In Focus: EV Wars Update
It's been a busy couple of weeks in the EV space. We've had delivery reports, delivery date announcements, official test drives, factories bought and sold, as well as manufacturing rights bought and sold.
In my piece on the Rivian IPO a few weeks ago, I spoke on the electric vehicle wars heating up, and over the past few weeks, the moves made by some major players have turned the heat up even more. Here is some of news that occurred over the past several days involving some of the major players in the EV wars.
Tesla ($TSLA) recently released its delivery numbers for Q3 2021. The company reported that it delivered 241,300 vehicles during the quarter, topping analyst estimates of 220,900. Deliveries in Q3 also topped Q2 2021 deliveries by 20%.
Tesla's Model 3 and Model Y accounted for close to 229,000 of the total deliveries for the quarter, and nearly 9,000 Model S and X vehicles were delivered during the quarter.
Last week a lucky few got the chance to visit the Lucid Group ($LCID) plant in Arizona for a tour and test drive of the Lucid Air Dream. From everything I've read, the car is spacious, and has a luxurious fit and finish to it. The Range edition of the car offers 520 miles of range, which is more than any Tesla, and the Performance edition of the Air comes with 1,111 horsepower.
Lucid expects deliveries to start in October, but if you haven't already reserved your Lucid Air Dream, you'll have to wait a little longer. The Air Dream Edition has already sold out and Lucid has closed reservations.
Though I've talked about holding off on an investment in Lucid, what I've read about the car from people who have taken it for a test drive has made me rethink my original position. Specifically the part about the car's fit and finish. I've seen too many Tesla's with uneven spacing between the hood and fender, and a number of other build quality concerns. Elon's personality, and the cult that is Tesla owners has caused many people to overlook these issues, but for how long? If Lucid can keep its delivery date of October, I'll definitely have to revisit the stock.
It's been a busy few weeks for Rivian. In September the company started deliveries of its R1T pickup truck. A feat that has been severely downplayed, likely because the company isn't a public company yet. Rivian was able to beat Tesla, Lordstown Motors ($RIDE), Ford ($F), and GM ($GM) to market with a functional electrical pickup truck. It's a kick to the gut of Ford and GM, whose F150 and Chevy Silverado trucks, respectively, are among those companies' best selling vehicles.
Rivian won't be private for long. The company has filed its paperwork to go public, and it released its S1 last week. The company's filing has everything I expected. Big losses, big spends, big cash reserves, and big plans. The company lost over $1 billion in 2020, spent $1 billion in research and development over the last two years, has over $3 billion in cash, and has plans to sell vehicles in the U.S. and Canada, and then expand to Western Europe and then Asia.
Foxconn and Fisker and Lordstown Motors
Earlier in the year Fisker ($FSR) completed a manufacturing deal with iPhone manufacturer Foxconn (2354.TW). The deal would allow Foxconn to manufacture a car for Fisker. Last year, Foxconn stated it wanted to be the Android of electric vehicles by creating a platform to help automobile companies make electric vehicles.
For months, the question has been where will Foxconn manufacture Fisker's vehicle, and this week we got our answer. Lordstown, Ohio is where Foxconn will manufacture vehicles. Foxconn purchased the Lordstown Motors manufacturing facility for $230 million.
Does that mean Lordstown Motors is done? Not really. Foxconn, purchased the building, made an equity investment in Lordstown Motors, and also secured the right to manufacture Lordstown's electric pickup truck, the Endurance.
As for Fisker, Project PEAR (Personal Electric Automotive Revolution) is expected to start production in 2023. Fisker's SUV, Ocean, will be manufactured in Europe by manufacturer Magna Steyr. The production of the Ocean is scheduled to begin in late 2022.
Winners and Losers
In this update of the EV wars, I would call Tesla, Lucid, Rivian, and Lordstown winners and Foxconn the big winner.
Tesla's deliveries in Q3 show that people are still all in on the Tesla brand. Tesla continues to lead the EV charge and build upon its lead in the EV space.
The Lucid test-drive reviews have been good so far, a spacious car with a luxury fit and finish. I keep harping on the fit and finish, and it's because I've seen enough Teslas with a terrible fit and finish. Lucid could be the competitor to Tesla that the markets have been waiting/hoping for.
Rivian, they did it, they produced and delivered an electric pickup truck before Tesla, Lordstown Motors, Nikola ($NKLA) (who scraped their pickup truck plans), GM, and Ford. As I alluded to earlier, the Ford F150 is the top selling vehicle in the U.S. followed by the Chevy Silverado, why Ford and GM didn't make producing an electric version of those trucks a priority will always confuse me. Rivian has set itself up nicely to take some of Ford and Chevy's share of the pickup truck market.
Lordstown is another company that won this week. Since May of this year the company has been open about its cash problems and delays, especially after word got out that it wasn't close to producing the truck it promised, and it appears the expected delivery for the Endurance is being pushed back again. In August the company's plans were to start production of the Endurance in September of this year and begin deliveries in Q1 2022. Now it appears deliveries won't take place until mid to late 2022. The $230 million received for the plant and the $50 million equity investment from Foxconn should go a long way in helping to stabilize Lordstown. The company has had a tough go of it alone, this partnership with Foxconn could be exactly what the company needs to get it back on track.
Foxconn is the big winner in this round of EV news and updates. Securing the rights to manufacture vehicles for Fisker and Lordstown, while also picking up a factory that Lordstown has already spent big money outfitting to produce electric vehicles is a very nice win. Foxconn also has a deal in place with Chinese automaker Geely to manufacture its vehicles. The company's plan of becoming the Android of electric vehicles is starting to take shape.
In this round Fisker wasn't a winner, but I wouldn't call it a loser either. The production date for the Ocean is just too far out to put it in the mix.
The losers in this round are Ford and GM for the reasons I've stated above. Ford's electric F150 is expected in spring 2022, but I have very little faith in that delivery date. The electric Chevy Silverado isn't expected until 2023.
The EV wars are heating up and getting more exciting by the week.