Industrial subsidy race, Tier to be acquired by Bolt, Pay what you weight - MOBILITY BRIEF_ ??????? - May 19th

Good Friday everybody, it's time for your weekly Mobility Brief! ???

On the menu this week

?? Worth Your Attention

???Factories: the great subsidy race

In today's globalized economy, every politic choice can have a significant impact on investments and therefore on the global and local economy. The arrival of Asian EVs in the European and American markets has put significant pressure on governments to preserve their industries and they act accordingly: the Inflation Reduction Act (IRA) for the USA and most recently, we shared it in our last Mobility Brief, France’s green industry bill. Let's go back to it as it was officially introduced on Tuesday.

Below are the measures announced.

In yellow, two measures that are directly in response to new tax subsidies in the United States:

• Green tax credit: France?will spend €500m a year;
• EV bonus?linked to the carbon footprint of the vehicle production. As for EV, batteries represent more or less 50% of the value of the vehicle (source: VDA, German Association of the Automotive Industry), easy to see the idea behind it: promote the implementation of gigafactories and to favor goods produced on EU territory.

In the long term, these measures will undoubtedly lead to more ecological vehicles in terms of CO2 emissions during production, but in the short term, who will be impacted? Surely the households. Will an EV manufactured in Asia without bonus be still cheaper than a European EV with bonus?

Those protectionist policies can sometimes lead to quite strange situations as with EU and Britain post-brexit laws. To avoid tariffs, starting from 2024, the trade agreement stipulates that at least 45% of the total value of an EV sold within the EU must originate from either Britain or the EU. The challenge lies in the fact that, as said earlier, a battery pack can represent up to 50% of the total cost of a EV. Even though many investments are planned, Europe currently lacks a sufficiently established battery industry. Then, it represents a substantial competitive disadvantage for European manufacturers compared to their Asian competitors in the UK market. If the matter is not resolved, Stellantis issued a warning, with the support of the VDA stating that British car plants would be forced to shut down, resulting in the loss of numerous jobs. It didn't fall on deaf ears: Britain said on Wednesday it was in talks with Brussels, and London is working hard in securing the Tata Group/JLR deal for a gigafactory. The future of the British automotive industry is at stake.

The manufacturers have understood that they have the means to put pressure on the politicians and we have other examples.

• After several months of uncertainty due to energy prices in Europe and the US climate plan, Swedish company Northvolt has finally announced that it will set up a gigafactory in Heide (for which the amount of federal subsidies is still unknown).
• Stellantis announced Monday that it is halting the construction of its battery plant in Canada, in partnership with LG Energy Solutions (€3,6 Bn) due to a disagreement with the Canadian government over subsidies. Will the story end like this? We don't think so.

"To date, the Canadian government has not respected the commitments made. As of now, all construction work related to the production of battery modules at the Windsor site has been halted.” (translated from French, Stellantis email to the AFP )

These twists and turns will not prevent the transition to EV which is already well underway and seems to be only a matter of time. Innovation continues and so much the better.

• NIO蔚来 and 壳牌 are launching their first battery swap station in Harmelen, Netherlands
• Ample , the battery swap start-up, announced its second-generation of swap station that cuts its entire process down from ten to five minutes.

Grab your popcorn, the great subsidy race is only getting started!

??? What You Pay Is You What Weight: New Car Parking Policies Aim At Reshaping The Urban Car Landscape

Urban tolls, low-emission zones and now weight-based residential parking fees: cities want to redefine the mobility equation inside their bounds, and innovate through policies in order to help their citizens to adapt their mindset and their habits. Lyon and Montreal have both launched a new residential parking scheme, designed to optimize the fee depending on the engine and the weight of the vehicle: the less you weight/the cleaner your engine, the less you pay. It’s as simple as it gets. We can already hear coming the defenders of their four-wheeled companion, yelling for their freedom of mobility. Yet, it is plainly making sense, and not only for an environmental matter: the weight and shape growth from our cars in the last decades is simply becoming unsustainable for our cities as it became both a safety and quality of life issue. Measures to accompany the growth of bike usage, which is both a plus-value for our health and the footprint of mobility in our cities, could not go on without progressive measures reasoning the car use. As for the safety benefits, I’ll just share you a stat and a picture that is worth a thousand words: a 450-kg increase in a vehicle weight result in a 47% percent increase in fatality rate.

?? Tier Mobility rumoured to be acquired by Bolt

Brace yourself, consolidation is coming for the shard micromobility industry, as Tier Mobility rumoured to be acquired by Bolt in the coming weeks. Looking back, things have not been going well for Tier for some time. Some figures:

• 80 employees laid off (16% of staff) in August 2022
• 100 employees laid off (7% of staff) in January 2023
• €130M debts

The latest blows to the German company being: the tender lost in Oslo in March 2023, the exclusion from Vienna tender in April 2023 and the ban of free-floating e-scooters in Paris from September 2023, voted in April 2023 (see the Mobility Brief).

Tier is not the only company to be in this situation (remember the Replay 2022? Bird lost almost 96% of its value last year) but would allow Bolt to seek for complementary territories.

As Bolt seeks to turn profitable next year and to go public in 2025, this acquisition, at lower cost we imagine, could be a good plan for the Estonian!

?? What Else?

• ??? 谷歌 announced last week during its I/O event some new features for Android Auto: better UI and UX, multi-tasking, Cisco, Microsoft and Zoom integration to participate in all your meetings (no more peace, really a good news?). In the meantime, Motorola is launching in EU the MA1, for €90, an adapter to get wireless Android Auto.
• ?? After 2030, SEAT S.A. will no longer produce cars but will focus on micromobility. An unprecedented strategic shift in the industry. The 80 year old brand will hand over to its premium subsidiary CUPRA , which will continue to produce cars. The first of many?
• ?? To enhance safety measures, Waymo has introduced safety alerts in its robotaxis to prevent potential collisions between cyclists and exit doors. According to the San Francisco Municipal Transportation Agency, this kind of collision is the second most common that results in injury or death.
• ?? Too good for advertisement? Well, no longer the case for Tesla, as it’s been confirmed they are currently considering starting advertising as announced by Elon Musk on company's annual shareholder meeting, on Tuesday: “We'll try out a little advertising and see how it goes”. Elon also confirms two new EVs and one silhouette has been shared.

???AV Updates

• Cruise and Waymo are approaching approval to charge for round-the-clock robotaxis in San Francisco. The drafts will be heard on 29 June.
• According to a report, 比亚迪 plans to compete with Tesla's Autopilot by introducing its own driver-assist software for highway driving.

???New Car Reveals

• Building on the success of the Arkana and the Austral, Renault will launch a premium coupe SUV: the Rafale. This name is a nod to the history of the manufacturer, in 1933, Louis Renault, founder of the brand, acquired the aviation companies Caudron. In 1934, the C460, was rebranded as the Rafale. Hélène Boucher, flying this aircraft, achieved numerous speed records, notably the women's world record for speed over 1000km.
• D-3 for Roland-Garros. Renault is taking the opportunity to unveil its future 100% electric R5 in a Roland Garros version. Renault is the partner of the tennis tournament since last year.

???Investment/Financial Updates

• 吉利控股集团 invests $295M in Aston Martin and become its third shareholder with 17% shareholding. The arrival of the Chinese manufacturer opens access to its technology portfolio, a boost for Aston Martins’ electrification strategy?

• Following a challenging 2022/23 fiscal year, Honda, the second-largest automaker in Japan, unveiled ambitious annual forecasts last week. For 2023/24 Honda is banking on higher production levels and increased sales prices to drive its projected growth. The group hopes to achieve a net profit of €5,4Bn which would be an increase of 15,1% year-on-year.
• In collaboration with the start-up Fixico , the Vietnamese manufacturer VINFAST is launching a digital after-sales infrastructure dedicated to its EVs in Europe.
• Aiways, the Chinese manufacturer is in the midst of restructuring but denies that its future is unclear and wants to reassure on the future of its production despite financial difficulties (cessation of payment of salaries and charges as well as delay in the settlement of suppliers' invoices).

?? What's on next week?

???MON-WED: ECOMOTION WEEK - The EcoMotion Week will welcome many actors of the Smart Mobility industry in Tel-Aviv, coming from the thriving Israelian tech scene and beyond. Among them: Innoviz Technologies , Cognata , Autofleet , Aurora Labs , etc…

???MON-WED: ITS EUROPE CONGRESS - The big European gathering for the ITS ecosystem will take place from Monday to Wednesday in Lisboa. Five key topics this year: Cooperative, Connected and Automated Mobility, New Mobility Services, Freight and Logistics, Digitalisation and the Data Value Chain and Future Traffic Management.

???TUE-THU: THE BATTERY SHOW - Certainly the biggest event related to the battery industry in Europe, The Battery Show Europe will kickstart on Tuesday in Stuttgart. A way to meet battery manufacturers, suppliers, engineers and so on, and interesting keynote speakers from 蜂巢能源科技有限公司 (Andreas Weiglein), PowerCo (VW Group subsidiary, Sebastian Wolf ), Volta Energy Technologies (Dr Jeffrey Chamberlain ), etc…

???WED: BMW i5 REVEAL - D-Day for the Bavarian brand who will introduce the new iteration of its all-electric sedan. Get ready for a big new shiny grille on our roads.

?? THU-SAT: ChangeNOW - It’s all gonna be about sustainability in Paris from Thursday! The ChangeNOW summit will open its doors at the splendid Grand Palais Ephémère, to display the “most innovative solutions” and echo the most “impactful change makers”. Many low-carbon mobility start-ups will be there, with the bigger name being 雷诺 , the only carmaker attending the event.

See you next week and don't forget to share and subscribe to the newsletter!