The electric vehicle (EV) revolution is speeding up, with legacy automakers leaving no stone unturned to establish a strong foothold in this domain and setting ambitious targets to electrify their fleet. Last week, U.S. auto giant
Ford
F
provided updates to rev up its EV game in Europe. It has chosen the Valencia plant in Spain for its next-gen EV architecture. The architecture is a vital step for Ford in Europe as it will not only carve out a thriving business but also reduce emissions in line with the Paris Climate Agreement. Germany-based automaker
BMW AG
BAMXF
announced its bold EV plans in China and Austria. With an investment of $2.24 billion, the company’s China plant will bolster EV capacity. BMW will also invest $1 billion in electric powertrain in Austria.
Meanwhile, EV king
Tesla
TSLA
confirmed its plans to cut salaried jobs while raising hourly staffing. U.S. legacy automaker
General Motors
GM
also made news as its tech startup BrightDrop delivered the first 150 e-delivery vans to FedEx. Japan’s
Toyota
TM
also made it to the headlines following its collaboration with Redwood for EV battery recycling.
Tesla, General Motors, Ford, BMW and Toyota carry a Zacks Rank 3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Last Week’s Top Stories
1.
Ford
selected its plant in Valencia, Spain, to assemble vehicles based on next-generation EV architecture. The Valencia plant has the potential to produce path-breaking electric and connected vehicles, beginning later this decade, once it clears customary approvals. The business promises to be a profitable one and will secure high-value employment.The company’s promising plans in Europe, part of its Ford + plan, cover an exciting lineup of EVs, including an electric version of the popular Ford Puma. It also intends to spearhead its influence in the commercial domain with electric Ford Pro vehicles and connected services. Ford aims to sell 600,000 EVs in the country annually in 2026.
Ford restated that Germany will be the headquarters of its European Model e-business and the site of its first domestic European EV production. The advanced Cologne Electrification Centre will begin production in late 2023. Ford’s ambitious investments in Germany look to steer the nation to new heights in technology and engineering. It is also moving ahead with its $2 billion investment plan of converting its Cologne, Germany, operations into producing electric passenger vehicles, starting in 2023.
2.
BMW
announced that it has formally started production at the new Lydia plant in China, with an investment of 15 billion yuan ($2.24 billion), to accelerate EV capacity. The Lydia plant is designed to produce battery-powered electric cars on its flexible manufacturing lines, tailor-fit for the existing market demand. The first model to roll off Lydia’s production lines is i3, a pure electric mid-sized sports sedan.
In another noteworthy development in its EV initiatives, BMW plans to spend nearly €1 billion ($1.05 billion) through 2030 to modify its factory in Steyr, Austria, so that it becomes a leading production and development site for the company’s next-generation electric powertrains.As pre-requisites for the production, BMW will build a new two-story production hall that will house two assembly lines for electric powertrains and transmissions. The building will expand the logistics areas. All upgrades will expand the total production area by about 60,000 square meters and the cost will reach nearly €710 million ($747 million) by 2030. The premium electric powertrains will be an entirely on-site development, accounting for an additional €230 million ($242 million) investment.
3.
Tesla
confirmed that it will be reducing its salaried workforce by 10% in the next three months. Its staff is split at about 66% hourly and 33% salaried workers. The net reduction will amount to 3.5% as the company looks to add more hourly workers. Tesla presently has about 100,000 employees globally. The layoffs have affected human resources representatives and software engineers. Many of them have been caught off-guard as they were released immediately.
In another development, Tesla announced that it will partly suspend operations at its Shanghai Gigafactory for a few weeks to bolster the production capacity to more than 21,000 EVs per week. The upgrades will be carried out in stages. The Model Y line will be upgraded first, with the company holding back most production of the all-electric crossover during the first two weeks of July. The Model 3 upgrades are expected to take place for 20 days beginning Jul 18. Post upgrade, the production capacity of Model Y and X will be boosted to 14,000 and 7,700 units a week, respectively.
4.
General Motors
announced that its technology startup, BrightDrop, has delivered its first 150 electric delivery vehicles to FedEx throughout Southern California, out of a total order of 2,500 units. The first five vans had already been delivered in December 2021. All the 150 vehicles delivered comprise the larger Zevo 600 model, formerly known as the EV600. It is designed for last-mile deliveries and is powered by GM’s Ultium Platform.
This marks an important milestone for FedEx as it plans to transform its entire parcel pickup and delivery (PUD) fleet to all-electric and achieve zero-tailpipe emissions by 2040. Also, this is part of a larger agreement, according to which FedEx will add a total of 2,500 BrightDrop Zevo 600 electric delivery vans across its operations over the next few years.
5.
Toyota
teamed up with Redwood Materials for electric vehicle battery recycling. In sync with their united efforts toward sustainable carbon-neutral operations, the two companies will explore end-of-life battery solutions for Toyota’s battery ecosystem. Initially, TM and Redwood intend to focus on the collection, testing and recycling of Toyota’s hybrid EV batteries. They would then expand their collaboration into other areas like battery health screening and data management, remanufacturing and battery material supply throughout North America.
Amid cut-throat competition — with more and more legacy automakers committing to electrified lineups — Toyota has bolstered its electrification efforts lately. Notably, Toyota expects to sell 8 million EVs worldwide by 2030 and spend $70 billion on their development. It targets to sell 8 million partially or fully electrified vehicles by 2030. About 2 million will be battery-powered cars and fuel-cell vehicles, while the other 6 million will be gasoline-electric hybrids or plug-in hybrids.
Price Performance
The following table shows the price movement of some of the major EV players over the last week and six-month period.
Image Source: Zacks Investment Research
What’s Next in the Space?
Stay tuned for announcements of upcoming EV models and any important updates from the red-hot industry.
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