The Collapse of the EV SPACs: Another One Goes Bankrupt, Others on the Verge   

The SPAC boom will surely go down in history as one of the biggest stock-market heists ever, made possible by Consensual Hallucination. 

By Wolf Richter for WOLF STREET.

EV maker Proterra, which makes mostly a few electric buses a year – when giant competitors make many thousands – filed for Chapter 11 bankruptcy today, 25 months after having gone public via merger with a SPAC. It once had a market cap of nearly $4 billion.

It was by no means a record in terms of how long it took for an EV SPAC to go bankrupt; that record is held by Electric Last Mile Solutions, which took only 12 months to get it over with. EV maker Lordstown made the trip from SPAC merger to bankruptcy in a little over two-and-a-half years. The shares of other EV SPACS have totally collapsed, and most of them are headed for bankruptcy.

Proterra’s shares, or rather the SPAC’s shares before the merger, spiked after the merger was announced in January 2021 from around $10 to $31.06 and then began to collapse. Five days ago it was still at $2. Today, it plunged to 17 cents, down by 99.4% from the peak.

We’ll get to a bunch more charts like this in moment, with lots of scandals around them. The SPAC boom in 2020 and 2021 will surely go down in history as one of the biggest stock market heists ever. It has left behind a trail of investigations and settlements and scandals. Short sellers had a big party.

But it left no victims behind, just a bunch of eager players that tried to weasel out some money from other eager players, and some succeeded, and others got cleaned out. It was the era of consensual hallucination, when the Fed’s free money reigned. These creatures have long been populating my pantheon of Imploded Stocks.

Tesla is not part of this list. It is kicking the ICE vehicle makers in the nuts and is taking massive share from their ICE vehicles! And it’s very profitable, after a decade of losing tons of money. Tesla put EVs on the map. And legacy automakers gave it a decade to build its position, and now they can’t get their ducks lined up in a row to even defend their turf.

Rivian is not part of this list either because it went public via classic IPO. It’s actually ramping up mass-production and is on track to make 50,000 trucks in 2023. It raised its production target today to 52,000. But it’s losing so much money and burning so much cash ramping up production that it’s breath-taking. Today, it reported a quarterly loss of $1.2 billion. Its shares got crushed, down 86% from the peak just after the IPO. So it gets its own place right here:

Our EV SPAC heroes.

Lordstown and Electric Last Mile, since they filed for bankruptcy, no longer qualify for a chart here. Electric Last Mile has been sold in pieces, and Lordstown’s shares are still ping-ponged around over the counter, but forget it.

Nikola [NKLA], at $2.20 today, has collapsed by 97% from its high in June 2020 when the merger with a SPAC was approved. The outfit embodies the scandalous nature of these things that went to such heights during the era of consensual hallucination and then thankfully collapsed.

Canoo [GOEV], SPAC merger completed in December 2020. $0.56 now. From peak: -97.5%.

Fisker [FSR], SPAC merger October 2020, preceded by Fisker Automotive which made the Fisker Karma. Now $5.93. From peak: -81%.

Lucid Motors [LCID], SPAC merger announced in February 2021. Now $7.19. From peak: -89%.

Workhorse [WKHS], Now $1.10. From peak: 97%.

Faraday Future [FFIE] SPAC merger in July 22, 2021. Tuesday special, $0.27. From peak -99%.

Lion Electric [LEV], a Canadian company, SPAC merger November 2020, now $2.32, from peak: -93%

Polestar [PSNY] SPAC merger completed in November, 2022; started trading in June 2022, at $11, giving it a market cap of $23 billion. Now at $4.25, down 74% from the peak. The company is majority owned by Chinese giant Geely, which had bought Volvo, which had bought a startup that became Polestar. The vehicles are made in China, and they’re ramping up production. Given its big corporate backing, and part-ownership, this one might be among the survivors:


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  146 comments for “The Collapse of the EV SPACs: Another One Goes Bankrupt, Others on the Verge   

  1. Dan says:

    Who could possibly have foreseen that SPACs (a vehicle whose sole purpose is to avoid transparency) would turn out to be a scam?

    • Beg4mercy says:

      But, the allure of getting rich quick is so tangible and exciting and easy — perfect model for impatient, stupid morons. I didn’t bother to investigate how the trump scam is going, but my gut tells me it’s up YUGE.

    • joedidee says:

      love some names

  2. rodolfo says:

    As fraudulent as this SPAC thing is its good to keep in mind that the same crap happened in the dotcom bust but through IPOSs.

    Basic idea is do your homework when investing.
    And where has Gensler been protecting investors during this?

    • old school says:

      Sometimes the gamblers get lost in the weeds. SP500 with earnings yield of 4% and standard deviation around 17% vs m/m with yield of 5.2% and standard deviation zero.

      History teaches us that there is a reason yield on stocks is normally is a lot higher than money market yield.

      • Joanna v. says:

        Maybe that old normality was abnormal. Long term real GDP growth is around 1.75% in the US. If the debt keeps spiraling, real Treasury yields could stay above that, until the inevitable default. Stock market (aggregate) should never yield more than real economic growth, the rest is speculation and money printing.

        • Cas127 says:

          “Stock market (aggregate) should never yield more than real economic growth, the rest is speculation and money printing.”

          This is a very good point, far too infrequently made.

          (I think some quibbling about reasonable annual equity returns can be made at the margins, but Joanna’s statement is a helluva lot closer to reasonable reality than the fairly insane annual returns that equity has seen in a slow, slow (ssssllloooowww) growing US/world (in GDP terms).

          In fact, a multi-year/decade analysis comparing various index equity returns vs. various flavors of GDP (or other growth metrics) is exactly the sorta thing Wolf excels at (and that I occasionally attempt to foist upon him…)

          Bottom line, equity investors having been smoking crack for a number of years (at least since end of 2016).

    • Island Teal says:

      Gary Gensler (Cueball) doing what he always did back in the days at the CTFC… Nothing 🤡💸🤡💸🎉🎉

    • Bobber says:

      Out of control speculators have a right to buy lottery tickets. The SEC should not limit these rights, nor support them.

      Who’s to say what a stupid investment is?

      • rojogrande says:

        I agree with you if there is complete disclosure regarding an investment. Then let people lose, I mean invest, their money since they had access to all relevant information. The SEC doesn’t protect people from stupid investments, I’ve made plenty of stupid investments.

        However, it has an important role to play if deterring fraud in the market. I don’t think you’re advocating the legalization of fraud, but that’s the end result of what you suggest if you don’t want the SEC to investigate some of these SPAC promoters.

      • Cas127 says:

        “Who’s to say what a stupid investment is?”

        Becomes problematic when the pitchfork fools demand taxpayer/dollar holder reimbursement for their laziness/stupidity.

        That is a horror movie we’ve seen before (again and again).

        There is a reasonable role for regulators in public disclosure/education/publicity (whereas the G too frequently obsesses over the trees while ignoring the politically powerful forest).

        The G isn’t shy about stomping upon certain sandcastles…just dubiously selective.

    • Happy1 says:

      This wasn’t a job for Gensler. You can’t protect stupid. SPAC festival happened in the context of outrageously suppressed interest rates and “TINA” environment with yield seeking, this is a creation of Fed policy, as is almost every market distortion since about 2002.

  3. Jos Oskam says:

    “Extraordinary Popular Delusions and the Madness of Crowds” is an early study of crowd psychology by Scottish journalist Charles Mackay, first published in 1841(!). I have read this book and it is impressive, not in the least because nothing in human behavior seems to have fundamentally changed since then.

    I think it is more than time that somebody start writing a sequel. This whole SPAC fiasco would fit in wonderfully. And there are lots more in Wolfstreet’s history.

    Maybe if Wolf has some time on his hands (just kidding) he could do such a book. He certainly has more than enough material.

    • HowNow says:

      There are sooo many examples of financial hyper-speculation right now that the only thing yet to be “invested in” is real estate on distant galaxies.

      • LIFO says:


        I’m looking for one million people to invest in my nebula. Investment returns are guaranteed to flow at the speed of light.

      • BobE says:

        They skipped the Universe and went to the Metaverse.

        Crazy times! Nothing has changed as far as human nature and speculation. Paraphrasing Charles McKay 1841

        • HowNow says:

          “I can calculate the motions of the heavenly bodies, but not the madness of people.”
          – Sir Isaac Newton

    • longstreet says:

      Black Tulips are the best

    • John H. says:

      J Oskam-

      Try this:

      “There can be few fields of human endeavor in which history counts for so little as in the world of finance. Past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have the insight to appreciate the incredible wonders of the present.”
      from John K. Galbrith’s A Short History of Financial Euphoria

      Galbraith’s economic theories are messed up, but his observational powers and writing are top notch. This was written in 1993. Schumpeter, Minsky and Kindleberger are instructive as well…

    • Ross says:

      More recent book The Psychology of Money makes the argument the stock market is not one single homogenous entity, but a collection of different investors who all have different reasons, goals, and incentives. If you follow the lead of an investor who has vastly different reasons and goals from you, the same investment could be a win for them yet a disaster for you. The galaxy of these reasons and incentives is what makes the market impossible to predict. The author quotes Richard Feynman: “Imagine how much more difficult physics would be if electrons had feelings.”

      • fullbellyemptymind says:

        I would add Simmel’s “Philosophy of Money” as well. It’s not recent (1890s or so), but his take on a theory of value is worth digging through the weeds to get at.

        Fair warning – Simmel’s work was foundational to the Frankfurt School of social(ist) theory. This may be triggering to some readers.

      • 91B20 1stCav (AUS) says:

        …but has anyone attempted to pen: ‘The Psychopathy of Money’ ?

        may we all find a better day.

  4. Xaver says:

    Regarding opacity, Tesla is the king. It is “very profitable” you say. The profit margins are falling fast right now. In China, sales seem to be pretty bad.

    The SPACs were not easy to short. Their moves were extreme and manipulated and shares hard to borrow when you wanted them.

    SPACs were a sign of a super bubble. Because of its enormity markets will probably take years to deflate. At least it feels like that if you look at the indices.

    • Michael says:

      We’re the FANG s at some stage not SPAC as well and many others esp. Tesla.
      Amazon did not make money for a long time as well and was written off by many analysts ( that is why I never bought it).

      • Arnold says:

        Apple had over a $100 million in revenue when it went public in 1980.

      • CharlesTheHammer says:

        Amazon not being profitable for years is the problem!

        You see we are the next AMZN we are not profitable either, but man, look how fast we are growing!

    • Herb_Snout says:

      The ghost of Bernie is toasting the street and SEC … parking lots in China have stock in them but not what you think … unsold EVs. The fleecing of zombie investors by proxy. When “money has as much value as a lottery ticket” risk becomes hope.

      • Shiloh1 says:

        Collum twit just posted a shirt video on that, new EVs in China rotting in fields. Chainsaw Al accounting.

    • Wolf Richter says:

      Tesla’s profit margins are falling from the highest of any major automakers to the range of the better major automakers. In terms of net profit: In Q2, it made $2.7 billion (GAAP). Higher than GM at $2.6 billion (GAAP), and higher than Ford at $1.9 billion.

      GM’s revenues were about twice Tesla’s revenues.

      Sales in China are not “pretty bad,” they’re soaring in a market where EV sales are soaring. But Tesla exports from China, and when it loads up a vehicle carrier with units headed to other countries, those vehicles are not available for delivery in China. That month, deliveries drop from the prior month, when the entire production was sold in China. This always creates the dumbest clickbait headlines on earth.

      • Xaver says:

        As far as I know Tesla is losing market share to BYD. China is the biggest market for EVs.

        • Wolf Richter says:

          BYD’s EV registrations are typically cited including its plug-in hybrids (PHEVs) as “electrified vehicles,” which is very confusing because hybrids are still ICE vehicles. So it’s really hard to sort this out, and you have to look at the details.

          For example, I just looked it up:

          BYD’s top-selling “electrified” model was the Qin Plus, with 42,887 registrations in June, EV and PHEV models combined, and that’s the figure that is cited in the rankings in China. But the pure battery-electric (BEV) version sold only 10,816 units.

          Tesla sells only pure BEVs, and its Model Y got 31,054 registrations, nearly three times the registrations of BYD’s top-selling BEV.

          EVs and hybrids should never be counted together. Hybrids should be counted with ICE vehicles.

        • rick m says:

          Don’t know why ICE’s can’t be ICE’s, hybrids can’t be hybrids, and EVs can’t be EVs. They are different. And have utility based on infrastructure. The EV infrastructure isn’t everywhere yet. Gas stations are. Patience is a virtue.

      • Rob B. says:

        Tesla is indeed making a lot of money, and more profitable than their competitors, but that doesn’t make the stock valuation any less insane.

        Market Cap:
        GM $50B
        F $51B
        TSLA $781B
        ^ One of these things is not like the other, lol

        • Wolf Richter says:

          I agree. The share price, though it has come down a lot, is totally nuts.

          I had too much sleep and wanted to lose some, I would short the stock. But obviously, given the violent up-moves, that’s a really bad idea.

        • Massbytes says:

          Yes one of them if the world leader in EVs with the Model Y outselling all other vehicles and the other two may not survive.

      • intosh says:

        Clickbait indeed. It’s amazing how people here are generally suspicious of mainstream news about the US economy and businesses but they gladly swallow hook, line and sinker when it comes “news” about China.

        Latest estimates say that China accounts for 60% of the global EV sales. Vehicles that are actually left unsold are ICE vehicles from “legacy” US, European and Japanese automakers. Some even announced leaving the Chinese market because they don’t EV products to sell. VW, Ford, Renault, Toyota, etc. have all recently announced investments, contracts and joint-ventures with Chinese companies for EV and related technologies. VW/Audi will build their EVs on various Chinese EV platforms.

        Soon, EV manufacturing in China will be like advanced microprocessor manufacturing in Taiwan but times a 100.

    • Duke says:

      And how many ICE automakers are only around because of government bailouts?

      Just saw an article where proposed Colorado state EV incentives could stack up to over $26k per vehicle! I guess Coloradoans are literary sick of living in a smog bowl!

      Also, we can never know how profitable Tesla would be without the subsidies. They were still selling well when they stopped qualifying for Federal tax credit for awhile.

      Maybe people. Just want to buy the safest and most efficient vehicle ever built!

    • Nate says:

      I just don’t think we need to overthink this. The byd dolphin sells for around 15k USD in china, will likely pass crash tests, and tariffs will eventually go away.

      Meanwhile, most of the majors seem to be focused on chasing the high end and big auto markets because the margins are better. So china comes in, owns the low end, build a rep, and moves up the value chain. Like the japanese, Koreans, etc.

      No more room for Tesla wanna bees. They can’t hit scale in time.

  5. old school says:

    Someone taking half a day to read Ben Graham’s book could save themselves from these disasters. Three main rules:

    1. Make sure there is no way company can go bankrupt.
    2. Make sure company has history of making money.
    3. Don’t pay too high of a PE.

    • Anthony A. says:

      I agree with no’s 2 and 3, but no. 1 is difficult to forecast reliability. With companies like GE and Boeing, a new CEO can upset their business and the stock may crater. Maybe not go totally under, but set themselves up for bad times going forward. This is especially true in the ERA of stock buybacks.

      Look what happened to GM several years ago as an example.

      • SoCalBeachDude says:

        Look at what’s happening to GM and Ford right now!

      • old school says:

        I think in Graham’s book he gave some specific guidelines about the balance sheet. The world is different with fiat currencies, but you can still use his principles of high levels of interest coverage to get it right most of the time.

      • John H. says:


        Good point regarding #1.

        Another example: Union Carbide, a true black swan event if ever there was one.

        Which leads to a proposed contender for an investment rule #4:
        Portfolio Diversification

    • Ross says:

      I have invested in stocks using analysis similar to Graham. At the time of purchase, I wrote down the reasons I thought it was a good investment, and the reasons I thought the investment might not work out. In over 30 years, through good and bad investments, and even though I’ve done pretty well for myself, my reasons in hindsight have been wrong Every Single Time. Which means a large portion of my gains is sheer dumb luck. And it takes only one or two superstars to make up for a lot of mediocre or bad selections (looking at you, Yahoo).

      I no longer buy individual stocks for the primary purpose of investment return. I use index funds for that. I buy stocks so I can feel I am participating in the business. I have JOBY stock for example. I bought a SPAC which eventually became AppHarvest because I believe the trend of greenhouse farming has great potential. AppHarvest filed for bankruptcy last week. I knew it was a high risk, which is why the investment was small. On the flip side, my iRobot stock is still doing well.

  6. Varughese says:

    You need to analyze the EV component supplier and see how much of a scam they are. Because if supply chain collapses, the entire industry will go down

  7. Gabe says:

    FYI – Workhorse is not a SPAC. It didn’t have a merger in Oct 2020. …always seems to be lumped in though. :(

  8. longstreet says:

    ZIRP and Yield Curve control, pounding long rates to all time lows…. by the unaudited, unmonitored, unaccountable Federal Reserve… order to FORCE investment….skewed traditional risk / return parameters and considerations.
    Central Bankers are AFRAID of “free market forces”, and spend their time doing things that interrupt those forces.

    • Einhal says:

      Only when it suits them. Remember when the resident clown in the Eccles building said that the reason that rates were low was that there was a glut of savings?

  9. Earl says:

    Some of the enthusiasm for EV stocks is based on the knowledge that EV use is going to be more and more mandated by governments with connected firms getting handouts and subsidies, A side story of Proterra is the role of energy secretary former Michigan governor Jennifer Granholm who served on Proterra’s board and had many options/shares that she only sold after she received criticism for not selling them when she became energy secretary. As governor she directed Michigan development money to EV related startups.

  10. TwitterFan says:

    Lucid has the best tech to this day winning awards etc. If you miss the boat, because you have Tesla Goggles on, you miss it. Simple. ah, btw, they have the support from PIF.
    Polestar is ramping fast, selling 70k vehicles this year growing 25% yoy. And the fact that Volvo/Geely is behind, is clearly a big plus.

    • Wolf Richter says:

      “Lucid has the best tech to this day winning awards”

      🤣 that’s the kind of hype I love!

    • Anthony A. says:

      There’s nothing like a room full of trophies and walls covered with award certificates when you go BK. The CVEO could hand them out to his staff as they leave the building for good.

      I threw all my “work” awards in the trash after I retired. LOL!

    • Massbytes says:

      Lucid’s top end vehicle will outperform the top end Tesla Plaid by about 10 percent. Too bad the Lucid vehicle is 249K and the Tesla one is 108K. Award winning alright. Polestar sold 70K and Tesla so far this year has sold 920K. Tesla is slightly ahead.

  11. Frank B says:

    Not all SPACs are bad. DraftKings (DKNG) is at $31. Utz pretzel company (UTZ) is at $15. DWAC still doing well at $15! There are others too. But the SPAC EV thing is a good lesson in Greater Fool Theory+Bidenomics. During the pandemic there were a ton of traditional IPOs that were issued that are doing very poorly as well. Robinhood (HOOD) peaked at $85 and is at $11 today. Coinbase (COIN) peaked at $429 and is $88 now. Just to name a few…

  12. vecchio gatto veloce says:

    At the other end of the SPAC spectrum, and in the world of motorbikes, there’s a company in Scotts Valley, California that’s privately held.

    Zero Motorcycles, Inc. was founded seventeen years ago by a NASA engineer. Zero also has a partnership with Minnesota’s Polaris that’s producing, among other things, electric all terrain vehicles.

    However, IMO, a business practice that Zero does is not a good one. Now, they charge subscription fees for upgrades to their already purchased bikes, and these upgrades are already built into the machine. So, owners have to fork out cash, every month, to use something that they essentially have already paid for. To me, that’s bad business (though it may be profitable to Zero).

    But hey, Zero makes E-motorbikes. They make them successfully & in a privately held corporation. That’s good business.

    But yeah, the list of SPAC EV failures that Wolf highlights is pretty amazing, eh?

  13. Pete Koziar says:

    I’m amused that right now I’m seeing a sidebar ad for Lucid in this page. Some search engine caught the mention of it in the text.

    Vehicle “starting” at $82.4k.

  14. 2banana says:

    And remember…

    The EV hype and FOMO of just two years ago is equivalent to the AI hype and FOMO of today.

    • LongtimeLurker says:

      What is also kind of cute is how some of the electric vehicle companies in this article basically or explicitly market themselves as a technology company first, auto company second. Of course we all know why.

    • Seen it all before, Bob says:

      It’s funny that a new hype arrives when the Tech stocks begin to sink.

      AI is the latest. AI stocks went up 40% in a few months.

      The majority of “wealthy” people still have WAY too much money that allows them to speculate.

      “Give me a new hype and I can move the world” – Me

      “Give up on 5% and go for 100%” – Many young financial advisors today.

  15. SomethingStinks says:

    I must admit I fell for this as well. Bought some SOLO after seeing one of their shiny vehicles parked at a mall here in Phoenix. They recalled all their pathetic 20 or 50 or whatever number of overpriced battery operated single seater crap vehicles they sold, earlier this year. Will not make that mistake again; no EVs or stock for atleast another decade.

  16. longstreet says:

    Pardon the off topic…
    Shouldnt the Fed’s “unaudited” 2nd quarter report be out by now?

    • Wolf Richter says:

      No. Way too soon. In early September. Just look up when the last Q2 report was released, which was on Sep 7, 2022. It’s not rocket science. But spreading BS is a lot more fun than looking stuff up.

  17. Imposter says:

    Geeezzz, these seem to have more than their share ending in bankruptcy.
    Feels like an off Broadway play of some kind. Tickets are hyped and the scalpers drive the prices high. By the time the show starts and gets to the 3rd act, the audience begins to leave early. Yet the producers and actors are all raking in bonuses and salaries sucking what cash there is out of the production. Walking away later via bankruptcy and leaving only the burnt cinder of the entire show.

    Is this the same script the solar panel craze performed of a few years back? Sure sounds familiar.

    Wonder what subject the next production of this play will use? Can almost hear the scalpers now….”tickets here, get yer tickets here”….

  18. CCCB says:

    I always amazes me every time I see these charts. Why are the prices for these “companies” not all ZERO?

    I guess there are still greater fools out there thinking they’re getting a deal at 3 or 10 or 20 cents on the dollar. Dumb and dumber.

    • Wolf Richter says:

      “Why are the prices for these “companies” not all ZERO?”

      This is a funny part of the day-trader mentality. Even after the company liquidates, and creditors have taken everything, the shares continue to trade over the counter though they no longer represent anything. The hope is than you can buy them at 10 cents and sell them at 20 cents and make a 100% profit, and it doesn’t matter that these shares no longer represent anything (the tens of thousands of cryptos have now formalized this mentality). This can go on years until eventually interest dies down and there are no more bids, and then those people that last bought them have those shares stuck in their brokerage account at near-zero value (last trade) and cannot even give them away. And, if after a few years, they get tired of looking at this line item, they can contact their broker ask them to remove the shares manually.

      • Anthony A. says:

        “This can go on years until eventually interest dies down and there are no more bids, and then those people that last bought them have those shares stuck in their brokerage account at near-zero value (last trade) and cannot even give them away. And, if after a few years, they get tired of looking at this line item, they can contact their broker ask them to remove the shares manually.”

        This happened to me once in the early 2000’s. Embarrassing to call your broker and have them remove 200 shares of XYZ sitting there at $0.04 per share for a couple of years. Not going there again though.

        • BLee says:

          This happened to me from owning Yahoo shares as it was taken over by Altaba. I had owned Yahoo since their IPO and held all the way through when they were taken over by Altaba. When they went private, the shares I had went into what my broker calls ‘escrow’ and what I had left was some funny escrow # taking up a whole line on my account with no represented value. When I called TDA to ask about removing them, that’s where I learned about this whole escrow thing. Then 2 years ago when Schwab was in the process of taking over TDA, they issued to nearly all foreign account holders that they would be closing foreign client accounts. However, because of the escrow, TDA told me they ‘Legally could not close my account’ so I was left with an account in a frozen ‘sell only to cash’ state (meaning I had to choose wisely which stocks to own for several years). Owning BRKA was the plan and I still hold this TDA account hoping that 1 day, they may change the rules to allow overseas resident status accounts.

      • BobE says:

        I have some Pre-2000 General Motors paper shares framed on my wall as a constant reminder of what the market can do.

        They are very pretty and have artistic value.

      • Imposter says:

        Your description of the mindless, mining of the last of the “greater fools” trades of a bankrupt stock reminds me of the dying embers of a once warm and pleasant camp fire. Each winking out without any notice.

        It is as complete, and accurate of a description as I have yet seen.
        Thank you Wolf!!!!

  19. LongtimeLurker says:

    A booming E.V. segment are electric bicycles. We might see similar growth, real or fake, in this segment. At the moment, the electric vehicle tax credit does not apply to electric bicycles because the eligibility rules explicitly state that, “it(electric vehicles) must also have at least four wheels.” Which has lead to a new bill proposed called the, “Electric Bicycle Incentive Kickstart for the Environment Act” that seeks to extend tax credits to electric bicycles that do not assist over a traveling speed of twenty-eight miles per hour and cost no greater than eight-thousand dollars. There are already companies dedicated to electric bicycles and traditional bicycle companies have come onboard. Riese & Müller, Gazelle, TREK, Walmart, and Cannondale Bikes to name some of the current players. Should this bill pass then I would not be surprised to see Tesla also move into that market as e-bicycles sell for a higher price than bicycles, they are already a household name in electric vehicles, and they want the tax credit benefit to uplift sales.

    • Arnold says:

      I really doubt people will pivot from buying an Ford F-250 to an electric bike.

    • El Katz says:

      I cannot fathom Tesla becoming involved in a low margin high volume business such as bicycles and competing with the likes of Walmart. The liability, alone, would scare anyone with any common sense.

      What compromises a lithium battery? Impact, among other things. How often are bicycles dropped?

      Did you read about the bicycle shop in NYC that burst into flames and killed 4 people living in the apartments above? Read the fire commissioner’s statement on that event:

      ” The early-morning fire at an e-bike store in lower Manhattan that left four dead was caused by lithium-ion batteries, the city’s fire commissioner said Tuesday.

      “It is very clear that this was caused by lithium-ion batteries and e-bikes.”

      • roddy6667 says:

        In China electric bicycles and scooters are everywhere. Like you pointed out, battery fires are a problem. Many cities have passed an ordinance banning EV storage inside a home. They must be left in the parking garage or in the hallway outside the unit. The buildings are all concrete, so a bike going up in flames in the hallway is not a huge problem. Inside a home, it could kill a sleeping family. Chinese fire departments are very modern. They make American FD’s look like an 1890’s re-enactment. However, it is rare to see the trucks roll. What’s going to burn? The couch? 99% of the time it is for a car fire.

      • Mano Appapillai says:

        Or fossil fuel contract fire ?

  20. Hubberts Curve says:

    In additional to the financial chicanery involved in these Spac’s ,I think it is dawning on the industry that building EV’s profitably is not easy. Tesla is probably the only one to do so ( and only recently) because they evolved in to a design that is basically a battery on wheels, built like a washing machine. I have been watching videos of the disassembly of the latest model Y Teslas, and their magic secret ( in my opinion as a mechanical engineer) is that the make the battery in to a giant glue and foam monocoque that then gets the seats bolted to it and becomes the entire bottom of the car. The coolant tubing and distribution manifolds look like they are straight out of a washing machine. This is all very cleaver and puts them way ahead of the other manufacturer’s ( cost wise) that are still trying to build normal cars with big batteries bolted inside. The only drawback I can see is, that like a modern washing machine, they are built as throw aways.
    Sure you can replace the electric motor and stuff easily enough, but any problems internally within the battery, or collision damage to the exterior that impinges on the giant battery belly pan, or die cast rear structure and the car is toast.

  21. California Bob says:

    On a related topic, I wonder how many, if any of the electric ‘air taxis’–Joby, Lilium, Archer, etc.–will survive? They will be at least reasonably vetted for safety by the FAA, and ‘self-flying’ is more plausible than ‘self-driving’ due to simpler, straighter, fully defined routes to fly with navaids, true autopilots and oversight by the ATC system.

    Will anybody get into a flying craft without a pilot (or two)?

  22. Beg4mercy says:

    At the height of 2021, disposable income was helping fuel global stupidity, as inflation seemed transitory and inconsequential. That pandemic helps explain some of that exuberant froth. The ground was sown with seeds that exploded, helping create a global passion for tossing money at anything that was going up. That narrative remains deeply entrenched in current mindsets that are resilient to examining realistic valuation analysis.

  23. Herpderp says:

    Ah Nikola, an exceptionally egregious fraud. Claimed they had a working electric semi, with a video to prove it! And then it turned out they had the prototype towed to a long low hill and only filmed it rolling. Using the size and grade of the hill to mask there was a hill at all. I believe the founder was convicted of fraud for the fiasco, perhaps other lies. If you cant be a Tesla you can LARP as Telsa… until the SEC catches up to you.

  24. Alan says:

    It would have been nice if anyone here had defined what the opaque acronym “SPAC” means.

    Damn, do I hate the lazy use of acronyms!

    • Bobber says:

      Special purpose acquisition vehicle. It’s a way to take a company public with more limited SEC disclosures.

    • SoCalBeachDude says:


    • BuySome says:

      Space Patrol Accelerated Crash.

    • VintageVNvet says:

      Me too A; how some ever,,, acronyms have become endemic with the use of smarty pants phones now made worse by funny faces and other emoji, eh?
      While keeping in mind that comments in general are NOT ”formal” writing, it certainly would be useful to have some reference to the particular use of acronyms for finance and economy, especially those that have other or many other meanings in other fields, as many do these days.
      time for a new ”app” eh???

    • viscacha says:

      put the abbreviation in your browser, check it, go “back” to ws -easy peasy

  25. Nick Kelly says:

    Related: I read that the US govt is going to subsidize a bunch of EV charging stations. Sounds legit, but I was amazed, if I’ve got it right, that there will be two incompatible types: Tesla’s and the other, which has seven auto outfits involved. Are the latter the only ones to be subsidized?

    My point is simply that standardization of electrical infrastructure is a legit govt task and it has the legal tools to do that. If most of the existing ones are the Tesla type then the new ones should be too. Maybe take a cue from that babe running the EU anti-competition dept, who forced charging- port standards on a well- known cell phone co.

    A bit of levity, but true, re: lack of standards:

    My bro years ago headed to US with new gal. He was driving an old LeMans, a GM car. To be careful he dropped off his flat spare tire before trip. When he picked it up they gave him the wrong one: on a Ford wheel. A day later in pouring rain he is trying to change a flat. Those 5 holes look so, so, identical…but they aren’t. He would get three holes on studs and kept thinking he could wrestle the others on. After ten minutes he lost it and says he started banging on the uncooperating studs with a rock. Who would lie about that? Wonder what the gal was thinking: ‘Maybe I don’t want a caveman?’

    • Herpderp says:

      Most manufacturers (Polestar, Mercedes, Ford, GM, Volvo, Rivian) have announced they are migrating from the open standard (CCS1) to the tesla supercharger style port (NACS). SAE International is taking over the management of NACS standard from Tesla so all those OEMs wont be beholden to a rival to define it going forward. Both CCS and NACS already use the same communication protocol (Plug and Charge) so adapters should function. As to Tesla opening up their private network of chargers to other brands Im not certain, but the plugs in theory will all fit and work. The reverse thought, a tesla using a “public” charger with a NACS port will/does work. They can already use CCS plugs with an adapter. CCS is likely extinct within the decade.
      CHAdeMO is already dead outside of Japan. J1772 was suplemented by CCS.
      TLDR: well on its way to standardization in north america.

      • fullbellyemptymind says:

        Anyone remember Standard Oil? Care to guess how they got to that name?

  26. Northernlights says:

    If Rivian wasn’t so good at marketing, they would have been another SPAC. That seems to be the true genius of the person running the show, especially in context of what he did with Mainstream Motors aka Avera Motors.

    I lived close to them when they were spinning tales about starting up car manufacturing in Florida! They managed to obtain a few million of funding from Florida to build a mysterious prototype (or maybe two) which never saw the light of day, after which they left the state to start over. At this point Tesla was a real company making EVs, so Rivian was in a great position to make some new promises and raise a ton of cash.

    The most recent earnings release included a statement along the lines of ‘profitability per vehicle has improved by $35k’ where a more accurate statement would be ‘losses per vehicle have decreased by $35k.’ That kind of doublespeak makes me twitchy.

    • Wolf Richter says:

      Yes, mass production of big complex products is a bitch. If you want to build 400,000 trucks a year, and you figure that you will break even at 200,000 a year, you’re going to lose an arm and both legs until production gets close to 200,000. It’s all about the per-unit cost, which declines as you produce more units.

      If you build just 1 truck per year, the per-unit cost may be $1,000,000. But if you build 1,000,000 trucks per year, the per-unit cost may be $30,000.

      During the ramp-up of production of a new model, especially coming out of a new factory, ALL automakers lose a gigantic amount of money. Mass production is a huge money-suck until you get your volume where it needs to be. And when you get beyond it, you’re awash in profits, hopefully. Like Tesla now. But Tesla lost over $20 billion over its first 10 years trying to get production up, and almost didn’t make it when the Model 3 came out.

      • Monkee says:

        The biggest issue with Rivian (and basically every other mfg company that decided to get into automotive) is that it’s engineered like an airplane, but trying to be sold as an automobile. Those two worlds of manufacturing could not be more different. Every airplane is a unique flower, and they cost as such. Every automobile cannot be unique. But Rivian builds their battery boxes like an airplane. Extrusions and welding. But the extrusions are so inconsistent that they can’t be robot welded. Very few find success in automotive. Including suppliers.

        • roddy6667 says:

          I read about a Rivian owner who had a minor fender-bender. No problem, the body shop should be able to fix that in a day. The repair cost $42,000! Collision insurance must be huge.

  27. Kiers says:

    SPAC: special purpose acquisition company!

    Remember when Carson Block investigated SPACs for his “short report”, and soon enough his investigation came up against a “ruling party connected” biggy SPAC promoter, next thing you know……FBI raid at 5am on Carson Block! Full Monty treatment!

    He quit the SPAC investigations.

    That should tell you all you need to know

  28. old school says:

    I read the Barrick gold quarterly transcript. They know mining and I think are biggest miner operating in the US. They mine both gold and copper because they can be similar operations.

    Their discussion on copper mining is interesting. The bottom line was the US is blessed with good copper resources, but most of it is not going to be mined unless US regulators change their attitudes about copper mining.

    Clean energy needs a lot of copper.

    • Thomas Curtis says:

      Absolutely my view. Copper was added to the critical minerals list the other day which will give U.S. copper miners some boost. It’s not just copper, lithium, and rare earths that we will need but lots of all of the metals and minerals in order to green up energy and build out the 2nd and 3rd worlds. The 2nd and 3rd world’s won’t be too interested in avoiding carbon if they have to remain poor.

      • Beg4mercy says:

        Dr Copper is looking strikingly similar to small cap indexes, both of which aren’t participating in the euphoria related to no recession and super smooth helicopter landing.

        That’s actually pretty interesting that the explosion of EV demand and unlimited cash being touted by algorithm-news hype, isn’t correlated with overall economic strength or market bellwether stuff. Probably nothing matters, because everything is fantastic news and no one needs to fear a lack of cash.

        I’m kinda reminded of all those people buying SUV luxury transportation before the GFC, probably a coincidence, definitely this time is absolutely different and we’re about to go into a new era of euphoric ecstasy!!

        • HowNow says:

          “It’s different this time.” The four most expensive words in the English language – John Templeton.

        • Thomas Curtis says:


          Copper is upset with China and its housing market where maybe half of the world’s copper has gone in recent decades . It also can’t decide if the world in general is heading toward growth or recession. Long term, copper is a sound bet because the world can’t green or grow without it.

    • kiers says:

      hey, right before the boreal forest went on fire, (27 million acres and counting), Trudeau pulled a bidenomics subsidy deal for mining in the uncharted no-paved road Boreal.

      the very “green” boom is responsible for burning the planet once and for all. it’s all so venal.

      I call trudeau: the caligula of canada

      • Tudor says:

        The greewashing of this final stage of environmental pillaging in our terminal capitalism is absurd. We have to destroy the environment in order to save it! Guess what- we either give up most modern convenience like travel, transportation, industrial production, or we will be forced to do it. Either way, laws of Nature prevail, not of Man.

        • Thomas Curtis says:

          Rio Tinto is building a very large solar array in the Canadian North. I wonder why?

  29. The Real Tony says:

    It’s good to see these company’s shares dropping to where they should be unlike the rest of the major U.S. stock indexes.

  30. Thetenyear says:

    One of these days you will be adding a big F to your charts. There is no way Ford can overcome their EV challenges without significant help from the government. Ford is still losing a boat load of money on EV’s despite taxpayer bailouts in the form of tax credits.

    Direct bailouts for Ford are coming. Not touching Ford stock without being able to calculate the present value of future bailouts.

    • SoCalBeachDude says:

      Ford will simply go fully bankrupt with no bailout ahead. They’re already dead in the water in the car business and the only car they even offer is the very dated old Mustang pony-car throwback to the 1960s.

    • SoCalBeachDude says:

      Ford is losing around $30,000 for each electric vehicle it offers but plans to make up its losses on volume!

      • Wolf Richter says:

        I’ll just repeat it here:

        Yes, mass production of big complex products is a bitch. If you want to build 400,000 trucks a year, and you figure that you will break even at 200,000 a year, you’re going to lose an arm and both legs until production gets close to 200,000. It’s all about the per-unit cost, which declines as you produce more units.

        If you build just 1 truck per year, the per-unit cost may be $1,000,000. But if you build 1,000,000 trucks per year, the per-unit cost may be $30,000.

        During the ramp-up of production of a new model, especially coming out of a new factory, ALL automakers lose a gigantic amount of money. Mass production is a huge money-suck until you get your volume where it needs to be. And when you get beyond it, you’re awash in profits, hopefully. Like Tesla now. But Tesla lost over $20 billion over its first 10 years trying to get production up, and almost didn’t make it when the Model 3 came out.

        • whatever says:

          No argument here but the question is who will buy Ford electric vehicles to get them to break-even? The high paid tech engineers and CPAs who buy electric cars wouldn’t be caught dead in any Ford, and Ford’s mid-market customer base can’t afford or want an electric car. The government mandates can’t force people to buy things, and I think Ford is counting too much on the heavy hand of government to force the market to electric along with unicorns and rainbows.

          By not hedging their bets on a low cost ICE line, or even hybrids, I agree with others they’ll be on government bailouts for a long time.

    • Braincramp says:

      Wow, you mean, politicians get involved in the market? That seems to turn out pretty well.

      Trump officials pushed for the Yellow bailout. Granholm was on Proterra’s board while Governor of Michigan; Biden visited the company and pushed away.

  31. Thomas Curtis says:

    Even Cramer was skeptical of SPACs.

    Me, I don’t buy into anything without decent book value, earnings, and cashflow. That is for VCs and major trading firms that have lots of experience, know how, and get to see the inside of ‘the wonderful new idea’.

    For retail investors most of high tech falls into that category over the long haul.

  32. Gen Z says:

    Many of these stonks have websites which indicate that there are additional costs like Managers and Supervisors getting paid in American salaries, so are bag hodlers paying for the C-suite salaries and retirement plans? What a scam.

  33. Swamp Creature says:

    Didn’t Biden have them in the White House a few month’s back celebrating them as the future for America’s Transportation System.

    • Wolf Richter says:

      That was a year ago. He had the CEOs of the 3 legacy automakers — GM, Ford, and Stellantis — in the WH, but not Tesla. The fact that Tesla isn’t unionized in the US is part of it. Musk got pissed off because the WH had not asked him to be part of it though Tesla is by far the biggest US EV maker. None of the companies here were represented.

  34. JoshT says:

    Hey Wolf,
    Thank you for covering this. Here is another one you can consider adding to this list specifically. Ticker NXU, previously AMV (Atlis Motor Company.). Ultrafast battery charging company. IPOd last year at $27.50, jumped to $243. Now trading at $.22

    • Gen Z says:

      It looks like this company spends more time (and investors’ monies) on YouTube than delivering products. STONK!

  35. SoCalBeachDude says:

    At the turn of the century in 1899 the future of EVs looked very bright and poised for significant share after Ferry Porsche introduced the first EV created in 1898. But alas market demand peaked at about 20% in 1916 before falling to nearly zero within a few years. Today, EV demand globally has returned to about 6% of the global market with around 94% of global demand remaining in cars with actual motors that function by using gasoline for which demand is rising globally.

    • Wolf Richter says:

      EVs are older than that. They competed with steam-powered cars. Porsche didn’t invent them.

      The first recorded motor-vehicle traffic fatality in the US occurred in 1899 in Manhattan, when a guy was run over by an EV! A the time, EVs were common, and better suited for urban traffic than steam-powered cars, which were preferred for longer road trips.

      On September 14, 1899, Henry Bliss stepped off a streetcar at West 74th Street and Central Park West in New York and got run over by a taxi. A plaque points out that it was the first automobile fatality in the “Western Hemisphere.” The taxi was an electric vehicle. As were 90% of the taxis in New York City and about 30% of all cars sold in the US.

      • SoCalBeachDude says:

        The first real EV was done by Ferry Porsche in 1898 long after the first internal combustion cars were invented independently by Gottlieb Daimler and Karl Benz in 1886. EVs never really caught on much until the early 1900s and then that passing fad only really lasted until 1916 or so with the most popular ones being the Baker Electrics. My old friend Gertrude Cohn used to drive her Baker Electric down from her home on Readcrest in BH to the Beverly Hills Hotel on occasion and Jay Leno has a Baker Electric in his large collection. Cities were the primary popular place for EVs in America and there were charging stations on every main street in New York.

        • Wolf Richter says:

          You need to review your EV history.

          The first semi-practical EVs date back to the mid-1800s.

          “Here in the U.S., the first successful electric car made its debut around 1890 thanks to William Morrison, a chemist who lived in Des Moines, Iowa. His six-passenger vehicle capable of a top speed of 14 miles per hour…

          “Over the next few years, electric vehicles from different automakers began popping up across the U.S. New York City even had a fleet of more than 60 electric taxis. By 1900, electric cars were at their heyday, accounting for around a third of all vehicles on the road. During the next 10 years, they continued to show strong sales.

      • Z33 says:

        Jay Leno had a good segment on his late 19th century EV the Baker Electric. IIRC, he said they were popular then for women as they were clean and had no exhaust to mess up their dresses unlike the ICE cars. Pretty cool history he went into with the car.

      • viscacha says:

        google “photo nyc plaque henry bliss”

  36. Chase Metz says:

    Hello. A little off main theme but are you now what is called a TESLA “fanboy”? Here in Houston I see a lot of Model 3’s on the road these days so I would agree that there’s market representation. However what about a P/E like the rest of the old line vehicle manufacturers and the millions like me who consider them functional around town enclosed golf carts but in no way our mainstream transportation. Thank you

    • Wolf Richter says:

      “…are you now what is called a TESLA “fanboy”?”

      LOL. I’m not even a fan of the cars. And the share price, though it has come down a lot, is still totally nuts.

      Like I always say: If had too much sleep and wanted to lose some, I would short the stock. But obviously, given the violent up-moves, that’s a really bad idea.

      But I love what Tesla has done to the oligopolistic legacy automakers. I worked in that industry for a decade, and I tell you, these companies had it coming. I’ve waited for a long time… I’m having a huge amount of fun watching all the turmoil in the industry as the old self-satisfied assumptions get thrown out the rear window.

      And in terms of the industrial and tech economy in America, EVs are one of the best things to happen in a very long time. There are gigantic EV-related investments being made in the US – and have been for a few years. This is an enormously good thing.

  37. island teal says:

    Paging Chamath Palihapitiya, Paging Chamath Palihapitiya.
    Bring your SPAC – we need your help .

  38. Beg4mercy says:

    Perhaps somewhat related to SPAC-onomics, is the weird relationship I’m currently looking at between Dr Copper continuous contract and its relationship with 5 year Treasury price.

    I’ve been watching various treasuries, where the yields are drifting a bit higher m but, people are paying a premium to chase future yields — which kind of defeats the purpose of getting a higher yield.

    While that’s happening, Dr Copper looks weak and anemic, headed into the immaculate recovery, and small caps are bleeding to death and have gangrene going back into 2022.

    I’m thinking the excessive exuberance from SPACmania is very much still deeply ingrained in the current narrative.

    • old school says:

      I notice numbers. Seems like Russel 2000 and an oz of gold have the same price. Will be interesting to see their prices move over the next year or two.

      According to Barrick, all in cost to mine gold is over $1300 now.

  39. Ulysses Rex says:

    Re: It was the era of consensual hallucination, when the Fed’s free money reigned.

    And yet nobody ever seems to blame the Fed for creating this mess in the first place . . .

  40. Where is value ? says:

    I live in eastern Washington state. Originally a Buckeye, long ago, many states ago.

    So how many of you shorted the Pac 12 ?
    Does Wolf have a chart for it ?
    Last I heard we’re down to 4 schools and those 4
    are busily looking elsewhere.
    Rumor has it WSU and OSU turned down
    the SEC (Not !) but are seriously contemplating
    the SAC (Scenic Alaska Conference).
    Yes Wolf your darling (?) Bay area Stanford and UCal dont have great options… ACC a possibility… nothing better for a student athlete to do than airports and lonnnnngggg flights.
    Big 10 (gobbling up the Pac 12) now the
    Pig 18 ? Watch out English, German FC fans… Manchester United, Bayern Munich… are in their cross hairs.

    As for “value” some mention Graham Dodd.
    Creativity has been heavily researched for decades… attempts to automate it for well over a decade.
    One simplistic view of creativity:
    Creativity = Novelty + Value (utility)

    Margaret Boden wrote a book in 1991
    “The Creative Mind”. Interesting book for sure !
    As to the novelty aspect of creativity
    she distinguishes between P-creativity
    (psychological creativity, i.e., personal) and
    H-creativity (historical creativity, i.e. not just novel for the person but for humanity).
    H-creativity implies P-creativity but not necessarily the converse. E.g, reinventing the mouse trap might be
    P-creative but not H-creative.

    As for evaluating the “value” proposition, every investor is supposed to have his good method for doing so. Buffett I believe likes to say
    that growth is but one factor in assessing the value of company’s stock.

    Investors, humans in general, have very different ideas of what constitutes value ! And how.

    Important stuff, I understand the Chinese passed US in patents recently… not all patents equally important.

    • Where is value ? says:

      FC – Football Club (soccer). Anyone good enough to play for premier professional clubs MU or BM presumably will have no trouble transitioning to our college FB. A year or two at most. Smile.
      No not all field goal kickers.
      [Remember the 60s or 70s it was Stenerud. Gogolak, and Yepremian… Europeans all.. who ushered in the soccer style kick… high jumper Dick Fosbury must have loved it… unconventional commonality they ].

      Value investing : Morningstar (or someone) created categories 20 to 30 years ago to classify mutual funds and (?) stocks: value, blend, growth; small, medium, large, mega.

      Value investing has underperformed growth the last 10 years, small underperformed large.
      (In 2021 or 2022 I forget which, value considerably outperformed growth. That was an anomaly for the last decade).

      Many a value mutual fund manager will claim the
      (stock) market is not properly assessing the value of their holdings… just hold on they ask their shareholders…the tide will turn.

      They may be right, I never know just how stretched P/Es and related metrics can get before more caution sets in. Grantham and others have said the market is too expensive for 10 years.
      And yet the market, though rather narrow in positive participation, continues to climb. For a few years now 5 or so large companies have produced a disproportionate amount of the S&P 500 return.

      Morningstar also assigns to what degree a company has a competition thrawting moat (size, patents, networks, etc). I dont directly invest in stocks which is where this is applicable.

      • old school says:

        Every once in a while I will punch in the numbers for Coca Cola or Duke Energy since their value is in the dividend and growth there of.

        To me even these value stocks are richly priced, much less the magnificent seven.

        I don’t really think you can make a case for much with 5.5% risk free.

  41. SoCalBeachDude says:

    Another new GM EV on the way for Americans!

    The 2025 Cadillac[k] Escalade IQ Brings 750 HP and 450-Mile Range, $130,000 Price Tag…

    • Wolf Richter says:

      Yes, they’ll sell several of them.

      I like that they revived the Bolt based on their new platform — but it won’t show up for a couple of years. The Bolt is a mass-market vehicle, and people like it. The cheapest current Bolt, if you can even get one, is priced just below $30k before rebates.

    • old school says:

      I hope no one is going to be virtue signaling me that they are green while driving one of these. That thing is going to take a lot of pollution to make.

      I admire people that truly think about the environment and live the real deal. Mixing US capitalism with green religion and virtue signaling monster luxury SUVs and soon big trucks are what you are going to get.

  42. SoCalBeachDude says:

    Road & Track: It’s Nearly Impossible to Find a Good Used Car Under $20,000

    In 2019, 49.3 percent of used cars were offered for under $20,000. Today, the number is only 12.4 percent, per iSeeCars data.

    • Wolf Richter says:

      Yes, after the 60% price spike from mid-2020 through 2021. Used-vehicle retail prices have come down some, but it’s small compared to the spike.

  43. Lance P says:

    This is no different than 100 years ago when hundreds of new car companies tried making cars in the ascendant new car industry and most were history within a short while.

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