The ‘rookie’ series is immersed in ‘production hell’, the illusion can be as successful as Tesla
Located in the town of Bicester, about 15 miles from Oxford, is a factory that is “on the front lines” of the electric vehicle (EV) revolution in the UK. Under the vast warehouse ceiling, dozens of giant black robotic arms were already sitting beside empty assembly lines. They are waiting to start mass production of electric trucks for Arrival – a British EV startup.
By the fall, the pristine factory had begun producing electric trucks for UPS, an American freight company. However, the task began to fall behind schedule. Another “brother” factory in the US cannot produce at this time and so the UK factory will have to bear all of this year’s output. Arrivel is currently expected to produce only 600 units this year, less than half of what experts predict for 2021.
It is worth mentioning, Arrival is not the only company experiencing this problem. A host of electric vehicle manufacturers – some of which are opening factories for the first time, and many with even exaggerated market values - are facing their biggest challenge: Car production. From China’s Nio to Rivian – most companies in the electric vehicle world are struggling during this period.
The industry’s shift to electric vehicles is always expected to lead to a flood of new entrants because the barriers to entry are often lower. However, the combination of Tesla’s exaggerated valuation and investor scrutiny sent electric vehicle businesses fleeing a massive wave of IPOs.
As a result, companies that have never been profitable or, in many cases, have never had revenue stand in the middle of the vast mass market and are overwhelmed by the halo of the world investment community. Canoo, Lucid, Nikola, Lordstown, Fisker, Arrival and Rivian are all IPOs before they can deliver any finished cars to customers.
Still, investors kept jumping in. At least 18 electric car manufacturers have listed in the past year through the company SPAC. The next 12 months will be critical to proving whether any EV companies are worth the investment of venture capitalists. “These are all stocks on the sample,” said Dan Levy, an analyst. Moreover, in addition to the pressure of fast production, many companies including Lordstown, Canoo, Lucid and Nikola have had to disclose that they face or have faced legal investigations.
There’s an indisputable fact in the auto industry: Car production is inherently difficult. The lesson of Tesla is the most obvious example. They spent two decades grappling with the goal of mass production, facing problems ranging from how to choose the right components to how to assemble them without errors.
In the darkest times, Tesla has had to go through what Elon Musk calls “production hell”: Supply chains are late or unresponsive, cars that want to get off the production line require workers to work overtime. At one point, the company even sent cars without seats and asked the dealer to assemble them in the showroom.
Tesla emerged from the other side of the trillion-dollar electric vehicle industry. Investors are now looking for a company that can repeat their success.
“Everybody on Wall Street is making a decision that they’re going to invest in electric cars, and they’re looking for one, two, or three companies that could make the next big thing. There’s a belief that someone or A few companies can capture a large share of the electric vehicle market,” said Henrik Fissker, an electric vehicle manufacturer.
“Investors don’t know who can do that right now so they bet on multiple matches and wait and see who emerges.”
However, the initial enthusiasm is showing signs of easing. Shares of the company that was once valued more than Volkswagen, Rivian, have lost more than half of their value in just six months.
While the company and others like Lucid are still worth billions of dollars and their stock prices are still higher than a few veteran manufacturers like Renault and Mazda, the gloom has set in.
“It’s very easy to see what Tesla did and say this is the formula: You just have to have Tesla’s DNA, Tesla’s strength, and you will succeed. However, Tesla is a special case. If only because If Tesla did it, there’s no guarantee that others can do it too.”
Tesla’s path to the limelight has also been fraught with delays, with its patient shareholders. The new wave of companies will of course no longer enjoy that patience, especially since the electric vehicle market is no longer the open field that Tesla could dominate once the automakers become successful. public “also started betting on EVs”.
“New electric car companies won’t be on the runway for 10 years like the industry has given Tesla,” said Philippe Houchois, a London-based analyst.
The new entrants were already starting to feel the pressure. Rivian was initially seen as a threat to truck manufacturers in the US. Recently, however, it has faced backlash after increasing the prices of its models by up to and being forced to halve its production target to 25,000 vehicles this year. The reason given by the company is due to global supply chain problems.
Lucid, run by former Tesla engineer Peter Rawlinson, pushed back production last year and said it wanted to get its first car “absolutely right”. Mainstream automakers from Volvo to Volkswagen have also slashed their 2022 output forecasts, hit by global chip shortages and disruptions from the Russia-Ukraine conflict.
“We all know what Elon Musk’s production hell looks like and don’t want to go there,” said Karl-Thomas Neumann, a former VW and GM executive. “Startups all want to explore production technology, but how to do it is still a question mark.”
at Blogtuan.info – Source: genk.vn – Read the original article here
