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There is a bonafide and undeniable bubble in electric vehicles led by Tesla.
Tesla is now almost 50% larger than Toyota. Tesla will likely produce less than 1 million cars this year. As of pre-market, they will be the 11th largest market cap company in the U.S.
The EV dreamers seem to expect the electric vehicle market to become a winner-take-all situation. That’s an odd conclusion given that many global auto companies are national champions offering good jobs and will likely get support from their governments if Tesla begins to dominate.
EVs are also likely to become extremely commoditized as electric motors tend to be much simpler than internal combustion engines.
Bloomberg has more on the mania underway in EVs.
Fisker Inc., the second battery-powered car venture founded by longtime auto designer Henrik Fisker, will merge with an Apollo Global Management-sponsored blank-check company amid a surge in electric-vehicle shares.
The boards of Fisker and Apollo-backed Spartan Energy Acquisition Corp. have unanimously approved the transaction, which is expected to be completed in the fourth quarter, according to a statement. Spartan Energy shares, which soared 54% last week in anticipation of the deal, rose as much as 29% shortly after the start of regular trading Monday.
The more than $1 billion of gross proceeds generated will fully fund the development of the Fisker Ocean electric SUV, which is scheduled to start production in late 2022, according to the company. It’s pursuing a strategy similar to Nikola Corp., which is developing semi trucks powered by batteries and fuel cells and merged with a special purpose acquisition company last month.
Since its listing on June 4, shares of Nikola — which is projecting zero revenue this year — have surged more than 60%. Electric-car stocks are rallying as Tesla Inc. weathers the global pandemic better than feared and boosts hopes for companies trying to replicate its success.
Henrik Fisker’s first venture, Fisker Automotive, filed for bankruptcy in 2013, costing U.S. taxpayers $139 million. That company was acquired the following year by Chinese auto-parts maker Wanxiang Group and renamed Karma Automotive.
Read more here.
