Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Axios on your phone

Get breaking news and scoops on the go with the Axios app.

Download for free.

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Shoshana Gordon/Axios

Investors have been falling out of love with electric vehicle startups — particularly the ones that have merged with SPACs.

Why it matters: EV companies were a hot target for SPACs last year as investors saw long-term growth opportunities in the global transition to clean energy.

  • But the mood has changed as incumbent automakers, Ford and GM, have stepped up their plans to become more competitive in the EV market.
  • Growing regulatory scrutiny over SPACs and broader market sentiment shifts are also casting shadows over the sector.

Driving the news: Shares of pre-revenue EV company Lordstown Motors plunged 15% after the Monday announcement that the company needs to raise additional capital — though the stock has recovered throughout the week.

  • On the flip side, shares of Ford have gained 13% since Wednesday, when the company said it expects EVs to make up 40% of its worldwide sales by 2030.
  • Ford's message, in a nutshell: We have the scale, plus manufacturing and engineering know-how, that the startups lack.

The SPAC factor: Entrepreneurs eager to capitalize on the clean energy revolution opted to fast-track pre-revenue EV companies to the public markets through SPAC deals.

By the numbers: Four EV makers that completed a SPAC merger last year — Fisker, Canoo, Lordstown and Nikola — are trading between 72% and 90% lower than their highs.

  • Shares of 19 EV and EV-adjacent companies that have gone public via SPACs have seen their share prices fall about 50% from their highs, according to an Axios analysis of SPAC Research data.
  • Even Tesla is down 16% so far this year.
  • Meanwhile, GM and Ford shares have gained 43% and 61%, respectively.

What they’re saying: The initial hype for EV stocks is similar to what happened during the early 2000s tech boom, Bill Selesky of Argus Research tells Axios.

  • Like pre-revenue tech companies then, these new EV makers have warned investors that it could take years to grow — but investors are showing more skepticism, and less patience.
  • Dan Ives at Wedbush notes that SPACs have also added more EV companies to the public markets, creating an "arms-race" feel.
  • "As appetite for risk has declined in this environment, no sector besides tech has been hit as hard as the EV landscape," Ives says.

Reality check: The chip shortage and concerns of rising inflation and subsequent rate hikes have pushed many investors to risk-off mode.

Our thought bubble: New EV companies are motivated by the idea of being the next Tesla, while investors want to find the next Tesla.

  • But history is littered with examples of car companies that have failed — even Tesla has come close many times.

The bottom line: Incumbent carmakers will likely end up winning a large portion of the EV market, while smaller companies get scooped up or fold. 

  • Some investors will get burned along the way. But the world will ultimately have a lot of EVs.

Go deeper

Ford says it will invest $30 billion in electric vehicles by 2025

Ford's new electric F-150 Lightning outside of its headquarters in Dearborn, Michigan on May 19. Photo: Jeff Kowalsky/AFP via Getty Images

Ford announced Wednesday plans to invest $30 billion in vehicle electrification efforts by 2025, and the company said it anticipates that 40% of its global sales by 2030 will be fully electric vehicles, per a news release.

Why it matters: Ford CEO Jim Farley said the new initiative — called "Ford+" — is the company's largest opportunity for growth since "Henry Ford started to scale the Model T," signaling just how lucrative Ford leaders think the electric vehicle market will become.

Dan Primack, author of Pro Rata
May 26, 2021 - Economy & Business

Tech startups going public has become the rule, not the exception

Illustration: Aïda Amer/Axios

Did you read that report about the tech unicorn that's thinking about going public? No, not that one. The other one. No, the other one.

Between the lines: A large percentage of VC-backed companies with at least four years and $50 million of annualized revenue under their belts are speaking with bankers about going public. It's the rule, not the exception.

Updated 21 mins ago - Science

NTSB probes deadly Alabama crash as storms lash Southeast and Midwest

Flash-flooding in Bloomington, Indiana, on Saturday. Photo: Jeremy Hogan/SOPA Images/LightRocket via Getty Images

The National Transportation Safety Board announced Sunday that it's sent a team to Alabama to help investigate a fiery multi-vehicle crash that killed 10 people, including nine children.

The big picture: Saturday's crash, south of Montgomery, occurred amid a tropical depression that left 13 people dead in Alabama as it triggered flash floods and spawned tornadoes that razed "dozens of homes" in the Southeast over the weekend, per AP. Parts of the Midwest, including Indiana and Chicago, where a tornado struck late Sunday.