- This is a period of great transition.
It's a seismic shift effort.
- Maybe the biggest revolution
since we moved from the horse to the engine.
- [Narrator] If I say electric vehicle today,
many people think of one name,
but many startups want to change that,
Rivian, Lordstown, Fisker, Lucid and Canoo
are all in a race to release new vehicles.
- And it's gonna get to be a pretty crowded space.
- [Narrator] In 2020, 4 out of 5 EVs sold in the US
were Teslas, most of the others were made
by traditional automakers.
As analysts project that the market for EVs will grow 140%
by 2026, new contenders are pitching themselves
as the next big thing.
And they have one thing in common.
- We haven't sold a single car.
- [Narrator] Even though they haven't produced
market ready cars yet,
they've secured millions, sometimes billions of dollars
in funding, but their strategies are very different
and car analysts say not all of them will survive.
- That's probably a little too many EV startups right now.
- There's a whole bunch of other wannabes
out there that exists because of Tesla
who have no concept that this is a technology race.
- [Narrator] So how are these companies
trying to win the great EV race.
Investors have collectively pumped over $10 billion
into these companies,
with Rivian receiving the most, some $8.2 billion
of investment coming from Ford, Amazon, and BlackRock.
We asked to speak to Rivian's CEO,
but the company said they wanted to wait
until they'd started production.
Lucid is second with some $7.4 billion.
- We're now in a very secure financial position
and it's up to management not to screw this up.
- [Narrator] That's Peter Rawlinson, Lucid CEO.
The company recently received more than $2 billion
through Saudi Arabia's Public Investment Fund
and also received $4.6 billion through a merger
with a special purpose acquisition company or SPAC.
SPACs are essentially empty shell companies
set up with the sole purpose
of raising money to merge with another business
and then take that business public.
Fisker too has seen some $1 billion injected
into the company through its SPAC merger
with Apollo Global Management,
Henrik Fisker is Fisker's CEO.
- I think that's great news
for everybody for us and for customers that are looking
for new type of vehicles, new technologies et cetera.
- [Narrator] Lordstown and Canoo
have both received less funding, under $1 billion each.
But those investors are betting on vehicles
targeted at very different customers,
ones that aren't necessarily going to compete
against each other.
Lucid is trying to capture the top end of the market
with its high-end luxury $169,000 Lucid Air Dream Edition.
It's CEO knows a thing or two about sedans.
- I led the design of engineering of Model S,
Tesla's premium it's not true luxury.
We see a huge space in the luxury EV space.
- They might have some more challenges
because you look at those $150,000 vehicles,
and you know, they're pretty established.
- [Narrator] But at the other end of the market is Fisker.
They're making an SUV called the Ocean
which will sell for between 35 and $70,000.
It's made partly with recycled material.
- I think most EV startups start
with a sports car luxury car,
cause they kind of need to prove
that they can make a cool car,
so they feel that this is necessary for them to do.
I don't think we need to prove that.
I truly think the next frontier is affordability,
value for money and getting high volume
into the market of EVs.
- [Narrator] Lordstown, Canoo and Rivian are also targeting
the utility vehicle segment,
by developing pickup trucks and this microbus.
- If you want to have a bit of a chance really,
you kinda need to get into that utility vehicle segment
because that's what consumers are buying.
However, everybody's getting into the utility vehicle
segment because that's what consumers are buying.
- [Narrator] Before selling these vehicles to consumers,
these startups first need to make them.
And some of them say they've been held
up by the Corona virus pandemic and supply chain issues.
- They've missed a lot of their goals.
They've missed a lot of their targets.
They do jump in thinking it's going to be a little bit
easier than it is or that they can move it faster
than they can, and they get into it and realize
that there are just elements you can't rush.
- [Narrator] When Tesla began production of their Model S,
they decided to move almost all parts of manufacturing
in house and Lucid is doing exactly the same.
- Tesla's in a preeminent position
because it has hardcore technology in house.
That is why it's worth what
$650 billion and other companies aren't.
- [Narrator] Rivian and Lordstown meanwhile
have acquired former automotive manufacturing facilities,
but companies like Canoo and Fisker
are instead outsourcing their manufacturing
to other companies.
- Most companies don't get it.
They think doing an EV is you just buy all these parts
off the shelf and inclusion together in a Frankenstein,
and that's a battery EV.
- We are less interested in sort of this ego trip
of having to show everybody else
that you can manufacture a car.
Normally the car industry does is they bring a new car
into an existing factory with very trained personnel
to avoid any hiccups.
And that's essentially what we're doing.
- [Narrator] When these vehicles do eventually
come to market, you'll be hard pressed to buy one
in a traditional car dealership.
Like Tesla, most of these startups
plan on selling direct to the consumer,
but Fisker and Canoo said they would also offer
subscription models much like some other EV companies
do in China.
- You see a lot of people, specifically,
a lot of younger people are really interested in this,
because a lot of young people
really don't wanna go and borrow $50,000 or euros.
- [Narrator] Lordstown on the other hand
is hoping to target fleet operators with its pickup truck.
These vehicles won't only be competing against Tesla.
There's also many startups in countries like China,
and of course, there's the legacy car industry.
- They are also competing against the traditional
automakers, and let me tell you,
they're woken up and they're serious,
and they're not messing around,
and a lot of the things that were considered disruptors
are very rapidly filtering through the industry
for any kind of vehicle you wanna buy,
which means the startups
don't necessarily have that unique proposition.
- [Narrator] General Motors said it's investing $27 billion
in EVs and autonomous driving.
It pans to make 30 electric models by 2025,
and is spending $2.2 billion to convert a factory
in Detroit into its new EV hub.
- This is a change in trajectory,
for society and for General Motors
- [Narrator] Other car makers are actually betting
on the startups succeeding.
Ford, for example has invested some $500 million
into Rivian, but Fisker and Lucid are both betting
that they can replace some
of those automakers within the next decade.
- I think we're gonna say goodbye
to a few of the traditional car companies
that just won't even be there in 10 years.
And then I think you're gonna see some
of those traditional car companies
may be sort of shrink and become smaller.
- That change of the order of the guard
has already commenced,
but there's going to be a continuation
of that over the next decade.
I think that there's gonna be blood on the carpet.
(calm music)