EVs Entered 2023 With A Bang, And Not Just Tesla, Ford And GM

The Chinese EV trio ended 2022 with positive news as Nio Inc NIO and Li Auto Inc LI achieved record December deliveries while XPeng Inc XPEV sales rebounded. Although Warren Buffett-backed BYD Company Limited BYDDF official delivery report is due in the next few days, the auto giant reported higher China EV deliveries for the week that ended on December 25th while Tesla Inc TSLA and Nio saw week-to-week declines. Meanwhile, announced investments in U.S. electric vehicle manufacturing have skyrocketed, marking a historical industrial shift.

The Chinese EV Trio, Li Auto Inc, Xpeng Inc and Nio Inc.

On January 1st, Li Auto reported that December deliveries jumped to 21,233 vehicles, marking a 50% increase from last year, and 41% over the previous record of 15,034 that was achieved in November.

In December, Xpeng deliveries jumped to 11,292, rising 94% from November and going above 10,000 for the first time since July. For the full-year Xpeng sales rose 23% to 120,757 Although fourth quarter deliveries were down from 29,570 in Q3 as they amounted to 22,204, they still exceeded the company’s forecast range of 20,000 to 21,000.

Also in December, Nio delivered 15,815 vehicles which is 51% more compared to a year earlier and almost 12% higher than its previous record of 14,178 that was also achieved in November. Fourth quarter sales rose 60% compared to last year’s comparable quarter Q4 as they amounted to 40,052, exceeding third quarter’s record of31,607. During 2022, deliveries expanded 34% as they amounted to 122,486. Although the Chinese EV luxury startup posted significantly weaker than expected loss for its third quarter in November, it is predicting record deliveries and improved revenues for its third quarter, despite significant disruptions caused by the ongoing covid wave.

US EV battery plants are marking a historical industrial shift

China currently hosts approximately 90% of global production of many key EV components, namely batteries, but that will no longer be the case, as production is shifting to the US. Worksport CEO Steven Rossi recently said in a Bloomberg Interview that the battery technology and automation in North America seems a little further out from China but is looking very exciting for the future in the next few years. Worksport WKSP who is opening their first US Factory for their Solar Truck Bed Cover with battery system for EV pickup trucks currently manufactures truck beds in China, Worksport said they see a real push in China but also a shift where many parties are getting more US focused. The company announced it will visit CES for more strategic discussions related to this shift. As part of research supported by an automaker trade alliance, Atlas Public Policy group counted more than $128 billion of announced investments into EV plants, battery plants and battery recycling.

Many of these new projects are going up in the Southeast, earning the region the nickname the "battery belt”, with the biggest plants in store not from Tesla but from Ford Motor F and General Motors GM. 

In 2022 alone, not just Tesla, General Motors and Ford Motor but also other automakers and their associates announced more than $73 billion in planned projects, which is more than three times the previous record that was set in 2021. And then there are many companies in the automotive accessories industry like Worksport that are also shifting.

Easier said than done

Just because Tesla pioneered these kinds of plants does not mean it is immune to headwinds, like one that is currently facing at its newest Berlin Gigafactory that is the size of around 420 football fields. Besides needing water to boost production from 2,000 vehicles a week to 5,000 in a drought-sticken area, Musk is facing other problems besides water scarcity as local activists are fighting the company to save trees and sand lizards.

Although GM has successfully opened a new battery plant in Ohio the size of 30 football fields, CEO Mary Barra recently had to defend the slow pace of production as training people is taking a little longer than expected.

An electric automotive future still needs to make its case

What’s particularly concerning to some critics is that all those billions of dollars are not only coming from companies, but also from taxpayers, so despite the acceleration of the EV revolution, electric vehicles still have a long way to go to prove that an electric automotive future is truly greener, cleaner and better for the planet and humankind. The question is if companies like Tesla,  Ford and General Motors will lead the future or will their be others to take over.