Electric vehicles are the future: Tesla, Rivian and Lucid are leading the way in innovation
The automotive industry has had another shake-up over the last few weeks. Rivien, who went
public on the 10th of Nov., became the 5th largest automotive company. Lucid Motors also spiked on the hype to become the 8th largest automotive company. Today, 5 of the top 15 automotive manufacturers are EV manufacturers, while they only sold 0.36% of all the 64 million cars sold in 2020.
Revolution
We are in the middle of the biggest revolution in the automotive industry since Henry Ford’s first production line started in 1913 and brought an end to the horse and carriage business.
Many industry observers believe we have already passed the tipping point and sales of EVs will very rapidly surpass petrol and diesel cars.
EV ‘price parity’ refers to the point at which an automaker can theoretically build and sell an EV with the same margin as a comparable combustion vehicle, assuming no subsidies are available.
According to a recent price survey conducted by BloombergNEF, automakers soon will be producing models that are “as affordable—and as profitable—as comparable combustion engine models, and without the help of tax subsidies.”
What are the incumbent pack doing?
Jaguar plans to sell only electric cars from 2025, Volvo from 2030 and last week the British sportscar company Lotus said it would follow suit, selling only electric models from 2028.
General Motors says it will make only electric vehicles by 2035, Ford says all vehicles sold in Europe will be electric by 2030.
It does seem that Volkswagen’s CEO Herbert Diess has woken up. He told employees at the German carmaker to prepare for the “revolution” needed to take on electric-car pioneer Tesla and Chinese manufacturers.
The German group — whose 12 brands include Audi, Porsche, and Skoda — is pumping $40 billion into the shift to EVs and aims to become the world’s largest electric carmaker by 2025.
But will $40 billion be enough when you consider the access to capital the new entrants now have?
It seems too little too late, and new buyers would prefer a car with a built-in whoopee cushion (tesla have this “feature”), autonomous driving, and even the potential to hover.
Watch here: Tesla’s Insane New Flying Car
Conclusion
Investors are forward-looking, so the hype must contain a certain reality about the future, and yet we see that the incumbents are incredibly slow to move. Not only are they slow to move, but retooling will cost them a fortune, and what is their value add apart from their legacy and reputation?
With a transport industry that is moving away from fossil fuels, it seems that the incumbents could just switch over, but the reality is far deeper, not only are the new entrants revolutionizing the fundamental power source but they are impacting the total value chain from the source of power through charging stations and storage of renewable power to revolution transport insurance and finance.
This is just the tip of the iceberg, the real reason they are so far ahead and leading the revolution of the transport industry is not only the energy and batteries, it is the end game, when all transport will be totally autonomous. The likes of Tesla are light years ahead in development along with a few other companies that could sell the technology to other manufacturers, but then you have to ask yourself, where is the value add?
Even Apple are getting in on the act with their recent announcement “Apple Accelerates Work on Car Project, Aiming for Fully Autonomous Vehicle”
Startups in autonomous vehicle tech
At least Ford has a 12% stake in Rivien, on which it has made more than by selling cars.