Summary List Placement
As Tesla was busy becoming the most valuable automaker in the world, minting a market capitalization well over $350 billion, a bunch of new names were entering the electric-vehicle race.
Lucid, Nikola, Fisker, and more either made big announcements or pulled the cover off new, Tesla-fighting designs. Nikola and Fisker both went public in 2020 through “special purpose acquisition companies.” For Nikola, that meant an initial valuation of over $3 billion that quickly shot up to $13 billion, and for Fisker, a $3 billion valuation with a cool billion earmarked to bring the carmaker’s first vehicle, the Ocean, to market.
Lucid unveiled its Air sedan last week, amid considerable hoopla. Understandable, as the $170,000 top-trim of the car has performance specs that put the Tesla Model S in the rearview.
It gets better. Fisker has rolled out plans to produce a family of three vehicles and, in interviews with Business Insider, CEO Henrik Fisker outlined a business model that seeks to turn the traditional paradigm of auto ownership on its head.
Meanwhile, Nikola teamed up with General Motors, trading 11% of the company’s equity — $2 billion — as well as $700 million in “reimbursements” to manufacturer the Nikola Badger pickup truck, using GM’s Ultium battery technology.
And don’t forget about Rivian, which was the talk of the auto-circuit in 2019 (back when there were auto shows) and looks like the old man of this group, thanks to a $500-million investment by Ford last year.
That’s a lot of action, but how about some context? Lucid has been around, in one form or another, since 2007, and got a huge shot in the arm financially in 2018 when the Saudi sovereign wealth fund invested at a $1 billion valuation. Skeptics could argue that it took the startup 13 years to reveal one car, which looks fantastic on paper but isn’t, well, you know, built yet.
Nikola founder Trevor Milton wisely realized that manufacturing the Badger while also bringing a semi-truck to market was too heavy a lift, so he effectively hired GM to make the pickup, turning it into a showcase for Ultium, a technology that GM has ambitious plans for over the next decade.
Fisker has been arguing, refreshingly, that the old manufacturing model is hopeless for startups. So he’s transformed himself, in his latest auto industry act — he founded Fisker Automotive before the financial crisis and was widely seen as an early Tesla rival — into a vocal advocate for asset-light car-making, with a focus on customer experience, rather than nuts and bolts.
The difference between this next-generation trio of electric carmakers and Tesla is obvious: Tesla did it the hard way, with a modest 2010 IPO that raised around $260 million, followed by a decade of slogging through what CEO Elon Musk has often called “production hell.”
The reward is the titanic market cap and the awe of Wall Street. But Tesla still sold only 367,500 vehicles in 2019, while GM alone sold nearly eight million. It took Tesla …read more
Source:: Business Insider