EV Makers Going broke

The Twitter writer @forwardcap published a number of tweets about EV Startups going broke, and these were startup companies that had been funded by SPAC – where a shell company buys the EV company. Check out these EV Vehicle article here and here on EV Pickups.

A company can go public within months if it merges or is acquired by a special purpose acquisition company (SPAC), which as its name suggests, is an entity that exists specifically for the purpose of making such an acquisition. The owners of a target company may also be in a better position to negotiate a favourable price from a SPAC that has a limited time frame for making an acquisition, compared with another buyer like a private-equity firm, which may drive a hard bargain.

Going public through an IPO is a lengthy process that involves complex regulatory filings and months of negotiations with underwriters and regulators. Rivian went public, but these other EV startups were funded by SPAC and are struggling.

EV companies going broke is normal

“Tesla & Ford are the only American carmakers not to have gone bankrupt out of 1000’s of car startups. Prototypes are easy, production is hard & being cash flow positive is excruciating”

Elon Musk – Twitter
CompanyTickerPeak Market Cap (billion)Mkt Cap
(Jun 2022)
Revenue Projected (million)(2024)Projected EBITDA 2024Revenue ActualEBIT 2022 ActualStatus
Electric Last Mile SolutionsELMS1.71,900465oChapter 7k
NikolaNKLA342.33,2002130
HylionHYLN80.62,0906020
Lordstown electric MotorsRIDE5.30.355,7006000-385
Fisker IncFSR9.32.510,6002,0000
XL FleetXL3.30.191,40030823-90
RomeoRMO5.80.09115619640-200
Lion Electric CompanyLEV5.50.9253,265767185-50
CanooGOEV5.30.721,430188-530
Faraday Future IntelligenceFFIE3.90.710,5551-500m Projections 2023
Lightning EmotorsZEV1.32251,165
Qantum ScapeQS48414-130Does tech work?
LucidLCID105279,9311.3
Rivian
(Not SPAC)
RIVN1602320,00055-4,462
(2021)
Projections down 38% in 2022
Data from Twitter @forwardcap https://twitter.com/forwardcap/status/1536398577861263361?t=EuM4w4YFCHaGJDkdwr9FEg&s=19
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