EV Roundup: TM’s Big Electrification Bet & NIO Day Event Take Center Stage

Last week, Japan-based auto biggie Toyota TM announced an extensive electrification drive in a bid to secure a solid footing in the red-hot EV space. China’s key EV player NIO Inc. NIO grabbed attention with its much-awaited annual NIO Day Event held in Suzhou in China on Dec 18, 2021, to shape the future of transportation.

Meanwhile, in an attempt to cash in on the increasing investors’ appetite for EV makers, U.S. iconic motorcycle maker Harley-Davidson HOG announced plans to make its e-bike unit LiveWire public via a SPAC merger.

EV startup Rivian Automotive RIVN released third-quarter 2021 results, which marked the company’s first quarterly release since it went public last month. U.S. auto giant General Motors GM also made it to the top stories of the week as its EV600 light commercial vehicle and GMC Hummer e-pickup made way to customers for first deliveries.

Recap of the Week’s Important Stories

Toyota announced plans to invest 4 trillion yen ($35 billion) for a line-up of 30 battery electric vehicles (BEV) by 2030. This will mark an increase in the company’s BEV count from the 15 models it had earlier planned to launch by 2025. TM also aims to expand global sales of battery electric vehicles by 3.5 million units a year by 2030. The auto giant has earmarked another 4 trillion yen for the development of other electrified vehicles, including hybrids and fuel-cell vehicles, by the end of the decade. Toyota will also take up its investment in battery development to 2 trillion yen ($18 billion) from the previously proposed 1.5 trillion yen.

The big EV push is in sync with Toyota’s efforts to tap the growing market of zero-emission vehicles. By 2030, Toyota anticipates hybrids to comprise more than half of total vehicle sales in the United States, with a forecast of 15% of sales from zero-emission EV and hydrogen-powered cars. The company also aims to achieve 100% sales from BEV for its luxury brand Lexus in Europe, North America, and China by 2030 and globally by 2035.

NIO unveiled a new mid-sized electric sedan, the ET5, at the NIO Day event. It also provided updates on the delivery timeline and unveiled new features of the ET7 as well as global expansion plans. ET5 will be NIO’s fifth product offering. Based on the Technology Platform 2.0 as the company’s flagship ET7 model, the ET5 sedan will be manufactured at the NEO Park facility along with the ET7. The ET5 will start retailing at RMB 328,000 ($51,000) for a 75-kWh battery pack (before the application of subsidies). The delivery of ET5 is expected to commence in September 2022.

NIO also provided a starting date of Jan 20, 2022 for order confirmations of its upcoming electric sedan offering ET7. Deliveries of this upscale sedan are set to begin on Mar 28, 2022. ET7’s drag coefficient has been improved to 0.208, thereby improving the EV’s range to 550 km with the standard 75-kWh battery pack. The company also notified about plans to tap into Netherlands, Sweden and Denmark in 2022. It also plans to expand to more than 25 countries and regions globally by 2025.

Harley-Davidson’s LiveWire unit is set to merge with AEA-Bridges Impact Corp. (“ABIC”) in a deal valuing the combined entity at $1.77 billion. With that, LiveWire will become the first publicly-traded e-bike company in the United States. The deal will be funded by $400 million in cash held by ABIC and a $100 million investment each by HOG and Taiwan-based scooter manufacturer KYMCO. Subject to satisfactory closing conditions and the approval of ABIC shareholders, the deal is scheduled for closure in first-half 2022. Upon closure, LiveWire will trade on the NYSE under the symbol “LVW”.

The combined entity is expected to have an enterprise value of $1.77 billion and a post-money equity value of $2.31 billion at closing. Harley-Davidson will own a 74% stake in the new company. ABIC’s shareholders will own around 17%, and ABIC’s founders and KYMCO will hold roughly 4% each. By making its e-motorcycle unit public via a SPAC deal, LiveWire will reap net proceeds of about $545 million, which would help boost the go-to-market model and investments in new product offerings as well as bolster manufacturing and distribution capabilities.

HOG currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Rivian incurred third-quarter 2021 net loss of $1.23 billion, which fell within its previously announced expected range of $1.21-$1.28 billion. Loss per share and revenues came in at $12.21 and $1 million, respectively. Rivian expects bleak production in the coming months, with an expected shortage of “a few hundred vehicles” from its 2021 target of 1,200 vehicles. Impediments to the supply chain, coupled with challenges in hoisting production of complex batteries required to power the vehicles, are expected to hurt production.

In a separate development, Rivian is looking to expand manufacturing operations with a second U.S. plant in Atlanta, GA. It is planning for a vehicle assembly and battery plant located in a carbon-conscious campus in Morgan, Atlanta and Walton Counties. With an investment of $5 billion, the Georgia plant will have an annual production capacity of 400,000 vehicles. Construction is expected to commence in the summer of 2022, with production scheduled for 2024. It is also augmenting capacity at its plant in Normal, IL, with plans to increase the workforce by second-quarter 2022.

General Motors hit a major milestone toward an all-electric journey with the commencement of customer deliveries of the GMC Hummer e-pickup. This will be the first EV based on the firm’s proprietary Ultium architecture, a platform that will support GM’s upcoming green vehicles. General Motors plans to release 30 new electric vehicles globally by 2025, with Ultium being at the heart of the company’s new era of EV growth.

General Motors also confirmed the first deliveries of all-electric EV600 vehicles to FedEx. The build completion of EV600 was attained by BrightDrop in a record-setting development timeline of just 20 months, being the fastest vehicle to market in General Motors’ history. This accomplishment is even more praiseworthy as it comes amid global supply-chain headwinds, which the entire auto sector is currently battling. The achievement was made possible owing to GM’s unique operations set-up, highly flexible Ultium battery platform and an agile approach to manufacturing development.

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What’s Next in the Space?

Stay tuned for announcements of upcoming EV models and any important updates from the red-hot industry.

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