In June, the automobile industry witnessed significant developments in the realm of electric vehicles (EVs) and charging infrastructure. The decision by Swedish automaker Volvo to adopt Tesla’s charging design marks an important step towards standardizing EV charging across the sector. This move, in line with similar decisions by Ford, GM, and Rivian, reinforces Tesla’s influence in shaping the future of EV infrastructure.1 Additionally, SAE International aims to establish an industry standard configuration of Tesla’s charging connector, engaging with Tesla, Ford, GM, and other automakers, further solidifying the push towards standardization.2
Furthermore, Ford Motor received a conditional $9.2 billion loan from a US government program to construct three battery factories, a significant step in President Joe Biden’s green technology-focused industrial policy.3 This deal, the biggest government backing for a US automaker since the 2009 financial crisis, aligns with President Biden’s aggressive green technologies initiative and significantly bolsters Ford’s EV production ambitions. The loan will aid in the construction of these battery factories, bringing Ford closer to its expansion goals and providing low-interest financing through taxpayer support.
Overall, the developments in June indicate the increasing collaboration and adoption of innovative technologies in the automobile industry. The partnership between Tesla and other EV manufacturers for charging infrastructure showcases the industry’s recognition of Tesla’s extensive network and standardization efforts. Simultaneously, Ford’s substantial loan and plans for three battery factories highlight the government’s support for American manufacturers in the pursuit of electric mobility. These advancements in EV technology and infrastructure contribute to the overall growth and potential of the automobile innovation ETF, reflecting the industry’s progress and future prospects in the electric vehicle space.
XPeng Inc had an impressive performance in June 2023, with its American Depository Shares (ADS) surging by an astonishing 67.33%. A notable development that contributed to this surge was the company receiving approval to roll out its assisted driving technology in Beijing. This followed the successful introduction of XPeng’s urban scenario driver-assist technology in Shanghai, Shenzhen, and Guangzhou earlier in the year. Significantly, XPeng is currently the only automaker in China that matches Tesla in offering this level of driver-assist technology. 4
Another contributing factor to XPeng’s remarkable rally was the pricing strategy it adopted for its new G6 sport utility vehicle (SUV). The company priced the G6 SUV approximately 20% lower than Tesla’s Model Y in China, which resulted in an over 11% jump in its U.S.-listed shares. This aggressive pricing strategy is expected to bolster XPeng’s competitive position in the Chinese market, which is the largest global market for electric vehicles. 5
Blink Charging Co
In June, the electric vehicle charging infrastructure landscape experienced a major shift with the announcement that automakers such as Volvo, Ford, GM, and Rivian have signed deals with Tesla for utilizing its charging network. This has signaled that Tesla’s charging technology is on the fast track to become the standard for EV charging, as more manufacturers continue to sign on.
In light of these developments, Blink Charging Co’s outlook is under scrutiny. With Tesla likely emerging as a dominant force in the EV charging space, Blink Charging may face increased competition and challenges in expanding its market share. However, the company could still find opportunities in niche markets or by establishing partnerships with automakers or other stakeholders who are yet to commit to Tesla’s charging standards. It will be crucial for Blink Charging to adapt its strategy in response to the industry’s evolution and explore innovative solutions to maintain relevance and competitiveness.6
Portfolio Strategy And Activity
The Evolve Automobile Innovation Index Fund returned 9.26% during the month of May. For the month, XPeng made the largest contribution to the Fund, followed by Tesla and Li Auto. The largest detractors to performance for the month were Fisker, followed by Lucid and Chargepoint.
- Rosevear, J. (2023, June 27). Volvo just became the latest EV maker to move to Tesla’s charging standard. CNBC. https://www.cnbc.com/2023/06/27/volvo-adopts-teslas-ev-charging-standard.html
- Jin, H., & Hunnicutt, T. (2023, June 27). Tesla charging technology put on fast track to become US standard. Reuters. https://www.reuters.com/business/autos-transportation/tesla-charging-technology-put-fast-track-become-us-industry-standard-2023-06-27/
- Rathi, A., Natter, A., & Naughton, K. (2023, June 22). Ford gets $9.2 billion to help us catch up with China’s EV dominance. Bloomberg.com. https://www.bloomberg.com/graphics/2023-ford-ev-battery-plant-funding-biden-green-technology/
- Cheng, E. (2023, June 16). Chinese tesla rival Xpeng gets approval to roll out driver-assist tech in Beijing. CNBC. https://www.cnbc.com/2023/06/14/chinese-ev-brand-xpeng-gets-approval-for-driver-assist-in-beijing.html
- Mehta, C. (2023, June 30). Xpeng shares jump as China EV maker prices SUV below Tesla Model Y. Reuters. https://www.reuters.com/business/autos-transportation/chinese-ev-maker-xpengs-shares-jump-after-pricing-suv-below-tesla-model-y-lifts-2023-06-30/
- Reinicke, C. (2023, June 9). EV charging stocks sink after General Motors says it will use Tesla’s charging network. Yahoo! Finance. https://finance.yahoo.com/news/ev-charging-stocks-sink-general-165617817.html