Electric Vehicle Start-ups
Abhishek writes in:
“… electric vehicle startups require large amounts of capital to go into production. The continuous need for large capital infusions makes partnerships with established companies with large balance sheets essential. I think some of these ventures would eventually be absorbed by the Hondas and Toyotas of the world.”
Good points, Abhishek — thanks for writing in. And yes, you’re right that a great deal of consolidation is in the cards. But I guess I always thought there was a place for the start-up EV manufacturer — but so far there has been essentially nothing but carnage.
I’m wondering what’s behind all this failure. I’m reminded of the numerous “Plug In” conferences I’ve attended, expecting a feeling of exuberance in the air — but instead sensing a kind of dread. And that dread is simply what you’re talking about: the fear that the big guys will do this at their leisure — and then crush the start-ups like so many grapes.
Having said this, we need to acknowledge that starting a car business from scratch is a lofty endeavor. I’m amazed to see that CODA just raised $58 million in series-C money. Those are some bold investors, I can tell you that.
If I were giving advice, I’d suggest aiming for a niche. Compete in a space that is well-defined – probably one that is too small to receive the attention of the large OEMs.
I wish too that it was possible for start-ups to make it big in the automobile space but the entry barriers are too high.That’s why you see the Fords,Toyotas continue to dominate the industry for such a long time.Small Indian EV maker Reva which has been in the business since 2001 got bought out by a big Indian company Mahindra.You can read more here http://bit.ly/dC7He6