ReportWire

Tag: electricvehicles

  • This EV company has a bigger market cap than Ford or GM. But you may not have heard of it.

    This EV company has a bigger market cap than Ford or GM. But you may not have heard of it.

    [ad_1]

    Shares of electric-vehicle startup VinFast Auto Ltd. have surged since the company went public through a special-purpose acquisition company deal last week, taking its market capitalization to levels well beyond established automakers such as Ford Motor Co. and General Motors Co.

    Shares of low-float company VinFast
    VFS,
    +40.35%
    rose 16.1% Friday, after ending Thursday’s session up 32.3%, sending the company’s market cap to $231.3 billion. In comparison, Ford’s
    F,
    +1.36%
    market cap is $47 billion and GM’s
    GM,
    +0.21%
    is $45.2 billion, according to FactSet data. Rival EV maker Rivian Automotive Inc.
    RIVN,
    +2.19%
    has a market cap of $18.6 billion. However, all of these are dwarfed by Tesla Inc.’s
    TSLA,
    +3.72%
    $730.2 billion market cap.

    In roughly a week, the VinFast stream on Stocktwits, a social platform for investors and traders, has racked up about 3,000 watchers, and message volume is “pretty consistent” throughout the day, Tommy Tranfo, Stocktwits’ head of community, and Tom Bruni, a senior writer for the platform, told MarketWatch Thursday.

    Related: EV startup VinFast may be worth more than Ford or GM, but there’s a catch

    “What everyone is discussing is whether or not the current hype in the stock is warranted given where the business is,” Tranfo and Bruni said in a statement emailed to MarketWatch Thursday, noting the company’s soaring market cap. “That’s despite the underlying business doing less than $1 billion in revenue, having negative cash flow from operations of $1.5 to $2 billion.”


    Uncredited

    In the short term, the stock is trading on momentum and hype, according to Tranfo and Bruni. “But eventually, its business results have to justify the valuation. And as we’ve seen with other startups in the space, it’s easy to say they’re going to accomplish XYZ, but harder to actually execute and produce results,” they said.

    “From the community side: [We] think what we’re paying attention to the most right now is if this hype sticks,” they added.

    Related: Rivian, Lucid and XPeng make the list of 20 EV companies expected to grow sales most quickly through 2025

    The EV maker is a majority-owned affiliate of Vietnamese conglomerate Vingroup, one of the largest publicly traded companies in Vietnam. VinFast said that as of June 30, 2023, the company has delivered close to 19,000 EVs.

    About 99% of VinFast’s shares are controlled by Vingroup chair and VinFast founder Pham Nhat Vuon, making only a small portion available to investors.

    Stocktwits’ Tranfo and Bruni noted that EVs have a good track record of growing strong retail community support. “So there is reason to believe that this momentum could continue, but it may be too early to tell for sure,” they added. “Retail loves the electric-vehicle industry, so the interest is likely to continue regardless of how well the company (and stock) actually perform.”

    Related: Tesla’s stock jumps 7% after Baird highlights Cybertruck, other ‘catalysts’ for the year

    VinFast is importing its vehicles into the U.S. and is also ramping up its North American presence. In July, the company broke ground on an electric-vehicle manufacturing site within the Triangle Innovation Point in Chatham County, N.C. The EV startup says the plant will eventually have the capacity to make 150,000 EVs a year.

    Claudia Assis contributed.

    [ad_2]

    Source link

  • Ford is going all in on hybrids. Here’s why.

    Ford is going all in on hybrids. Here’s why.

    [ad_1]

    Ford Motor Co. is betting that hybrid vehicles will be the bridge toward an all-electric-vehicle future for perhaps longer than most people expect. It’s a cautious strategy that has its admirers on Wall Street.

    Ford
    F,
    -4.48%
    is not thinking about “extremes” between hybrids and EVs, company Chief Executive Jim Farley said recently. The automaker decided to keep investing in heavy-duty hybrid vehicles and has been surprised by their popularity, he said.

    That’s a “subtle shift of strategy” for Ford, but one that makes sense in the current reality, said Garrett Nelson, an analyst with CFRA.

    On the call with analysts following Ford’s quarterly results last month, Farley noted that Ford’s hybrid offerings are extremely popular. About 10% of F-150 pickup trucks and 56% of smaller Maverick pickup trucks being sold in the U.S. are hybrids, he said.

    “We are adding hybrid options across our [internal-combustion-engine] lineup,” he said. “And we expect to quadruple our hybrid sales in the next five years, and we were already No. 2 in the market last year.”

    The pure-battery EV market has become saturated, and Ford is indicating that it is willing to be flexible, CFRA’s Nelson said.

    “Bottom line, aside from Tesla
    TSLA,
    +1.30%
    EVs, the vast majority of other EV models have sold very poorly,” Nelson said, adding that although many people are not interested in EVs, hybrids could be an easier sell.

    Related: Electric vehicles vs. gas-powered cars: Which one is cheaper to buy and own?

    “Consumers are becoming much more educated,” he said. “You can in a lot of cases go on pure battery power and not even use any fuel with these hybrids.”

    Japanese carmakers such Toyota Motor Corp.
    7203,
    +1.40%

    TM,
    +0.26%
    and Honda Motor Co.
    7267,
    +5.87%

    HMC,
    -0.09%
    have taken that approach from the start, making much bigger bets on hybrids, and “in hindsight that appears to have paid off,” Nelson said.

    Indeed, “hybrids are a much easier purchase in today’s environment,” said Karl Brauer, an analyst with iSeeCars.com.

    “They cost less than electric vehicles, they don’t involve range anxiety, and Ford has managed to make them quite practical in how it pairs the technology with the F-150,” Brauer said.

    Hybrids are more expensive to buy than internal-combustion-engine vehicles, but they are cheaper than electric vehicles because their batteries are significantly smaller — even those in plug-in hybrids, which are capable of driving several dozen miles solely on an electric charge. About a third of the cost of an EV is the cost of the battery.

    Hybrids have one more critical advantage over EVs, Brauer said — they can be produced and sold for a profit.

    Ford’s strategy contrasts with a more aggressive EV push by General Motors Co.
    GM,
    -5.79%    ,
    Nelson said.

    GM late Wednesday unveiled its Cadillac Escalade IQ, a luxury EV that starts at around $130,000 and has 450 miles of range. GM expects to begin making the vehicle in the summer of 2024, with sales beginning in late 2024.

    GM’s future lineup includes a number new EV models as well as electric versions of popular vehicles that were previously available only as gas-powered models. That includes an electric Chevy Equinox for next year and a return of the Chevy Bolt, among the cheapest EVs available in the U.S.

    See also: GM is bringing back the Bolt. What do we know so far about the updated EV?

    GM will cease production of the Bolt later this year but has promised to bring it back using the company’s new shared EV platform. Observers expect the new Bolt to be available around 2025.

    GM’s EV strategy is generally viewed as more risky.

    Tesla started a price war earlier this year, cutting prices of its EVs several times. Ford also cut prices, most notably on the F-150 Lightning, the electric version of a pickup truck that’s been the best-selling vehicle in the U.S. since the 1980s.

    Hybrids also do away with so-called charge anxiety, because their gas-powered engines kick in when needed.

    Related: EVs zoomed ahead with a 8.2% slice of auto financing pie in second quarter

    According to a Consumer Reports survey in June, about 6 in 10 respondents said that concerns about charging were holding them back from purchasing an EV, and about 5 in 10 cited range as a reason they wouldn’t buy one just yet.

    Tesla has made its fast-charging ports the de facto standard in the U.S., and several automakers, including Ford and GM, have inked deals to allow their EV owners to power up at Tesla’s Supercharger network, which has charging stations located near major highways.

    An often-cited 2022 study about the reliability of public, open-to-all fast-charging stations in nine counties in the San Francisco Bay Area found a range of issues with the stations, from charging and payment failures to annoyances such as spaces being occupied by gas-powered vehicles or EVs that are not actively charging.

    [ad_2]

    Source link

  • EV sales stall as, aside from Tesla and BYD, there’s a ‘step back from euphoria’

    EV sales stall as, aside from Tesla and BYD, there’s a ‘step back from euphoria’

    [ad_1]

    For the first time in recent years, sales of electric vehicles didn’t grow as fast as market observers expected, creating what Barclays analysts characterized Wednesday as a “step back from EV euphoria” for companies that are not Tesla Inc. or BYD Co.

    The analysts, led by Dan Levy, said that in 2020 and 2021, Wall Street was “willing to look past EV losses,” betting that demand was “unlimited.”

    “We’ve now seen a market where demand is constrained, capital has been tighter, and there is less tolerance for EV related losses,” the analysts said in a note.

    “Moreover, going a layer deeper, we find that while [Tesla
    TSLA,
    +0.82%
    ] and [China’s BYD
    002594,
    -1.38%

    BYDDY,
    +0.50%
    ] have continued to grow, … growth for the rest of the industry has been less robust in Europe and China,” they wrote.

    Don’t miss: Tesla is looking at its best sales quarter ever

    Global EV penetration volumes have tracked below expectations so far this year, at 13.5% through May, up 50 basis points, or 0.5%, from 2022 and “well below” estimates from BNEF of just under 18%. It is “likely marking the first time in recent years that EV penetration has disappointed,” the Barclays analysts said.

    In comparison, penetration topped 16% for several months in the second half of 2022. While the second half of this year is likely to bring some improvement, it is possible that it will still fall short of expectations.

    Aside from Tesla and BYD, growth has been modest, the analysts said. For Ford Motor Co.
    F,
    -0.07%
    and General Motors Co.
    GM,
    +1.09%    ,
    there are “shades of softness in EV sales,” the Barclays analysts said.

    There are concerns about weak U.S. EV sales and also reports of “sharply rising EV inventory,” the analysts said.

    Citing data from Wards, Barclays pointed at EV inventory of 95,000 vehicles by the end of June, the highest ever, with the highest amount of stock for Ford’s electric Mustang Mach-E SUV, at about 16,000 vehicles in inventory, and Volkswagen’s ID.4, also an SUV, at 14,000 vehicles in inventory.

    GM is not off the hook, either: Despite the company’s increase in EV sales and “robust” market-share gain, much of that came from its Chevy Bolt models, which are nearing the end of production, the analysts said.

    GM announced in April it was phasing out the Bolt and the bigger Bolt EUV, underscoring the challenges in making a profit on EVs despite soaring new-vehicle prices and as several automakers throw all their weight toward a full transition to EVs.

    [ad_2]

    Source link

  • Tesla stock at two-year low, other EV-maker shares plunge as concerns simmer about China, oil futures

    Tesla stock at two-year low, other EV-maker shares plunge as concerns simmer about China, oil futures

    [ad_1]

    Tesla Inc. shares on Monday were poised to end at a fresh two-year low, with shares of other electric-vehicle makers also underperforming the broader equity market as worries about China’s COVID-19 lockdowns re-emerged and oil futures prices dropped to their lowest level since January.

    Shares of Tesla
    TSLA,
    -6.84%
    extended their losing streak to a fourth session and were on track for their lowest close since Nov. 20, 2020, when they closed at $163.20. The stock was the 10th worst performer in the S&P 500 index
    SPX,
    -0.39%
    and fourth worst in the Nasdaq 100
    COMP,
    -1.09%
    — and the most active stock on both exchanges.

    American depositary shares of several China-based EV makers, including Nio Inc.
    NIO,
    -4.30%
    and XPeng Inc.
    XPEV,
    -5.67%    ,
    also underperformed the broader market. In contrast, shares of General Motors Co.
    GM,
    -0.63%
    and Ford Motor Co.
    F,
    -0.29%
    merely edged lower.

    The energy sector was taking a broad beating as well, with the SPDR Energy Select Sector ETF
    XLE,
    -1.35%
    looking at a four-week low.

    Related: GM’s EV roadmap is ‘ambitious,’ but Wall Street doesn’t give it full credit just yet

    Tesla’s underperformance as compared with the broader indexes holds on a monthly and yearly basis as well. The stock is down more than 25% so far in November and 52% this year.

    If the trend continues, this would be the worst yearly performance for the stock on record.

    The S&P has lost about 17% year to date and has clawed back to a 2% gain so far in November.

    [ad_2]

    Source link