Thanks for Visiting!

Register for free to get the full story.

Sign Up
Already have a Placer.ai account? Log In
Back to The Anchor

Autos, Inflation, and EVs: Over 250 New EV Nameplates are Going to Require a Lot of Showrooms

Thomas Paulson
Aug 19, 2022
Autos, Inflation, and EVs: Over 250 New EV Nameplates are Going to Require a Lot of Showrooms

  • Last week, we learned from J.P. Morgan’s Automotive Conference that consumer demand remains strong, industry supply chain conditions are normalizing, but supply won’t match demand till the end of 2023, and prices will remain high until 2024.
  • On dealerships, while there are substantive long-term concerns about the dealership model (DTC, fewer breaks and fixes, etc.) these businesses generate substantial FCF and offer multiple options with what to do with their excess capital generation. This allows dealers to build stock when production increases, whereas online-only retailers such as Carvana, Vroom, and Shift do not generate free cash flow, and their cost of capital has recently appreciated spectacularly. Online-only car dealers will be encumbered in adding inventory, as well as in increasing marketing spend (i.e., surviving takes precedent over growth).
  • GM shared that it expects to produce 1M EVs in North America in 2025 compared to its current level around 100K, with the growth coming from Hummer, Silverado, and Lyriq as well as lower priced models like the Bolt, Blazer, and Equinox.
  • The prediction that struck us the most was IHS’ forecast calls for Tesla’s share of the U.S. battery electric vehicle market to decline from 71% in 2021 to just 10% by 2030, as the number of industry-wide EV nameplates explodes higher, from 26 in 2021 to 250+ in 2030. That's a lot of consumer choice.

Schedule a Call

Required
Please enter your email
Required
Required

Thanks for reaching out!

I’ll be in touch soon

Go Back
Oops! Something went wrong while submitting the form.

Thomas Paulson

Director of Research and Business Development, Placer.ai

Thomas Paulson spent 20 years as a Wall Street analyst and a member of asset management teams at AllianceBernstein and Cornerstone Capital, representing top-50 ownership positions including Target, Home Depot, Nike, Amazon, Google, and many more.

He brings consumer related expertise and knowledge of enterprises in retail, CPG, financial services, telecom, and entertainment.

Schedule a Call
Related Articles