Why Are Electric Vehicle Companies Worth So Much Money?
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Re: Why Are Electric Vehicle Companies Worth So Much Money?
#2One of the quoted experts opines that while some of the big established car manufacturers will survive, most “are running an uphill race with a parachute behind them while EV-first firms are sledding downhill.”
I think they have a point – existing manufacturers will have to spend a lot of time and energy divesting themselves of all the plants and workforce that will become useless, and/or converting and retooling facilities and retraining staff as they abandon the manufacturing of internal combustion engines and navigate the transition.
All of that necessarily involves looking backwards and takes mental energy away from future-forward product development. Companies that don't have to invest a significant part of their management resources in dealing with legacy have a potential advantage.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#3One of the quoted experts opines that while some of the big established car manufacturers will survive, most “are running an uphill race with a parachute behind them while EV-first firms are sledding downhill.” I think they have a point – existing manufacturers will have to spend a lot of time and energy divesting themselves of all the plants and workforce that will become useless, and/or converting and retooling fac…
I don't think the transition itself is that hard, but they've not really shown any enthusiasm for it so far, so you have to gamble that they even try before they hit a wall and go bust. So it's more a human problem.
Is it possible to be the hero who transforms a company and get rich doing it? Or do you basically have to make a lot of enemies to do the right thing and get no more money than if you just kept your head down while looking for a job at a competitor.
The Ford investing in Rivian thing also reminds me how Yahoo stumbled on for years as a zombie company, basically living off an investment they made in upcoming Chinese tech.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#4Boys love for cars begins at 2 and never ends.
EVs became a meme for revolutionizing the car industry in a way people perceive will be as profound as Karl Benz first car or Ford Model T.
So naturally boys of every age want to be part of this movement and pump their savings (as well as their clients savings) into EV companies, even though manufacturing is a terrible business.
Everything market related it's about meme power of the story and meme power of the product, perception is very much reality. As I said boys love for cars starts at 2 and never ends, unfortunately very few dream about building an artificial heart or defeating parkinson or alzheimers, curating diabetes, solving cancer etc.
It's not just regular people actually. Boys love for toys trascends IQ, Feynman and Von Neumann loved the process of building the most deadly toy know to mankind (nuclear weapons) , but they both died fairly early due to cancer, and they both knew that cancer or cardiovascular disease would have been the thing which would have gotten them (much like any other human), but still they didn't feel compelled to do something about it, they decided to employ their time building toys instead.
Cars, rockets, missiles, planes, bombs , they all fall under the same umbrella of toys.
with cars being #1
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#5Boys love for cars begins at 2 and never ends. EVs became a meme for revolutionizing the car industry in a way people perceive will be as profound as Karl Benz first car or Ford Model T. So naturally boys of every age want to be part of this movement and pump their savings (as well as their clients savings) into EV companies, even though manufacturing is a terrible business. Everything market related it's about meme…
Wow, I had no idea gender stereotypes can explain everything! I thought this power belonged to God Almighty alone.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#6One of the quoted experts opines that while some of the big established car manufacturers will survive, most “are running an uphill race with a parachute behind them while EV-first firms are sledding downhill.” I think they have a point – existing manufacturers will have to spend a lot of time and energy divesting themselves of all the plants and workforce that will become useless, and/or converting and retooling fac…
I think some established will do just fine. Volkswagen and their sub-brands seems to be doing fine here in Europe. They are quite competitive with Teslas more "affordable" options.
Super cheap EVs from Chinas companies will for sure disrupt in the lower end but not everyone will want something like that.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#7One of the quoted experts opines that while some of the big established car manufacturers will survive, most “are running an uphill race with a parachute behind them while EV-first firms are sledding downhill.” I think they have a point – existing manufacturers will have to spend a lot of time and energy divesting themselves of all the plants and workforce that will become useless, and/or converting and retooling fac…
I don't think the transition itself is that hard, but they've not really shown any enthusiasm for it so far, so you have to gamble that they even try before they hit a wall and go bust. So it's more a human problem. Is it possible to be the hero who transforms a company and get rich doing it? Or do you basically have to make a lot of enemies to do the right thing and get no more money than if you just kept your head…
Disclaimer, I work for Toyota, opinions my own.
> Is it possible to be the hero who transforms a company and get rich doing it? Or do you basically have to make a lot of enemies to do the right thing and get no more money than if you just kept your head down while looking for a job at a competitor.
You might get rich transforming the company, but you certainly will make a lot of enemies.
Everyone at these car companies know that as the focus changes to EVs anyone with skills related to the combustion side of things will see a reduction in status and probably pay. Few of those people are anxious to this transition happen during their career and they will not be happy with people who expedite. This is true to a lesser extent with people whose skills are transferable to EV but work in combustion now. To progress a career you generally need to lead new projects and those projects require resources. So to keep skilled people running your combustion business you need to offer them the resources to run these kinds of projects to progress their career even if the money would be better spent on EV development. These people will also fight against money being allocated to EV development rather than their own projects.
EV companies don't have these problems. They have piles of cash and a mandate to get it out the door as fast as possible. Inside the company, everyone's career trajectory is more or less aligned with the company's and so there's no foot dragging.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#8One of the quoted experts opines that while some of the big established car manufacturers will survive, most “are running an uphill race with a parachute behind them while EV-first firms are sledding downhill.” I think they have a point – existing manufacturers will have to spend a lot of time and energy divesting themselves of all the plants and workforce that will become useless, and/or converting and retooling fac…
Kia and Hyundai are already proving that that isn't the case.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#9Boys love for cars begins at 2 and never ends. EVs became a meme for revolutionizing the car industry in a way people perceive will be as profound as Karl Benz first car or Ford Model T. So naturally boys of every age want to be part of this movement and pump their savings (as well as their clients savings) into EV companies, even though manufacturing is a terrible business. Everything market related it's about meme…
> Boys love for cars begins at 2 and never ends.
Just think of all the billions of dudes who lived and died unfulfilled before the invention of the automobile.
Re: Why Are Electric Vehicle Companies Worth So Much Money?
#10One of the quoted experts opines that while some of the big established car manufacturers will survive, most “are running an uphill race with a parachute behind them while EV-first firms are sledding downhill.” I think they have a point – existing manufacturers will have to spend a lot of time and energy divesting themselves of all the plants and workforce that will become useless, and/or converting and retooling fac…
I don't think the transition itself is that hard, but they've not really shown any enthusiasm for it so far, so you have to gamble that they even try before they hit a wall and go bust. So it's more a human problem. Is it possible to be the hero who transforms a company and get rich doing it? Or do you basically have to make a lot of enemies to do the right thing and get no more money than if you just kept your head…
Enthusiasm for actually building EVs has been pretty mixed among the established players
Dieselgate may end up being the best thing that could have happened to Volkswagen as they were all in on extending combustion as far as possible before they got caught cheating. They have made an excellent pivot to BEVs in a pretty short time for such a large company, with MEB designed to produce profitable vehicles not just compliance cars.
Ford is also really embracing electrification, with their two most valuable nameplates already getting EVs in F-150 and Mustang (even if it is a crossover and not a pony car). I'd like to see them have more aggressive plans for ramping up production, but announcing doubling their plans for 2024 recently was a good start.
On the other hand, Toyota looks poised to be dragged kicking and screaming into a BEV, Honda's response has been pretty underwhelming (even if I'd camp at a Honda dealer to get an e if they brought it to north america), and Nissan has completely squandered any early lead they could have built from Leaf.
Everyone else is somewhere in-between, with GM making some interesting moves in Volt and Bolt (terribly confusing names) but lacking a strategic vision, Stellantis seems content to dabble (but that's true of their ICE plans as well), and JLR is planning BEV Defender and Range Rover which done well could be real hits for them.
*edit: totally forgot the Koreans. Kia/Hyundai are in the enthusiastic group, with the new e-gmp platform using 800V batteries and the ionic 5 being the best looking car you can get right now.