EV Investment by Auto OEMs: OEMs have invested or signaled future investment in electric vehicle (EV) manufacturing capabilities and capacity. These investments are critical to support strategic goals outlined by OEMs, who are targeting 50-100% of annualized sales being EV by 2030.
However, as consumer demand has softened amongst a higher interest rate environment, smaller EV startups have struggled to grow / maintain market positions. In contrast, legacy OEMs have maintained their position by offering a diverse set of powertrains, with hybrid models seeing increased demand due to shifts in consumer demand.
As evidenced by recent moves (e.g., Volkswagen’s partnership / JV investment up to $5B in EV startup Rivian), legacy OEMs are seeking to share in development and R&D with new entrants to ultimately bolster EV offerings and gain share vis-a-vis first movers (i.e., Tesla).
While EVs will continue to scale, consumer slowdown has also impacted OEM strategies — notably, from OEMs such as Ford (delaying $12B of EV investment) and Mercedes Benz (pushing out the timeline for fully electrified vehicle sales by 2030).
