German maker of compact urban BEVs eGo has gone public on the Nasdaq exchange through a business combination with Athena Consumer Acquisition Corp, in the latest chapter of the ‘EV pureplay goes public via Spac’ saga.
“Today is the culmination of a lot of hard work and dedication, and start of the next chapter in eGo’s journey. Nasdaq has always been a hub for innovation, and we are really excited to be a part of this impactful ecosystem,” says Ali Vezvaei, chairman of eGo.
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The company currently sells only one compact city vehicle, the e.Wave X, for €24,990 (c.$26,500). It belongs in a different market segment from even the smallest compact BEVs made by legacy OEMs, given its 11kW battery charging capacity — which the company terms an “optimised size for urban mobility” — and 30kWh battery capacity, as well as its relatively small range capability of 250km.
For comparison, the A-segment BEV Fiat 500-e can boast a battery charging capacity of 70kW and a range of c.320km. So the eGo model has a considerably narrower addressable market than other compact BEVs, not only in terms of range and charging speed but also in terms of the especially small body and ‘pod car’ appearance of the e.Wave.X.
Production optimisation
eGo aims for its unusual production model to help it reach scale with its working liquidity, which equals $285mn in cash and borrowing facilities after listing. The company produces its vehicles in small, low-cost micro-factories, which it says “enable early breakeven with high capital efficiency”.
The automaker completed construction of the first of these micro-factories in Aachen in Germany in 2018. The facility has an annual production capacity of 30,000 vehicles.
The firm’s second micro-factory is nearing the start of construction and the company says it is targeting more, including in the US as it aims to take advantage of tax credits provided by the Inflation Reduction Act.
The micro-factory construction strategy allows the company to eliminate press and paints shop and enable “low capex production”, the company says. As well as removing stages of vehicle assembly, the firm says that it can build a micro-factory or around $60mn.
The company has produced more than 1,350 BEVs, with over 1,200 on the road as of early October. It also reports an 11,000 strong order book.
Spac spectre
Finding a less capital-intensive way to reach scale will be all the more important considering that one of the problems for EV pure play challengers’ business combinations with Spacs has been a lack of capital injected through going public via this route. Of the EV pure plays doing Spac deals, most have struggled to reach scale.
Lucid has been dogged by demand problems owing to high prices aimed at the luxury market, Lordstown Motors was delisted from Nasdaq in July after filing for bankruptcy, and Faraday Future has cycled through a series of cost-cutting measures as its stock price languishes near $1. US EV firm Canoo took on an unnamed institutional investor early this month after cash levels dwindled alarmingly.
Vietnam’s Vinfast went public and made an explosive debut on the Nasdaq exchange in August, quickly jumping to a market cap greater than legacy firms Ford and GM within its first day of trading. Stock peaked at $82/share two weeks later but have since sunk nearly 80pc from this point.
Ciaran has written about finance, politics and culture. He is passionate about e-mobility and what it means for our way of life.
Ciaran has a Masters in Ancient Philosophy from Oxford University.
