Overview
In Q1, BYD passed VW with sales of more than 440,000 cars in China, while VW sold 427,247. This is another great milestone for BYD and for their continued target of becoming the biggest EV OEM in the world. According to the China Automotive Technology and Research Centre, VW has been the best-selling OEM in China since (at least) 2008. It is important to note that last month, BYD stated that one of its key goals for (the end of) 2023 is to overtake VW. This demonstrates waning loyalty/appetite for foreign brands, as Chinese consumers pick affordability over brand loyalty.
Californian regulators have voted to ban the sale of new diesel (big) rigs by 2036 and will require all trucks to be zero-emissions by 2042. This progressive decision has put the state at the forefront of mitigating national tailpipe pollution. Alongside this, the California Air Resources Board unanimously approved the Advanced Clean Fleets rule, which requires new commercial trucks to be electric. This rule is the first of its kind in the world to mandate this. These decisions will improve public health, especially in marginalized communities, that have endured polluted air whilst also mitigating the effects of climate change.
GM reported robust Q1 results, with revenue rising by 11% to $39.99bn, which beat analyst consensus of £39.24bn. This has led GM management to revise its 2023 profit guidance by $500m to between $11-13bn. One of the key drivers behind this growth has been the strong sales performance in North America, which offset the weak(er) performance in China. In terms of EVs, GM has stated it is on course to deliver 150k EVs this year.
Ford announced solid Q1 results, with revenue increasing by 14% to $39.25bn however, as expected, the company lost $722 million due to its shift to EVs. However, guidance for 2023, has been maintained, with guidance for adjusted EBIT between $9-$11bn and adjusted free cash flow of about $6bn. However, investors are still not convinced that Ford will be able to avoid the Price War. Investor doubt will not be quelled, as of a couple of days ago, the company slashed its Mustang Mach E prices (2nd time this year).
Tesla has raised prices for its Model Y and 3 by $250-$290 in Canada, China, Japan, and the USA. Although this is the first price hike Tesla has made this year, these models are still significantly cheaper compared to their January prices. This is an interesting move by Mr Musk, as only last week, he stated that the company is willing to sacrifice margin for sales volume. Although shares rose by 2% (on the day), analyst consensus did not change, as some analysts were confounded by this minor price hike.
White House officials have met with Toyota officials, which has resulted in the White House stating that Toyota is now fully committed to producing EVs. This is a cautious progressive statement, as Toyota has fallen behind other OEMs in terms of its EV strategy and output. Although Toyota will stick with its hybrid models, in the short term, it will start ramping up EV production in the long term. This is not a shocking revelation, as last year Toyota announced it would be investing in its North Carolina battery plant, to help boost EV production.
Sweden has announced it will start working on its first EV-charging, E(urope)-20 highway, in 2025. The E-20 will be 21km long and will run between Hallberg and Orebro, in the middle of the country’s three major cities: Stockholm, Gothenburg, and Malmo. However, there is no detail on the method of charging being deployed. Traditional methods such as overhead wires, like a city tram line, or undercarriage-mounted arms that attach to an electrified rail along the roadway, have been used. It will be interesting to see what method Sweden deploys, as it could become the blueprint for other European cities to duplicate.
Porsche has stated that it intends to significantly ramp up production of its Taycan EV. Previously, Taycan EV production has been hampered by supply chain issues, in particular shortages relating to high-voltage heaters, however, these issues seem to be dissipating. This ramp-up in production stems from the demand for the Taycan EV, which has one of the best EV residual value models in the market.
Deals
Joby Aviation, which is developing an all-electric aircraft for commercial passenger service, has announced it has signed a long-term agreement with Toyota Motor to supply key powertrain and actuation components to produce the company’s aircraft. This agreement builds on their long-standing partnership, as they have collaborated on a myriad of projects. Toyota is also Joby’s largest external shareholder, having invested around $400m in the company.
Rydes, a Berlin-based corporate mobility budget platform, has raised €3.5m, in a seed round, led by Assembly Ventures and Rethink Ventures. The company will use this capital to further develop its mobility platform and expand into international markets outside of Germany.