As third-quarter earnings roll in, it is a good time to check the state of electrification startups. Spoiler alert: It is not too encouraging.
The list of electrification startups — be they cars, trucks, chargers or infrastructure — is long and littered with failures. That’s OK since tapping out is often a prerequisite to future success. Or so goes the Silicon Valley mantra.
State of the SPACs
With third-quarter earnings as a trigger, it seemed like a good time to assess how companies FreightWaves covers regularly or from time to time are doing. This is not intended to be inclusive. The categories provide a general state of being more than a ranking.
Most of the startups and early-stage growth companies below merged with a special purpose acquisition company. A SPAC is a market-listed shell company created to target and combine with a young company.
Lax listing rules since toughened by the Securities and Exchange Commission allowed SPACs to present rosy projections of revenue and profits. Investors were mesmerized — for a while.
In the pandemic era, when money was cheap, many of the companies went for the gold, thinking it would always be easy to raise more. Now with higher interest rates and a profits-over-promise mentality in the venture capital world, they have found out differently.
Plugging along
EINRIDE: The Swedish startup makes the list because of its truck-as-a-service placement of electric vehicles. But it is much more. It develops teleoperated driverless vehicles and a digitized freight mobility platform called Saga that gathers data and makes the most of its performance. Einride has big customers and ample financial resources to stick around.
SPAC merger: None. Capital raised: $335 million
ORANGE EV: The manufacturer of short-range, low-speed electric terminal trucks for industrial applications throughout the shipping industry is expanding. It serves retail packaging and distribution, rail yards, ports, and terminals. Founded in 2012, Orange has deployed more than 450 Class 8 heavy-duty “yard dogs” to 130 fleets across 28 states, Canada and the Caribbean.
SPAC merger: None. Capital raised: $435 million
XOS: The startup has to give up its original name — Thor Trucks — because the maker of RV equipment had it first. But Xos is making progress in Class 5-8 electric trucks, winning customers and expanding to larger quarters. It is also making mobile charging equipment and serving the electric distribution yard equipment market.
SPAC merger: August 2021. Gross proceeds: $575 million
On the bubble
HYZON MOTORS: The spinoff of Singapore’s Horizon Fuel Cell Technologies has cleaned up multiple problems created by previous leadership. But it needs more money to advance its 200-kilowatt single-stack fuel cell. A merger or acquisition would be welcomed by CEO Parker Meeks, who sees stationary power generation as a possible additional business.
SPAC merger: July 2021. Gross proceeds: $570 million
LIGHTNING EMOTORS: Shareholders recently cleared the way for borrowing that could keep the maker of electric airport shuttles and Class A (small) buses going for a while. But the Colorado company probably needs a big investor to achieve meaningful scale in electrifying GM chassis made at a Navistar plant in Ohio.
SPAC merger: May 2021. Gross proceeds: $268 million.
NIKOLA: One of the highest fliers in the early days of the SPAC boom, Nikola has fallen to earth. Its naysayers and short sellers predict its doom, but the fuel cell truck maker and hydrogen infrastructure developer keeps defying detractors. Those who don’t predict its demise suggest a Netflix drama on the soap opera that has played out in the Arizona desert.
SPAC merger: June 2020. Gross proceeds: $760 million.
Down for a dirt nap
ELMS (Electric Last Mile Solutions): The irony of assembling Chinese-made bodies into small electric delivery vans in a plant that once made the hulking Hummer H2 SUV was too rich to ignore. But financial shenanigans on the part of its co-founders led ELMS to a Chapter 7 bankruptcy liquidation with its assets sold to another startup, Mullen Automotive.
SPAC merger: June 2021. Gross proceeds: $379 million
LORDSTOWN MOTORS: This was always a long shot — converting a massive General Motors car factory to build commercial electric pickup trucks. The wheels began to come off after short seller Hindenburg Research alleged the company was inflating order numbers and faced myriad quality issues. Founder Steve Burns purchased its assets out of bankruptcy for $10 million, a small amount of the money he extracted from selling his shares from the day he was allowed.
SPAC merger: October 2020. Gross proceeds: $780 million
Finger-pointing following bankruptcy
PROTERRA: The maker of electric buses, battery packs and charging infrastructure equipment weathered the pandemic only to find its lenders prevented it from raising more money. Its Chapter 11 bankruptcy filing likely means new owners for its business units. Shareholders were pretty much wiped out in a Nasdaq delisting of Proterra stock.
SPAC merger: June 2021. Gross proceeds: $640 million
VOLTA TRUCKS: The Swedish startup got scant attention here because it focused on European markets. It is the latest to file for bankruptcy reorganization. Unable to attract the investment needed to scale the business, Volta also blamed the bankruptcy of battery pack maker Proterra Inc. (see above) for creating a critical battery supply issue.
SPAC merger: None. Capital raised: $391 million.
XL FLEET: Founded in 2009 as a converter of drivetrains to run on electricity, the SPAC-backed startup once had a $4 billion valuation. But its ambition to expand into charging and other related businesses burned cash much faster than it generated revenue. The SEC sued successor Spruce Power Holding Corp. in late September, alleging XL Fleet misled investors.
SPAC merger: December 2020. Gross proceeds: $350 million
Like this? We may give autonomous vehicle startups a similar treatment later.
California hits electric truck goal early
California has surpassed its 6% goal of zero-emission vehicle (ZEV) truck sales two years ahead of schedule.
The 7,639 battery-electric trucks amounted to 7.5% of the total trucks sold. That’s still a far cry from half of all new medium- and heavy-duty truck sales being ZEVs by 2035 and the ultimate 2045 goal of 100% clean trucks.
California surpassed its passenger vehicle ZEV goal well ahead of schedule — more than 1.5 million ZEV sales two years before the 2025 goal.
The state makes buying the vehicles, which cost up to three times as much as a diesel-powered truck, less pricey. California has distributed more than $780 million to help fleets purchase ZEV trucks.
Briefly noted …
Daimler Truck North America has begun regular production of its Class 6 Freightliner eM2 medium-duty electric trucks in Portland, Oregon.
Southern California Edison and the Center for Transportation and the Environment have deployed the first of a planned 15 hydrogen fuel cell electric medium-duty delivery vans retrofitted from diesel.
Hyzon Motors has appointed Stephen Weiland as chief financial officer effective next Wednesday.
British electric truck maker Tevva is talking to possible merger partners after ElectraMeccanica canceled their planned tie-up.
The first 50 Rizon Class 4-5 medium-duty electric trucks have arrived from Japan. The Daimler Truck-owned Mitsubishi Fuso-based trucks qualify for California’s HVIP voucher program.
Truck Tech bonus: An EV history with Mujeeb Ijaz
Back in June, Truck Tech visited lithium iron phosphate battery maker Our Next Energy in Novi, Michigan, where we interviewed founder and CEO Mujeeb Ijaz. You can catch up with that here if you missed it. What we didn’t share was the lobby of ONE. It is packed with century-old electric vehicles and artifacts. Watch Ijaz explain some EV history and what he’s collected.
That’s it for this week. Thanks for reading (and watching). Click here to get Truck Tech via email on Fridays. And catch the latest in major events and hear from the top players on Truck Tech at 3 p.m. Wednesdays on the FreightWaves YouTube channel.
