Global shares were diving on Thursday after the autonomous-driving systems company said it expects a 50% fall in revenue in the first quarter of the year. The disappointment is also a blow to its former parent and majority shareholder.
Intel owns 87%
While many American analysts insist buyers “don’t want electrics, they want Teslas (NASDAQ:TSLA),” Chinese brands are increasingly dominant.
BYD now sells more cars than Tesla, and Li is growing faster than Tesla. European buyers seem to be holding off on purchases, awaiting low-cost Chinese EVs.
American politicians label China a climate criminal. But it’s the U.S. that now pumps more oil than any nation ever has. China is also dominant in green technologies like solar panels and EVs. Efforts by General Motors (NYSE:GM) and Ford Motor (NYSE:F) to compete are sputtering.
The Biden administration’s incentives for buying EVs are focused on middle-income buyers purchasing made-in-America cars. But that’s not where the market is going.
The best test of these new market assumptions is Nio, which is far ahead of its rivals in its export drive. Nio has gotten $2.2 billion from Abu Dhabi to fund European exports. It will launch a low-price brand called Firefly in Europe later this year.
Li, meanwhile, is undergoing its own electric transition, with plans to launch an EV costing under $30,000.
This week all chinese EV firms and the entire EV market in US went through a consolidation. There are many reasons like profit taking, healthy pull back are being discussed. Chinese EV went down not because of the chinese Bill .
DiamondPeak (ticker: DPHC) is buying the EV startup. That’s the company that investors can trade which will morph into Lordstown Motor eventually. When the deal is done, DiamondPeak will change its stock ticker to RIDE.
“We are thrilled with the opportunity to build Lordstown Motors into a top-tier electric truck company that is highly differentiated from the competition,” said Lordstown CEO Steve Burns in the company’s news release.
The transaction will raise about $675 million for Lordstown and values the company at about $1.6 billion. That makes a 10% stake held by the electric-van maker Workhorse (WKHS) worth about $160 million.
DiamondPeak is up 25% in premarket trading. Workhorse stock is rising, too, with a gain of 4%.
In addition to its 10%, Workhorse earns a royalty on sales of Endurance trucks, the ones Lordstown will sell. The deal should be a positive for Workhorse stock.
Workhorse investors, however, are most interested in the U.S. Postal Service. Workhorse is bidding for a contract to replace hundreds of thousands of Post Office vehicles. A decision is due this fall.
A lot of electric vehicle startups have taken the SPAC route to market including Fisker, Hyliion and heavy-duty truck maker Nikola (NKLA) to name a few. Chinese based Li Auto (LI) looks like an outlier selling shares to the public in a traditional IPO.
There has been a lot of EV activity in 2020. The space is hot, helped, no doubt, by the incredible performance of Tesla (TSLA) shares in 2020. Tesla stock is up about 240% year to date. Tesla is now the world’s most valuable car company.
The Lordstown Endurance is slated to enter the EV competition with a release in 2021. The truck will get a targeted 75 miles per gallon and the company has secured about $1.4 billion worth of preorders.
“Our platform is rooted in sustainability, and the entire Lordstown team is committed to ensuring we contribute to a healthier planet for generations to come,” added Burns.
Coming into the deal, DiamondPeak stock was up about 3% year to date, a little better than comparable returns of the S&P 500 and Dow Jones Industrial Average.
The Guangzhou carmaker still may add to its haul before the IPO, the people said, as investor interest in EVs increases following gains in shares of Tesla Inc. and the U.S.-listed Nio Inc. this year. Xpeng competes against those two companies and a raft of other startups in China, the world’s largest EV market.
The company has filed confidentially to the U.S. Securities and Exchange Commission to go public as soon as this quarter, the people said.
Xpeng delivered 5,185 units of its first vehicle, the G3 crossover, in the first half. It started deliveries of its second model, the P7 sedan, in July, shipping 1,641 units that month.
Shares of Chinese electric-vehicle maker Kandi Technologies (NASDAQ:KNDI) were trading lower on Friday afternoon, two days after a surprise rally that more than doubled its share price.
As of 3:15 p.m. EDT, Kandi's American depositary shares were down about 13.4% from Thursday's closing price -- but still up about 83% for the week.
Kandi's stock price jumped 140% on Wednesday afternoon, after the company said that it will launch two of its small electric cars in the United States at a virtual event on Aug. 18. Interested customers will be able to reserve the Kandis with a $100 deposit at that time, the company said.
The two cars that Kandi plans to bring to the U.S. are hardly Teslas. They're both urban commuter cars with small battery packs and, shall we say, modest performance. Kandi's U.S. flagship, the K23, is an upright four-door hatchback with an estimated range of 188 miles, a price of about $30,000 before incentives, and a very un-Tesla top speed of just 70 mph.
KANDI'S K23 DOESN'T LOOK OR PERFORM LIKE A TESLA, BUT IT WILL COST CONSIDERABLY LESS. IMAGE SOURCE: KANDI TECHNOLOGIES.
That doesn't stack up well against the Chevrolet Bolt or Nissan Leaf, both of which offer better range, top speeds more appropriate to U.S. highways, and nationwide service networks -- and build quality that is known to be high -- for not much more money.
Kandi's other U.S.-bound model, the simpler and cheaper K27, is definitely intended as a city car: It has estimated range of around 100 miles, a price of $20,000 before incentives, and a top speed of 63 mph.
It's no surprise that the company's stock soared on Wednesday's news, given the intense investor interest in electric-vehicle stocks in recent months triggered by Tesla's massive run-up earlier in 2020. Nobody wants to miss out on the next Tesla -- but on closer examination, Kandi might not be the right horse to bet on in that race.
I think auto investors have been doing that closer examination and that's why Kandi's stock fell back on Friday.
The EC6. Image source: NIO.
