It seems that all around the investor community are the EV electric vehicle stocks - and only the big ones at the Los Angeles Auto show - Tesla TSLA Rivian RIVN and Lucid LCID One EV company that has been under the radar until the production version of its Ocean EV SUV is unveiled by legendary automotive designer Henrik Fisker.
It is a competitive package and penned by Henrik himself, and in top trim form the Ocean is targeting over 350 miles of range from an all-wheel drive, dual motor setup pumping out 540 horsepower.
While these figures are noteworthy, there are other EVs that can match these figures in the price range around $65,000 for the higher end Ocean. The base Ocean is called the Ocean Sport, which uses a smaller range battery targeting around 250 miles of range and a single-motor front wheel drive, which will start before any state and local incentives at $37,499.
At that price level, no one, even Tesla, can match that price in the premium EV landscape. Henrik Fisker spoke to Yahoo Finance at the LA auto show about how the company plans to make this pricing work.
Fisker said from the company's imposing stand on the convention floor, the company has a whole asset-light business model - it's a little bit like Apple AAPL Foxconn if you want to focus on the product, the marketing, the design, the development, and then we outsource manufacturing. We don't have to put thousands of dollars in each car because we have to keep the lights on in the factory, and pay real estate taxes and whatever it is. Fisker is using large contract manufacturer Magna MGA to build its Ocean SUV. Magna makes cars and large components for clients like BMW BMWYY GM GM and even Ferrari RACE. One area that puts upward pressure on the price tags of EVs is battery. Fisker is using CATL, the world's largest battery manufacturer, to make a custom package for the Ocean, using cheaper LFP lithium iron phosphate battery cells for the Ocean Sport model, and more energy dense nickel manganese cobalt cells for extended range Ocean trim levels.
Fisker wants this car to be the most sustainable car on the planet, hence the name Ocean. He says the idea with this vehicle is to make it the world's most sustainable vehicle, so we've got a solar roof that can give you up to 1,500 miles for a year, and we've got a fully vegan interior with recycled materials. Even the carpets are made from recycled plastic bottles and fishing nets from the ocean, and the carbon fiber elements on the car and wheels are recycled.
The company is seeing good interest in a car that won't see the streets until the third quarter of 2022, with 20,000 reservations in the order book right now. This is according to plan.
Fisker understands that production is hard compared to prototyping. Elon Musk, Tesla's chief executive, says this almost daily. It is an extremely complicated process that requires proper systems, technical partners, and of course capital to get right.
Fisker says that the challenge for EV startups is to ramp up and produce several hundred thousand vehicles a year, and not take 10 years to do it. Fisker's partner Magna comes into a game with its ability to produce thousands of cars a year, coupled with new capital raises. Fisker has made $1 billion through its SPAC IPO this year and $600 million in debt offering to invest in R&D and acquire know-how and parts from technical partners. It is the only way that startups can compete with the Fords and GMs of the world.
A car is made of about 1,500 parts or even more, depending on how many screws you count, and all these parts have to come in just in time. They have to be put together exactly at the right time in the right sequence, Fisker says. It has taken the traditional car industry many, many decades to perfect this, and that's something they're really good at.