Big money is suddenly lifting startup hopes

It's been at least a century since so many startups have tried to crack the code and enter the auto industry.

The arrival of viable electric powertrains, combined with consumers who are more accepting of the limitations of electric vehicles, has sparked unprecedented investment in new would-be automakers. And there has never been a better time for EV startups.

Proposed fuel economy rules announced this month by the Biden administration could make it far easier for new companies, such as Rivian, to reach profitability sooner. The credits Rivian would earn from sales of its electric pickup, SUV and commercial van could be worth hundreds of millions of dollars from competing legacy automakers that rely on gasoline- and diesel-powered pickups and SUVs for the bulk of their profits.

Selling EV credits was a substantial help in keeping Tesla alive during its lean years. And the race to become the next Tesla is on.

But like a century ago, some of the new auto companies may not get their first vehicles to market before running into technical troubles or running out of cash.

Although electric powertrains greatly simplify product development — since there are no tailpipe emissions standards to meet, for example — and greatly reduce the number of moving parts, EV makers have no easy path to follow. EVs still have to meet federal crash and safety standards. And beyond that, there is no template for engineering a safe, reliable and durable battery pack.

And even with nearly unlimited funds, it can prove difficult to bring world-class vehicles to market. Rivian, which has raised nearly $11 billion and is backed by Amazon, Ford Motor Co. and several large investment firms, is nine months late delivering its first consumer vehicle, the R1T electric pickup.

Other obstructions — such as the global microchip shortage, the lingering effects of the pandemic and some fatigue from Wall Street investors — are also aggravating the efforts of these new companies to get cranking.

And the competition is not standing still. As more legacy automakers bring EVs to market, the new kids on the block may find their reason for being undermined by established companies that have learned to move faster.

One thing is certain: The startups have had no shortage of drama, be it executive churn, government investigations involving financial activities, cash woes or other maladies. Starting a car company and running it profitably has never been an easy job — not a century ago, not in 2021.

Tesla is finally making money on vehicles after more than a decade. Right now, everyone is trying to figure out who's next. Here is a brief summary of the startups that appear to be furthest along and closest to producing their vehicles.

Bollinger Motors: Engineers work as venture seeks funds

The suburban Detroit truck startup is at an impasse, lacking two major pieces of the puzzle to move forward: money and an assembly plant to produce its vehicles — or at least a deal with a contract manufacturer to build them. But Bollinger engineers continue to develop the venture's proposed boxy, four-wheel-drive electric pickup, SUV and commercial chassis cab models in their Oak Park, Mich., technical center as the company searches for long-term financing.

Bollinger is the only startup working to develop a consumer-friendly, 8,500-plus-pound heavy-duty EV. But target dates have come and gone for when Bollinger was going to name a manufacturing partner after deciding not to build the vehicles in-house. And no delivery dates are shown on the company's website.

While the boxy designs of the B1 and B2 have generated plenty of interest, GMC's Hummer electric pickup and Rivian's R1T are now on track to reach the market first. The next six months could be crucial. As the market fills with electric trucks, Bollinger's challenge will become increasingly difficult.

Canoo: Building Okla. assembly plant, with more vehicles to come

Bankrolled by cash from a special-purpose acquisition company financial maneuver, the startup aims for a late 2022 debut of its futuristic-looking, seven-seat activity vehicle, which appears to be a mix of an SUV, a minivan and an RV.

In June, the company announced it will build an assembly plant in Pryor, Okla., that is expected to be operational by late 2023. The plant will contain a paint shop, body assembly equipment and other manufacturing equipment and employ 2,000 workers, according to a Reuters report. Until the plant comes online, Canoo will use a European contract manufacturer, VDL Nedcar in the Netherlands, to assemble the as-yet-unnamed vehicle.

Two other vehicles are in development: a pickup and a delivery vehicle.

Meanwhile, there's been some executive churn. In April, the venture's chairman and largest investor, Tony Aquila, took over as CEO, replacing co-founder Ulrich Kranz.

Electric Last Mile Solutions: Now hiring plant workers

Plans to manufacture an electric delivery van based on a Chinese design from Wuling Motors remain on track for a third-quarter production start, the company says. Initial funding for the project is coming from a special-purpose acquisition company deal. Electric Last Mile Solutions raised $379 million late last year, and the company has signed a distributor, Randy Marion Auto Group of Mooresville, N.C., to handle some fleet sales.

The vans will be built in the former AM General plant in Mishawaka, Ind., which once was owned by failed Chinese startup Seres. Electric Last Mile has begun rehiring the experienced former AM General work force that built Hummer and Mercedes vehicles before the company exited the contract assembly business two years ago. Pilot production is scheduled to begin late this summer after crash testing is complete. The vans have a range of about 150 miles per charge and are expected to cost just over $25,000 after incentives.

Faraday Future: First vehicle promised in 12 months

The Los Angeles startup that has struggled for years to bring a product to market received a shot in the arm in late July when it went public on the Nasdaq through a special-purpose deal with Property Solutions Acquisition Corp. Faraday said it now has $1 billion in financing that will enable it to deliver its first FF 91 vehicle in 12 months.

The EV startup said after the deal that all 300 of its limited FF 91 Futurist Alliance Edition vehicles have been reserved through $5,000 deposits. Faraday has not set a price for the launch vehicle or for future trims of the SUV-style EV. In past iterations of the FF 91, Faraday estimated that the price tag would come in well above $100,000.

After the launch edition, Faraday intends to make the FF 91 Futurist model and is now taking $1,500 deposits. The base FF 91 is not yet available to reserve. Faraday has a factory in the Central Valley community of Hanford, Calif., which once housed a Pirelli tire plant.

Fisker Inc.: Ocean expected to go on sale in late 2022

After inking a deal last fall with Magna Steyr to build the Ocean electric midsize crossover in Austria, and banking more than $1 billion from a special-purpose deal, it appears that all systems are go for Henrik Fisker's second effort to launch a car company. Fisker plans to show a production-intent Ocean in November at the Los Angeles Auto Show. Deliveries are expected to begin in late 2022, with prices starting at $37,499 before tax incentives. Fisker claims more than 17,000 deposits have been placed on the handsome crossover.

Details of Fisker's planned second vehicle, called Project PEAR (Personal Electric Automotive Revolution), remain unclear. Fisker has promised a breakthrough vehicle — much like the original Austin Mini, Volkswagen Beetle or Ford Mustang — and that car could be built by Foxconn at a plant in Wisconsin with a price tag projected to be less than $30,000. During a visit to Automotive News, Henrik Fisker said the company has more than $900 million in the bank, and he plans to sell vehicles directly to consumers, not through dealerships.

Lordstown Motors: Troubles behind, capital ahead

U.S. Securities and Exchange Commission investigations, shareholder lawsuits, executive churn and a rapidly dwindling bank account have overshadowed just about everything this year for the troubled EV truck startup.

In late July, Lordstown received a potential $400 million cash injection from a hedge fund — but with a catch. It would come from a stock sale over the next three years. Wall Street financial gurus are not convinced that Lordstown has enough time left to get its planned four-motor Endurance pickup into production before financial problems sink the venture.

At the same time, the competitive landscape has changed since Lordstown plotted its course. Ford has announced that its upcoming battery-electric F-150 Lighting pickup will have a version that starts at about $12,000 less than Lordstown's target for the Endurance.

But if the Endurance does make production, it will usher in a new technology: wheel hub motors. Placing the motors in the hubs greatly reduces a vehicle's moving parts. Lordstown licensed the technology from Elaphe, a Slovenian company.

Lucid Motors: A special-purpose acquisition deal rains cash

The venture merged with the Churchill Capital Corp IV special-purpose acquisition company and started trading on the Nasdaq late last month. That move brings billions of dollars to Lucid to launch the Air sedan this year after several delays.

The Newark, Calif., startup says it is now in the final stages of test production at its new Arizona factory and will deliver the first of the launch models of the Air, the $169,000 Dream Edition, in the second half of this year. The public listing makes it significantly more likely that Lucid will finally deliver some cars.

Lucid Group CEO Peter Rawlinson, who previously was the chief engineer for the Tesla Model S, said Lucid is on track to meet its projected deliveries for the next two years. It will first deliver its most expensive trims but eventually offer a $77,400 version called the Air Pure. The company has not posted shipping costs.

Two other Air trims are planned: the $95,000 Air Touring and the $139,000 Grand Touring. Competitors include the Model S, the new Mercedes-Benz EQS electric sedan and, according to Rawlinson, gasoline-powered high-end sedans such as the Mercedes S-Class. Lucid will sell direct to customers online. The Dream Edition has sold out its planned limited run of 500 vehicles. Total reservations for the Air, Lucid said, are 11,000.

Lucid also is developing an electric SUV, currently called Project Gravity, that it plans to build in late 2023. Rawlinson has said he also wants to make a Tesla Model 3 rival by 2025.

Rivian: Amazon delivery vans, R1T test pickups in production

Production of Rivian delivery vans for Amazon is underway at a slow pace, and test versions of the production-intent R1T electric pickup also are rolling down the line at the startup's plant in Normal, Ill. Rivian has received funding from Amazon, Ford Motor Co., Cox Enterprises and several large investment firms, and expectations are high that the manufacturer will follow in Tesla's footsteps.

The R1T Launch Edition is scheduled to arrive in September, about nine months later than planned. After that, Rivian will begin production of the R1S SUV for a spring launch. The company is on tap to produce 10,000 Amazon vans in 2022, the first of a 100,000 vehicle order that runs through 2030.

At least six other Rivian EVs are planned, along with the start of international sales and the rollout of a charging network in national parks and other off-road-friendly venues.

Rivian is expected to go public sometime this year with a potential valuation of $70 billion. The company is looking at sites in the United Kingdom for a European plant.

Workhorse: Now it's up to Dauch to get production going

The Cincinnati company added some star power to its executive ranks this month when former Delphi Technologies chief Richard Dauch took over as CEO. Dauch's task will be getting Workhorse's electric delivery vans into high-volume production. Workhorse had built just 38 units of its large C-Series electric delivery van through May. The company's first-quarter sales totaled just $521,000; losses were in the millions.

But Dauch takes the helm at Workhorse knowing about high volume manufacturing and the latest EV technology. The company is banking on its C1000 van, with a 100-mile range, to generate cash and profits. Other vehicles and projects in the pipeline include the smaller C650 van, a delivery drone called Horsefly that is designed to work in tandem with the company's vans, and a commercial delivery vehicle app designed to efficiently manage EV fleets.

VinFast Global: Living up to the name as models roll out

Vietnam's VinFast Global, a unit of Vingroup, the Southeast Asian nation's biggest conglomerate, just named a German CEO to bring the little-known brand to the U.S. and Europe.

VinFast, established only in 2017 as Vietnam's first homegrown auto brand, has a manufacturing complex in the country's north, where it churns out a range of automobiles, scooters and buses.

It has so far operated as its name implies — fast. It built its factory in 12 months and launched its first three models within 18 months of completing the plant. And just 18 months after launching its first gasoline nameplate in 2019, the venture achieved No. 1 market share in the home market segments in which it competes.

Now, according to the VinFast website, it plans to follow the industry trend from internal combustion to electric by launching six EVs, starting with the VF e34 compact crossover this year. That entry will be followed by global deliveries of two larger crossovers in 2022, the VF e35 and VF e36. And according to its plans, VinFast will enter what it calls Phase 3: Go Global in 2022, with showrooms in key global markets.

VinFast says its factory is running with 1,200 robots and has the capacity to build 250,000 vehicles a year. It intends to launch sales in Germany, France, the Netherlands and the U.S.

The company already has R&D centers in Germany, the U.S. and Australia.

VinFast said in April that to help fund the expansion, it is considering an initial public offering. The announcement came in response to market rumors that it might be planning a U.S. listing.

VinFast took another step forward this summer by hiring Opel CEO Michael Lohscheller to serve as its CEO and spearhead the push to become a "global smart electric car company." Opel had announced in July that Lohscheller would be replaced at the Stellantis brand on Sept. 1.

"I have always been attracted by new challenges," Lohscheller, a veteran of Mitsubishi, Volkswagen and Opel, said in the statement announcing his appointment. "When the opportunity came to join VinFast, I was immediately attracted because of the growth opportunities."