electric cars
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Angling to be the Carfax for EV batteries, Recurrent raises $3.5 million
The Seattle-based startup Recurrent said today it has closed on $3.5 million in financing as it looks to become the Carfax for electric vehicle batteries.
The battery system is arguably the most important part of any electric vehicle and as the market for used electric vehicles expands, independent verification on battery life and range can help car buyers with their purchasing decision, the company said.
Investors include Wireframe Ventures, PSL Ventures, Vulcan Capital, Prelude Ventures, Powerhouse Ventures, Ascend.VC and the American Automobile Association’s (AAA) Washington chapter.
“Used car sales are at least double new car sales every year. With the third anniversary of Tesla’s Model 3 and the rapid introduction of new electric models across all vehicle makers, used EV sales are about to grow substantially,” Paul Straub, managing director of Wireframe Ventures, said in a statement. “The timing is right for a first mover with a strong data and technology advantage to bring confidence and transparency to these transactions.”
The company said it will use the money to invest in continued product development as it refines its third-party condition reports for used electric vehicle shoppers and battery analytics stats for current electric vehicle owners.
Recurrent collects its data from 2,500 volunteer electric vehicle drivers who currently use the Recurrent service for monthly battery reports on their own vehicles
“While there’s clearly a market-driven opportunity here, we’re particularly excited about the potential impact of the Biden administration’s policies on EV adoption,” Emily Kirsch, founder and managing partner of Powerhouse Ventures, said in a statement. “We’ve seen the huge impact that favorable policies are having in the EU and think there’s a lot of upside potential in a similar acceleration in the U.S.”
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Tesla holds on to recent gains with bullish analyst target of $2,300
Wall Street darling Tesla is holding on to its recent gains today on the back of a bullish analyst report, despite some weakness in tech shares.
Tesla has seen its value skyrocket in recent quarters, rising from a 52-week low share price of $211 to $1,548.81 today. That figure, however, is low in the eyes of some. Enter Piper Sandler.
The Piper analyst report, which was first released late Monday, gives Tesla a new price target of $2,322, up from the group’s prior price target of a little over $900 per share. The stock still has room to run, some believe, perhaps explaining some of the mania that related companies have seen in recent weeks, including fellow electric car manufacturers Nikola, Nio and others.
It was enough to prompt a “wow” from Tesla CEO Elon Musk via a tweet Monday evening.
Wow
— Elon Musk (@elonmusk) July 14, 2020
The Piper report cites two key factors for its new Tesla price target: The company’s edge in manufacturing and resulting unit volume, and the possibility that software will allow the company to eventually generate operating margins in the mid-20s.
On the manufacturing front, Piper increased its 2020 delivery estimates based on Tesla’s recent second-quarter numbers. The firm believes Tesla can hit its original 2020 delivery guidance of 500,000 units, which it notes is impressive, given factory closures due to COVID-19.
Piper suggested Tesla can scale rapidly in the coming years. The constraint isn’t customer demand, but instead capacity, the analyst suggested. Of course, building out production capacity is no small and cheap feat. Still, with customer demand wide open, Piper sees big revenue gains moving forward.
The latter argument feels more speculative. A 25% operating margin implies that the automotive company’s gross margins would need to be far higher, a seeming stretch for a company that sells molded metal and plastic in a competitive market.
The basis of Piper’s argument centers on Tesla’s software, specifically its FSD, or “full self-driving” feature, an $8,000 add-on that provides advanced driver assistance over its standard Autopilot system.
Let us provide some quick backstory so that everyone understands: Today, Tesla vehicles come standard with Autopilot, an advanced driver assistance system that offers a combination of adaptive cruise control and lane steering. Tesla once charged for this feature as well, but made it standard in April 2019.
The more robust and higher-functioning version of Autopilot is called full self-driving. FSD includes the parking feature Summon as well as Navigate on Autopilot, an active guidance system that navigates a car from a highway on-ramp to off-ramp, including interchanges and making lane changes. The system now recognizes and responds to traffic lights, as well.
Still, Tesla vehicles are not self-driving cars. The system requires a human driver to remain engaged at all times.
Piper believes the FSD price will continue to rise, driving up margins. The firm predicted the cost of FSD could rise as high as $40,000.
“Thanks to the high-margin nature of the FSD package, we think that by the 2030s, Tesla could conceivably be selling vehicles at cost — or even below cost — while still achieving higher operating margins,” Piper wrote.
There is a very material catch to all of this. Tesla is able to recognize FSD revenue on its balance sheet as it rolls out more features. In other words, Tesla has to keep improving the product to be able to capture that entire line item.
In the first-quarter earnings call, Tesla CFO Zachary Kirkhorn explained that the company takes “roughly half” of the FSD as revenue. The other half of it goes into deferred revenue.
“Our deferred revenue balance is continuing to grow,” he said at the time. “It’s a little bit over $600 million. And so as we release features with time, at the end of every quarter, we take a look at what features have been released, associated value and then we can release that from the deferred revenue into our financials for that quarter. And then cars going forward, once the feature is released, we can recognize that revenue.”
For Tesla shareholders, institutional and retail alike, Piper’s report is welcome. Now Tesla has to live up to raised expectations. The company reports earnings on July 22. TechCrunch will be tuned in.
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The 2020 Chevy Bolt EV now has a 259-mile range thanks to some cell chemistry tinkering
The 2020 Chevy Bolt EV now has 259 miles of range, a 9% increase from previous year models of the electric hatchback, according to the EPA.
To get there, the company focused on cell chemistry, not the battery pack. The GM brand did not add more battery cells or change the battery pack or the way it is integrated into the vehicle structure, a spokesperson confirmed.
Instead, Chevrolet’s battery engineering team made what the company described as “impactful changes to the cell chemistry.” The changes to the cell chemistry allowed the team to improve the energy of the cell electrodes, and ultimately enabled them to squeeze more range out of the battery.
The increase pushes the 2020 Chevy Bolt ahead of the Kia Niro and the standard range plus variant of the Tesla Model 3, with 239 and 240 miles of range, respectively. Other versions of the Model 3, the long-range and performance, have a much longer 310-mile range. It’s also just one mile better than the 258-mile range Hyundai Kona EV. Nissan Leaf Plus, the laggard in the group, can travel 226 miles on a single charge.
That might not seem like much. But in this small, yet growing pool of electric vehicle models, jumping from 238 to 259 miles could help Chevrolet sell more Bolt EVs next year. It could also cannibalize sales this year.
The electric vehicle has never been a top seller for the GM brand, particularly compared to its top-selling SUVs and trucks. It has beat out some of its other Chevy models and sales are high enough for the company to stick with the compact hatchback for now.
GM delivered 23,297 Chevy Bolt EVs in 2017, the first model year of the electric vehicle. But the following year, deliveries fell 22%, to 18,019. Sales have rebounded in the first half of the year.
The 2020 model year, which will be offered in two new exterior colors, is expected to arrive in dealerships later this year. The base price of the electric vehicle is $37,495, which includes destination and freight charges. Tax, title, license and dealer fees are excluded.
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Tesla, GM and Nissan are all part of a new coalition aiming to extend the EV tax credit
Tesla, GM and Nissan are among a group of 15 companies that launched a new coalition aimed at reforming the electric vehicle tax credit.
The group, called EV Drive Coalition, brings together a mix of automakers, industry giant ABB, climate change and energy lobbying organizations and EV infrastructure companies, including ChargePoint.
The coalition, which officially launched Tuesday, wants to pass legislation that would tweak the federal electric vehicle tax credit to “ensure that it works better for more consumers for a longer time frame and spurs increased growth of the U.S. EV market.”
The federal electric vehicle tax credit gives consumers a $7,500 credit when they buy an all-electric vehicle. The incentive has been credited with spurring adoption of EVs. However, once an automaker has sold 200,000 electric vehicles, the credit begins to wind down.
Tesla is already in this position and GM is closing in. Earlier this year, the electric automaker delivered its 200,000th electric vehicle. The achievement activated a countdown for the $7,500 federal tax credit offered to consumers who buy new electric vehicles. Under these rules, Tesla customers must take delivery of their new Model S, Model X or Model 3 by December 31 to get the full credit.
Tesla vehicles delivered between January 1 and June 30, 2019, will get a reduced $3,750 federal tax credit. After that, the credit drops to $1,875 before ending altogether. As of October, GM has sold nearly 197,000 electric vehicles.
The EV Drive Coalition wants to lift the current cap on the number of consumers who can take advantage of the credit through each manufacturer.
“Arbitrary constraints with the federal credit limit consumer options and make it harder for consumers to purchase the cars they want,” Joel Levin, executive director of Plug In America said in a statement. “Lifting the cap would create a more level playing field for all manufacturers, giving consumers the freedom to decide which car they want in a free and fair market. Increased competition spurs more American innovation and technology.”
The coalition says it supports the eventual phase-out of the credit once the EV industry has had additional time to mature and grow.
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Carmakers rushing to defend the EV tax credit in face of proposed cut
The electric vehicle tax credit won’t die without a stirring defense — major automakers are moving their considerable lobbying might behind defending the credit, according to Automotive News, in the face of its proposed elimination in the new tax plan laid out by Republicans last week. Read More
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London puts new hybrid electric black cabs on roads ahead of larger rollout
London is staring up a pilot test of its electric black cabs (via Engadget), otherwise known as the TX5, after first revealing the vehicles back in 2015. The cars have 70 miles of pure EV range on their built-in battery pack, but can also go up to 400 miles using the onboard gas engine to generate the power for the battery and motor. The vehicles meet the conditions for London’s… Read More
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LG to open Europe’s largest EV battery factory in Poland next year
LG is opening Europe’s largest factory for building lithium-ion batteries destined for use in electric cars, the company announced. Its LG Chem division is going to open the doors for the facility in 2019 in Poland near Wroclaw, per Reuters, and the facility will be able to supply as many as 100,000 EV batteries per year beginning next year. Read More
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Tesla made only 260 Model 3 cars in Q3, but is ‘confident’ it can fix bottleneck
Tesla has released its quarterly vehicle production numbers for the third quarter of 2017, which it says was its “all-time best quarter for Model S and Model X deliveries” — but it was not a great quarter for production of the Model 3, of which only 260 were made. Quick-charging battery startup StoreDot gets $60M on $500M valuation led by Daimler
As we continue to see a proliferation of wireless connected devices make their way into the mainstream consumer electronics market, there has been growing attention on a key issue that will be central to making all these devices work: efficient power supplies, and specifically practical battery systems. Today, one of the startups that’s hoping to lead the conversation on how this will… Read More
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Nissan’s new LEAF is making its official world premiere today at 5:30 PM PDT (8:30 PM EDT). That’s when we’ll get the first detailed look at the car, though we’ve seen some teasing images of headlights and tail lights thus far.