The electric vehicle (EV) economy represents a future where battery electric vehicles (BEV) are readily used in transportation. Making up less than 1% of the total passenger vehicles in use, BEVs are presented with significant space for growth, while derived demand from EVs would also bode well for batteries and charging solutions. Falling battery costs and improvements in their range make BEVs competitive against gasoline counterparts. Aggressive electrification targets are also expected to drive the demand over the next few decades. If all proposed sustainability policies and electrification targets are met, the number of BEVs on the road is expected to hit around 95 million by 2030 (from around seven million in 2020).
Strong recovery from the pandemic, with passenger BEV sales increasing by 86.8% YoY in 2021 (from 29.1% YoY in 2020).
Multiple disruptions to business operations over the past two years due to lockdowns and virus outbreaks.
Rivian, Lucid Motors, Fisker, Lordstown Motors, and Sono Motors experienced delays in launching new models.
Volta Charging, Canoo, and Tesla developed new products to combat the coronavirus.
Battery startups are the most common, with a number of disruptors developing next-gen advancements in lithium-ion batteries as well as solid-state and other lithium-substitutes. Most next-gen battery startups are at the seed stage and their technologies are yet to be commercialized. Charging infrastructure is another segment with strong disruptor presence. Startups in this segment are somewhat mature with most being in the growth stage.
The passenger EVs segment is incumbent-heavy but startups providing differentiated solutions, such as solar EVs and subscription-based payment models, have shown some promise, along with a handful of commercial EV startups. These startups are yet to reach mass market adoption and are mostly in their seed or early stages.
The EV economy has a high number of listed disruptors compared with other industries—13 of the 15 highest funded disruptors were listed as of March 2022. Most of them have done so through SPAC deals. Passenger EV startup Rivian is the highest funded disruptor in the industry, having raised USD 12 billion at its IPO—this made it the largest IPO in the US since 2014.
Meanwhile, lithium-ion battery startup Northvolt is the highest funded private disruptor (USD 6 billion). Other notable private disruptors are mostly next-gen battery startups like Sila Nanotechnologies, Factorial Energy, Enevate, and Solid Power, while the commercial EV-maker Einride and the EV sports car maker Rimac Automobili have also raised more than USD 150 million.
More listed players also means that funding is somewhat concentrated, with the top 15 accounting for more than 90% of the total funds raised (among the top 50 highest funded disruptors). The industry is also relatively mature, with an average disruptor having been in operation for over nine years.
Rivian develops both passenger and commercial EVs. The company’s portfolio includes an electric SUV (R1S) and an electric pickup truck (R1T). R1S has a range of 316 miles and is offered at a base price of USD 72,500; R1T has a range of 314 miles and a payload of 11,000 lbs with a base price of USD 67,500. A 400+ mile-range R1T with a larger battery pack was also in the pipeline as of February 2022.
Rivian started R1T deliveries in September 2021 and R1S in December 2021. The company has secured a total of 98,000+ net pre-orders for its pickup truck and SUV in the US and Canada as of June 2022 and produced 8,000 vehicles as of August 2022 .
Rivian also collaborated with Amazon to develop an electric delivery van (EDV). Amazon ordered 100,000 EDV units globally to be delivered by 2030, with Amazon having exclusive rights to the vehicle for the first four years. The initial rollout began in July 2022 in over a dozen cities and is expected to spread to over 100 cities by the end of the year. EDVs supplied to Amazon will be complemented by FleetOS, Rivian’s proprietary fleet management platform with a recurring monthly subscription fee.
As of February 2022, Rivian operated a 150,000 unit-manufacturing facility in Normal, Illinois, with a proposed 50,000 unit expansion. The company also planned to invest around USD 5 billion in a new 400,000 unit factory in Atlanta, Georgia, expected to come online in 2024. In May 2022, Rivian received a USD 1.5 billion incentive package in state and local incentives and tax credits for its new vehicle assembly facility in Georgia.
Rivian expects to produce 25,000 EVs in 2022. The company generated revenue for the first time in Q3 2021 from early R1T sales (USD 1 million), while the operating loss for the first nine months of 2021 was USD 1.8 billion (+164% YoY). Rivian was listed on NASDAQ in November 2021. The company raised USD 12 billion at the IPO—the largest by a pure-play EV company.
EV Batteries: Li-ion:
Almost all major automakers have some form of electrification plan, which explains the strong incumbent presence in the passenger EVs segment. Among the top automakers, Volkswagen and the Renault-Nissan-Mitsubishi Alliance lead in terms of electrification, while automakers like General Motors, Ford, Toyota, and BMW are gradually ramping up their EV models and capacity. Meanwhile, Tesla, as the global market leader in the segment, holds a unique position as a pure-play incumbent.
The lithium-ion battery segment is also dominated by incumbents. Most of them have gained a foothold in the market by leveraging their in-house capabilities as diversified electronics players and long-standing partnerships with automakers. While incumbents have a somewhat limited presence in next-generation EV batteries, several automakers, as well as lithium-ion battery supplier Samsung, are developing solid-state batteries.
Shell and bp are two key incumbents in the EV charging infrastructure segment, having acquired two leading fast-charging suppliers ubitricity and Pulse, respectively. EV charging stations are a part of the two O&G players’ net-zero emission plans. Both ABB and Siemens are also prominent in this space. Meanwhile, incumbent presence in the commercial EVs segment is also somewhat limited, with just Daimler and Volvo having made any significant progress. EV and battery management solutions is another segment with little to no incumbent presence.
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