canoo will shift all of its equipment into the recently announced Oklahoma City facility during 1H’23.

GM projects $2,000 savings per vehicle from digital retailing, regional EV fulfillment. The inventory management change is designed to speed up vehicle delivery times — to as few as four days — and increase efficiency, which will reduce distribution costs. GM has opened three centralized EV fulfillment centers — two in California and one in the Southeast, President Mark Reuss said.

Brightdrop on track to reach $1 billion revenue in 2023. According to a press release by the company, BrightDrop shared with investors that it is on track to reach $1 billion in revenue in 2023, making it one of the fastest companies to ever hit that milestone. The company also confirmed that it is set to generate up to $10 billion in revenue and reach 20% profit margins by the end of the decade.

VinFast signs fleet deal with Autonomy for 2,500 EVs. The deal between the Vietnamese automaker and the L.A.-based car subscription service comes as VinFast prepares to deliver its first vehicles in the U.S. The deal is worth about $100 million. VinFast is also presenting two new crossovers at the L.A. auto show in addition to the midsize VF 8 and VF 9 models that have been open for pre-orders since early this year.

Fiat 500e returning to U.S. in 2024. The car is scheduled to go on sale in the first quarter of 2024. Stellantis likely will export the 500e from its Mirafiori plant in Turin, Italy, where the European version, known as the New 500, is built. Fiat discontinued North American sales of the 500e and the standard gasoline-powered 500 in North America. The reintroduction of the 500e is welcome news for U.S. and Canadian dealers who have had nothing to sell except the 500X since before Fiat Chrysler merged with PSA Group to form Stellantis in 2021.

🇪🇺 Europe Electrified 🇪🇺

NIO Europe buy option now available as expansion plan continues. Customers in Europe now have the option to purchase the EV startup's vehicles. NIO originally launched on the continent with a lease-only program. The company also launched its first power-swapping station in Varberg, Sweden. On its November earnings call, NIO said it planned to install 20 power swapping stations across Europe by the end of 2022 and increase the tally to 100 by next year.

VW may build electric Golf after Trinity flagship EV delay. VW may build the electric Golf after its flagship Trinity EV project faces delays until 2030. The electric Golf or Tiguan would use an updated MEB electric platform and would be built at the automaker's Wolfsburg factory where combustion engine variants of the cars are built, German business daily Handelsblatt said, citing company sources. The new EV could go on sale before 2026.

Poland chooses Geely to supply its Izera brand with an EV platform. The Izera is a key element in Polish efforts to harness the switch to electric vehicles to help its auto sector catch up with regional rivals including the Czech Republic and Slovakia. The Izera will use Geely's SEA platform, the companies said, making it the first company from outside the Geely group to do so. The platform comprises the mechanical and software elements that form the basis of the car. The first vehicles will be produced at EMP's plant in Jaworzno, southern Poland.

🧧 China Report 🧧

China Has Shot at Seizing 60% Share of Global EV Sales This Year. A total of 722,000 plug-in passenger and commercial vehicles were sold in China so far this year. Battery-electric vehicles were 22% of the passenger car market, and plug-in hybrids claimed another 9% share. China’s share of global passenger EV sales has gone from 26% in 2015, to 48% in 2021, to 56% in first half of 2022. We’re expecting a big surge in the final months of the year that could push the share north of 60%.

BYD produced its 3 millionth NEV. Number 3 million appeared to be a BYD Seal sedan. BYD reported that it took 13 years for it to produce its first million of new energy vehicles. In May 2022, BYD’s 2 millionth NEV rolled off the production line in China. And it has taken only a half of a year to produce the 3 millionth one.

BYD scraps IPO plan for semiconductor unit. The company said that a move to increase investment in wafer production would significantly affect the unit’s asset structure. "BYD Semiconductor intends to seize the time window to make large-scale investment in wafer production capacity," BYD said in a filing to the Shenzhen stock exchange, adding current wafer supplies were far from enough to meet demand amid rapid growth in electric vehicle manufacturing.

Mercedes cuts China EV prices by up to $33,000 as sales lag. Mercedes is making the cuts because sales have been disappointing in China, according to people familiar with the company’s plans. Some dealers have already been carrying out promotions to try and boost sales, with EQS deliveries at times dropping to as low as 100 a month. In a statement to Bloomberg News, Mercedes said the top-end EV segment in China is still evolving, especially for cars priced above 1 million yuan.

Regulators vow to crack down on price gouging as lithium prices reach new heights. China will strictly investigate and punish hoarding, price gouging and unfair competition in the upstream and downstream lithium battery industry to maintain market order, according to a joint memo by China's Ministry of Industry and Information Technology and the State Administration for Market Regulation.

Zeekr M-Vision concept car for Waymo’s robotaxi fleet revealed. Zeekr, a Geely brand, announced that its M-Vision concept car based on the SEA-M platform will be ready for mass production by 2024. This model will be equipped with the latest generation of Waymo Driver and put into commercial operation in the United States.

🔋 Supplier Supercharge 🔋

Volkswagen in talks with pre-IPO investors for battery unit. The idea is to bring in investors pre-IPO so Volkswagen can gauge how the division - named PowerCo - might be valued in a potential flotation, the sources said, adding that Volkswagen is working with advisers on a potential deal structure. Volkswagen has set aside $21 billion for investment in its battery cell business, with the PowerCo unit managing its battery production and research from mining to recycling and projects including energy storage systems.

GM secures nickel for EV ramp-up from Vale’s new Quebec Battery Valley factory. This agreement secures for GM a supply of nickel sulfate from a U.S. free-trade partner to support its fast-growing EV production needs in North America. Under the agreement, Vale will supply up to 25,000 metric tons per year of battery-grade nickel sulfate. GM confirmed that the material will be used to support its ambitious ramp-up in electric vehicle production.

Japanese electric motor maker Nidec to build $715 million Mexican plant. Construction is expected to begin during or after the next business year starting in April, the newspaper said. CEO Shigenobu Nagamori said of the investment that the company's focus was on manufacturing products in a region to sell in that region. Nidec makes a traction motor for electric vehicles, known as "e-axle," which is an integration of an integrated motor, decelerator and inverter system that is equivalent to the engine for gasoline cars.

Redwood Materials to supply new Panasonic EV battery plant. Redwood Materials will provide cathode material, a key component of the lithium ion batteries that power electric vehicles, for a giant factory Panasonic Energy Co. is building in Kansas. The deal represents the first time the material will be made at gigafactory scale in the U.S. Redwood Materials said it plans to produce 100 gigawatt-hours of cathode for 1 million EVs from recycled battery cell material by 2025 at its $3.5 billion battery materials factory under construction near Reno, Nev.