Weekly Newsletter Issue #8: Big EV Ambitions, Small Production Reality

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Now to the news.

In today's newsletter:⚡ Headline: While electric ambitions are high, just 4% of N.A. car production is electric🚨 In Other News: Tesla "steady as she goes" deliveries, Arrival's van, Hertz-BP charging🧧 The China Report: China September sales, Geely stake in Aston Martin, NIO Europe🗓️ Last Week Today: EV news you might have missed

While electric ambitions are high, just 4% of N.A. car production is electric

Car companies have big ambitions when it comes to going electric. Automotive News assembled a list of 150 plug-in vehicles expected to arrive at U.S. dealerships or go direct to consumers through 2026.

20 brands are planning to start selling EVs in the U.S. for the first time over the next five years:

And while one quarter of Americans want an EV, just 4% of North American car production is electric. Of the 7.4 million cars and trucks made in the first half of the year, only 323,000 of them were battery-powered.

As a case study, 70% of Ford's North American production in the first half of the year was comprised of models at or below the national average of 25 miles per gallon. It sold 249,000 gas-powered F-150s. It made just about 2,000 F-150 Lightnings. And it's best selling EV, the Mustang Mach-E, was number seven in overall production, at just 34,000 units.

And it seems that production won't hit the demand threshold for some time:

🚨 In Other News 🚨

Tesla Q3 deliveries reach record but fall short of estimates. Tesla delivered 343,830 cars in the third quarter, below the 358,000 vehicles that analysts expected. The company said that it was transitioning to a more regional mix as delivery peaks became more and more challenging. Elon Musk said "steady as she goes is the right move" as customer experience suffers when there is an end of quarter rush. Year-to-date, Tesla has delivered ~909,000 vehicles. The company delivered ~936,000 in all of 2021.

Arrival produces first van at microfactory but misses targets. The UK EV startup produced the first production verification vehicle at its Bicester Microfactory. However, the company missed its Q3 production targets. Arrival still expects to generate revenue in 2023 and said it would need to raise capital for its second van microfactory in Charlotte, North Carolina. That location will primarily focus on fulfilling a 10,000-van order from UPS.

The SPAC is back: EV startup INDIEV to go public on Nasdaq: Thought SPACs were dead? Apparently not. LA-based EV startup INDIEV, founded by Chinese mobile gaming entrepreneur Shi Hai, has entered into a definitive merger agreement with Malacca Straits Acquisition (Nasdaq: MLAC). The deal is expected to close in the first quarter of 2023 and values the company at $600 million. INDIEV's INDI One - an "EV for gamers" - is priced at $45,000 and expected to start production in mid-2023.

DeLorean executives sued by Karma Automotive. A lawsuit by Karma took aim at the DeLorean CEO, COO, CMO and VP, all of whom formerly worked at the struggling luxury EV company. The lawsuit alleges that CEO Joost de Vries and COO Alan Yuan, while at Karma, pursued an outside venture while tasked to find investors for Karma, creating the new DeLorean without express permission.  

Canoo courts policymakers in DC trip. Canoo CEO Tony Acquila took Canoo's MPDV to Washington and toured the town with Senator James Lankford, Congresswoman Stephanie Brice and Congressman Markwayne Mullin - all from Oklahoma where Canoo is headquartered. The U.S. Army is evaluating Canoo's vehicle for potential use in operational and garrison environments. NASA also selected the MPDV to shuttle astronauts to the Artemis launch pad.

Tesla Model 3 AWD tops Department of Energy list. The DOE evaluated 17 model year 2022 vehicles (37 total configurations) that achieved an EPA combined rating of 100 MPGe or higher. The Tesla Model 3 in rear-wheel drive configuration achieved the highest rating for MY 2022 with 132 MPGe.

Chinese EV battery supplier gets $2.4 billion tax break for Michigan plant. Mecosta County and a pair of Michigan townships approved tax breaks for Chinese battery producer Gotion's $2.4 billion plant. The project is expected to create 2,350 jobs over the next decade. Gotion makes electronics, battery packs and other energy storage technologies for EVs. Its parent company's largest shareholder is Volkswagen Group, which owns a 26.5% stake.

Hertz, BP partner on North America charging network. The deal comes as car-rental company Hertz adds tens of thousands EVs to its fleet (just two weeks ago, Hertz agreed to buy 175,000 EVs from GM over a five year period. It has similar deals with Tesla and Polestar). Hertz is teaming up with BP Pulse, BP's EV charging business, which will power and manage Hertz's charging infrastructure.

VP Harris promises to work with South Korea on EV Dispute. While visiting Japan to attend former Japanese Prime Minister Shinzo Abe's funeral, Harris spoke with South Korean Prime Minister Han Duck-soo, saying she "understood" his concerns about the EV tax incentives included in the Inflation Reduction Act. The law requires carmakers to assemble EVs in North America and use local materials in order to receive subsidies. Hyundai does not operate any EV car plants in the U.S., and the three main Korean battery makers import most of their critical minerals from China.

Stellantis partners with Uber for EVs in France. Stellantis's Free2Move mobility unit will help Uber convert 50% of its fleet of vehicles in France to EVs. The production and sale of more hybrids and EVs is a key part of plan by Stellantis CEO Carlos Tavares to double overall revenue to 300 billion euros ($288 billion) by 2030. 

Lordstown at last begins production of the Endurance. Finally, after a tumultuous period that included fraudulent pre-order numbers, an SEC investigation, shareholder litigation, the forced resignation of founder Steve Burns, and a sale of the Lordstown plant to iPhone manufacturer Foxconn, Lordstown Motors has started production of the electric Endurance pickup truck. Two have been made so far in the first batch of 500. It aims to deliver 50 trucks before the end of the year.

GM collaborates with OneD on battery technology, participates in Series C round. The collaboration focuses on increasing energy density and cost reduction in future GM EV batteries. GM Ventures and Volta Energy Technologies also participated in OneD's Series C funding round, which the company recently closed at $25 million. GM plans to ramp Ultium to reach 1 million units of capacity by 2025. Earlier this year, GM's first Ultium Cells joint venture battery plant began production in Ohio, with two additional U.S. plants under construction and a fourth also planned.

Redwood Battery Materials Campus 1 to supply Tesla with recycled products. Battery recycling giant Redwood Materials said that its campus will begin producing product by the end of the year that will be returned to Tesla's Gigafactory 1 via Panasonic. Battery Materials Campus 1 will produce 100 GWh of anode copper foil and cathode active material annually by 2025, enough to produce more than one million EVs a year.

🧧 The China Report 🧧

Chinese EV companies post September sales. BYD once again dominated the sales charts, with monthly NEV sales surging from 174,915 vehicles in August to 201,259 vehicles in September. NIO sales were slightly higher than August numbers, reaching 10,878 (just ahead of Huawei's AITO brand). Meanwhile, Geely's Zeekr brand sold nearly as many as Xpeng, as sales for the latter's vehicles stalled.

Chinese automaker Geely takes stake in Aston Martin. Geely acquired a 7.6% stake in British luxury automaker Aston Martin Lagonda Global Holdings, adding to its portfolio of European brands. Geely also owns Lotus and is the largest shareholder of Polestar and Volvo Cars. In 2018, Geely acquired a 10% stake in Mercedes-Benz parent Daimler, valued at $9 billion. Aston Martin plans to launch its first EV by 2025.

NIO continues momentum with ET5 deliveries and Europe Launch Event. NIO officially began deliveries of the hotly anticipated ET5, which takes square aim at the BMW 3 series and Tesla Model 3. Meanwhile, mark your calendars for October 7: NIO will host its official European launch event under the theme "A New Horizon", in Berlin. The event will be livestreamed and will kickoff sales in broader Europe. 

China extends NEV purchase tax exemption to end of 2023. China's Ministry of Finance, State Taxation Administration and Ministry of Industry and Information Technology (MIIT) announced the news through a joint statement. The move aims to support the continued development of the sector and boost consumption amid a weakening global economy (consumers can save up to RMB 10,000, or $1,400, on NEV vehicles). This marks the third time the policy has been extended since its introduction in 2014.

Leapmotor shares sink after Hong Kong IPO. Shares of the EV maker tumbled 33% on Friday in an undersubscribed listing which priced shares at the low end of the expected range. The company raised $770 million in the listing.

Xiaomi-backed startup unveils electric sports car priced under $42,000. China Car Custom, a startup backed by smartphone giant Xiaomi, unveiled the SC01 in an online launch event. Deliveries are said to be planned for the first quarter of 2024. And while smartphone makers Xiaomi and Huawei are getting into the EV game, EV companies like NIO are preparing smartphones of their own - NIO's expects to arrive by the end of 2023.

🗓️ Last Week Today 🗓️

Porsche IPO starts strong, ends flat. Volkswagen at last spun off Porsche on the Frankfurt Stock Exchange yesterday. The IPO was Europe’s largest in a decade. Shares ended flat, still a standout performance amid a broader decline in European and US markets.

Faraday Future might have a future. The EV startup resolved a highly contentious battle between top shareholders and the board. The company’s executive chair and another director will step down and shareholders will end litigation. Faraday also secured up to $100m in funding, but further delayed SOP of the FF91 to Q4.

New York follows California with zero-emissions EV mandate. Just one month after the California Air Resources Board voted to adopt Advanced Clean Cars II, NY Governor Kathy Hochul announced Thursday that all new passenger vehicles, pickups and SUVs sold in New York state must be zero emissions by 2035. Per the 1970 Clean Air Act, other states can adopt California’s policies but can’t implement their own standards.

Toyota Chief says meeting California requirements “difficult”. Meanwhile, in a meeting with U.S. journalists, Chief Akio Toyoda said that the company’s EV transition would take longer than expected and that meeting California's 2035 mandates would be challenging. He promised a wide array of powertrains to propel cars cleanly, including EVs, hybrids, hydrogen and gas-powered models.

Polestar 3 teased ahead of upcoming reveal. The 2023 Polestar 3 will be the company’s third model and first crossover SUV. The debut will be in Copenhagen on October 12 and will be live-streamed. The Polestar 3 will deliver up to 510 horsepower and have a range of 348 miles.

Fisker marches towards November start of production. 95 Ocean pre-production prototypes have rolled off of manufacturing partner Magna Steyr’s production line in Graz, Austria. Fisker says that it is on track for its November 17 start of production date. It will first bring the Ocean to the Paris and Oslo motor shows in October.

NIO warns that energy crisis is slowing European expansion. Founder and CEO William Li visited Europe this week and said that higher energy prices were slowing the rollout of its battery swapping stations. NIO started selling in Norway last year. Its larger Europe debut event is scheduled for October 7.

Ford hires new COO for China. Sam Wu joins from appliance maker Whirlpool, where he served as President of Asia Pacific. Earlier roles included CEO of Osram’s Asia-Pacific business and VP and regional GM for Honeywell Process Solutions, Greater China. The company is making big changes in China with the launch of a new subsidiary, Ford Electric Mach Technologies, and a new direct-to-consumer model.

GM 2023 Cadillac Lyric now shipping in China. Shipments of the new EV began following the official launch in June. The first Lyrics left the SAIC-GM Cadillac plant in Jinqiao on September 28 headed for local dealers. The EV has a starting price of RMB 439,700 ($61,070), and an Ultium battery-powered range of 312 miles.