Overview
Ford, in its Integrated Sustainability and Financial Report, has stated it is on track to hit its target of manufacturing 600,000 EVs by the end of the year. The company has also reaffirmed its stance, it will hit 2 million EVs annually from 2026 onwards. This will be due to investing over $50bn in its manufacturing and battery facilities.
Tesla posted solid Q1 2023 vehicle delivery figures, producing 440,808 and delivering 422,875 vehicles, which is a 4% increase from the last quarter and 36% compared to Q1 2022. However, this figure is slightly misleading, as we must factor in the recent price cuts. Analyst consensus had pencilled in delivering 432,000 vehicles for this quarter. This indicates that increasing competition and a bleak(er) macro-outlook has hit Tesla slightly. This makes Mr Musk’s bold target of delivering 2 million vehicles in 2023, a challenging prospect. However, as historical performance has dictated, Mr Musk has a track record of defying the odds.
BYD posted strong Q1 2023 figures, selling 264,647 vehicles, which is an 87% increase YoY. Even more impressive was that in March alone, 102,670 EVs were sold. March is typically a slow(er) month however BYD posted very strong figures illustrating its brand strength in China and foreign markets. These figures indicate that it is gaining ground on Tesla and their EV market share. BYD’s strong output indicates that the EV market is stronger than the current media conjecture.
Rivian published robust Q1 figures of producing 9,395 vehicles and delivering 7,946 vehicles during this period. This slightly beat analyst estimates of producing 8,752 vehicles and delivering 7,752 vehicles. Rivian has stated that it is on course to deliver on the 50,000 annual production guidance. In Q1, Rivian has been hit with supply chain issues causing a scheduled stop in the company's commercial production line. The company is in the process of moving its manufacturing engineering team, currently spread across the country, to its factory in California. These operational changes will be felt in H2 2023. These changes will play a crucial factor in hitting the 50,000 target.
SMMT published data for new-car registrations in March, which showed an 18.2% increase compared to March 2022. This is the 8th consecutive month the UK market has grown. March was the best month ever for full-electric car sales, growing by 18.6% This resulted in a record monthly high of 46,626 BEVs, representing a market share of 16.2%. Whilst diesel sales fell by 19.9%, for a 3.8% market share. The strong performance of BEVs indicates increased consumer choice and improved availability.
A consortium of Oxfordshire councils has launched an EV car-sharing scheme as part of a new 12-month trial. There will be 14 new EVs available for people to hire hourly or daily, using a pay-per-use car-sharing model. The council(s) estimates each vehicle could take, on average, 20 individually owned cars off the road. The consortium has partnered with Co Wheels, Enterprise Car Club and Thame EV Car Hire for the 12-month pilot scheme.
Group14 Technologies and Sila Nanotechnologies have stated that a new generation of EV batteries powered by silicon-based electrodes is forecasted to go into production next year. These batteries aim to achieve a longer driving range and a faster charging rate. Apart from the advantageous specifications, silicon is an element that there is an abundance of, which is being developed as a supplement or replacement for graphite in battery anodes.
CATL has announced it is working on battery packs that would use lithium-ion and sodium-ion cells. Sodium is more abundant and offers potential safety benefits over lithium. Currently, lithium dominates EV batteries. Battery experts are reconsidering the potential for sodium ion chemistries to play a role in powering future EVs. Sodium-ion batteries can leverage the same manufacturing processes as the lithium-ion industry, meaning the former could benefit from advances that the latter had made over the last decade.
Deals
Cabify, a Spanish ride-hailing app, has raised $110m, from investors such as Orilla Asset Management and AXIS, through Fond-ICO Next Tech. This capital will be used by Cabify to further accelerate its growth in Latin America and Spain. The company has a presence in more than 40 cities in Argentina, Chile, Colombia, Mexico, Peru, Uruguay, and Spain.
Venti Technologies, an autonomous vehicle start-up, has raised $28.8m in a Series A round. This capital will be used to continue building its software, to partner with third parties for hardware, and to secure more deals.
Winnebago Industries, an outdoor lifestyle product manufacturer, has announced that it has reached a definitive agreement to acquire Lithionics Battery. Lithionics Battery is a lithium-ion battery solutions provider, to recreational equipment and speciality vehicle markets.
Spotlight: Powering Up Britain
Energy secretary Grant Shapps has unveiled the UK government’s net zero and energy security strategy, in a report called Powering Up Britain. This report was highly anticipated, as it was touted as a response to America’s recent progressive policies such as the Inflation Reduction Act. However, general industry consensus has been underwhelming and even critical.
The key aspects of the strategy are:
- Jumpstarting the hydrogen economy: 15 hydrogen projects have progressed to the next application round for funding under the £240m Net Zero Hydrogen Fund.
- With a further shortlist of 20 projects entering the due diligence round for the first electrolytic hydrogen allocation round.
- The report also announced it will open two further hydrogen funding rounds in 2023.
- Reducing reliance on fossil fuels to heat buildings: The UK government has a goal to phase out all new (and replacement) natural gas boilers by 2035.
- The government has announced a £30 million Heat Pump Investment Accelerator. The aim of the accelerator is to stimulate domestic heat pump manufacturing at scale.
- Another objective is to make it as cheap to buy and run a heat pump as a gas boiler, by extending the Boiler Upgrade Scheme by three years.
- This scheme offers £5,000 grants to households to install heat pumps.
- Committing to Carbon Capture, Usage and Storage (CCUS): The government has announced eight projects to progress to negotiations to form the first two CCUS clusters, in the Northeast and Northwest.
- The government is also launching a process to enable the expansion of Track-1 clusters later this year. It is also launching the process of confirming the next clusters for deployment in Track-2.
These policies are a small step forward however, their implementation of them is vague. The government also have not really developed new policies, they are recycled and repackaged policies of the past. We agree with industry experts, that the government needs to communicate and consult with the Energy industry more, to truly understand what funding and framework of policies are needed to impact energy sub-sectors, in order to hit the Paris Agreement target(s).