Key takeaways

• Funding
  • Mega rounds cooled down after four heavy quarters: The Passenger Mobility Tech space raised USD 2.7 billion over 15 rounds, significantly lower than ~USD 7 billion raised in Q1 2024 and Q2 2023. This was due to the absence of mega rounds mainly in the EV Economy sector. The funding decline in EVs seems to have been compounded by challenges in the market, with EV maker Fisker filing for bankruptcy during the quarter.
  • Smart Mobility Information and Passenger eVTOL Aircraft sectors also experienced notable declines in investment in Q2. Conversely, Auto Tech and Shared Mobility saw YoY increases, driven by major investments in Wayve and BlaBlaCar, respectively.

• Partnerships
  • Renault entered into autonomous passenger vehicles, while other players focused on AI integrations: Renault introduced a Level 4 autonomous minibus tailored for public transport in partnership with tech providers (including EasyMile, Milla, and WeRide). Most other partnerships focused on developing safety and driving assist tools, with an emphasis on intelligent driving solutions using AI and other advanced technologies. The most notable deals included Mercedes-Benz, Toyota, Cherry, and BMW.
  • The expansion and enhancement of charging infrastructure continued:  Notable collaborations in the EV Economy included automakers teaming up with third parties to expand EV charging networks (e.g., Toyota and Tata Motors) or access existing networks (e.g., Vinfast and NIO). Passenger eVTOL Aircraft startups also concentrated on infrastructure building, while many continued receiving eVTOL aircraft orders.
  • Northvolt faced a big setback: BMW canceled its EV battery cell purchasing agreement with Northvolt due to the latter’s inability to deliver the batteries on schedule. BMW intended to use Northvolt's cells for its fifth-generation batteries, which were originally scheduled for production in 2024. Now the order will be fulfilled by Samsung SDI, with BMW and Northvolt continuing their relationship, with the latter planning to supply the next-generation battery cells that BMW needs for its Vision New Class EVs.

• Product updates
  • Autonomous vehicle makers updated technologies and continued testing in new geographies: Autonomous vehicle tech companies like Amazon’s Zoox, Waymo, and General Motors’ (GM’s) Cruise continued to expand their testing efforts to different geographies while further upgrading the technology. Waymo remains at the forefront, advancing its commercial driverless taxi service with recent expansions into San Francisco and Los Angeles. Some companies including Helm.ai and Wayve introduced testing and validation features for advanced driver assistance systems (ADAS) and autonomous driving tech development. Nevertheless, persistent business closures and launch delays highlighted the enduring challenges within the sector.
  • EV updates centered on investments in unit production and developing new battery technologies: Major automakers like Toyota and Honda are investing in EV manufacturing facilities, while Ford commenced mass production of an EV. Meanwhile, Automotive Cells Company (ACC) and CATL were actively looking to introduce more efficient and cost-effective battery technologies.
  • The Passenger eVTOL Aircraft industry saw new products, continued product testings, and initiatives directed at enhancing production capacities: These developments were marked by aircraft unveilings by Sirius Aviation and Supernal LLC, Archer Aviation’s successful flight test in California, and Lilium’s potential investment in large-scale production in France.

• M&As
  • Hyundai backed Motional to prevent its collapse; Wisk Aero nabbed a startup to enhance software security: Only two notable M&A deals took place and were both related to the Auto Tech and Passenger eVTOL Aircraft industries: 1) Hyundai acquired self-driving tech company Motional, resulting in Hyundai controlling 85% of Motional (May 2024), and 2) Wisk Aero acquired Verocel, a software verification and validation company (June 2024).

• Regulations
  • Regulations and approvals to facilitate safer autonomous vehicle and eVTOL aircraft deployments: Recent developments include new legislative actions in the UK and California, vetoes in Kentucky, investigations into industry leaders (Waymo and Zoox), and strategic moves by Chinese firms (Pony.ai and Momenta) amidst geopolitical tensions. Meanwhile, companies worldwide secured approvals for eVTOL deployments (Archer Air, Archer Aviation, and EHang), with notable progress in the US and China. 
  • The US Government injected funds to strengthen the EV ecosystem: In May 2024, the US opened applications for a USD 1.3 billion funding opportunity for EV charging and alternative fueling infrastructure in urban and rural communities and along designated highways, interstates, and major roadways.

• Outlook
  • Autonomous vehicles steadily moving toward commercialization: The growing involvement of active incumbents including Alphabet, GM, and Amazon in autonomous vehicle technologies signals a promising outlook for future large-scale commercial deployments. This is evidenced by product updates, such as testing vehicles in diverse geographies, weather conditions, and driving scenarios (e.g., Zoox, Waymo, and Cruise) and partnerships focused on developing and deploying autonomous vehicles. These efforts are crucial for building public trust in the technology, which remains a significant challenge, as fear of self-driving vehicles has increased in recent years (66% of the US population feared autonomous vehicles in 2024, up from 55% in 2022). We believe that strengthening regulations in the US (e.g., California) should help gain public trust in the long run. The trend of developing intelligent driving solutions using AI and other advanced technologies is expected to continue, resulting in more advanced driver assistance systems. 
  • The Passenger eVTOL Aircraft industry also marching toward commercialization: The industry benefits from regulators setting the environment, companies securing permits and aircraft orders, and several other partnerships with infrastructure providers, all indicating positive signs for commercialization in the future. Consumer sentiment also remains positive, with ~75% of consumers willing to try out the technology within a year of its arrival.
  • Development of EV charging infrastructure and affordable EVs to continue: Public EV charging remains a pain point due to various incompatible charger types, variable charging speeds, and complex payment systems. Additionally, the limited availability of fast chargers and the prevalence of technical issues further complicate the user experience. Therefore, for the electric vehicle industry to accelerate, charging infrastructure must become standardized and broadly accessible. Consequently, it is likely that infrastructure providers and EV manufacturers continue to form partnerships and invest in charging solutions, as evidenced by trends in recent quarters (e.g., Toyota, Tata Motors, Vinfast, and NIO). High prices of EVs are also a significant barrier for consumers. This could be addressed by companies continuing to innovate, particularly through developing low-cost batteries, thereby enhancing EV adoption rates.
  • Smart Mobility Information to see growing demand to improve public transit: The Smart Mobility Information industry is poised for significant advancements, emphasizing improving public transit data analytics (e.g., Optibus and Panasonic). These developments highlight a future where enhanced advanced mobility solutions contribute to safer and more efficient transportation networks.