The irrational exuberance of the electric vehicle bubble is reaching its denouement, as legacy automakers are backing off of their previously ambitious EV sales and production goals, proposed new EV manufacturing plants are being suspended, and lithium battery manufacturing operations are laying off workers.
There is an almost predictable storyline in how these ventures have played out, which is reminiscent of the dot-com bubble of a quarter-century ago, except that the dot-com bubble wasn’t suffused in eco-virtuousness nor did the companies of its era receive such heavy public subsidization before going bust.
The typical boom-to-bust storyline of companies in the EV-era starts with the much-hyped announcement of a “transformational” new manufacturing operation that will be built, bringing hundreds (or thousands) of environmentally responsible jobs, generously funded with federal and state incentive dollars, to produce something that will satisfy the imminent demand for a product (EVs) that actually has no history of consumer demand.
Don't worry honey, you'll never have to do this.
Politicians then proudly pose for photo ops with the enviro-hustlers to whom they are handing out tax dollars. The company also goes public, and despite a lack of profit or meaningful revenue, its stock price soars. As product demand fails to develop, the company continues to produce press releases promising fabulous things to come, which credulous media sources breathlessly republish as news. But the lack of revenue and cash flow ultimately catch up with the company; promised expansions are canceled; the stock price collapses; and the story ends with the promised plant either closing or never getting built in the first place.
Though there are numerous such examples, and there will be plenty more as the implosion of the EV bubble intensifies, the story of an Australian company named Tritium that manufactures -- or perhaps I should say, “manufactured” -- EV charging stations is a textbook example. Tritium expected there to be rapidly increasing demand for its high-speed EV charging equipment due to the inevitability of the “EV transition” that was being hyped by media and compelled by politicians. In 2018, Tritium received Department of Energy funding to develop a high-speed charging system that could connect to the grid.
It was in 2022 that the pace of the Tritium story arc accelerated, and the entire bubble cycle described above played out in just over two years. In February of that year, there was the triumphant announcement that Tritium was building a plant just outside of Nashville to manufacture high-speed EV chargers. Local media reported on the hundreds of jobs being created, while Tritium’s CEO met for a photo-op with president Biden. National media slobbered all over this story too, as it provided confirmation to their climatist belief that transitioning to a carbon-free, net-zero economy would produce abundant “green” jobs. This is what the Washington Post had to say in February 2022:
President Biden on Tuesday highlighted the decision of an Australian electric vehicle charging company to build its first U.S. manufacturing facility in Tennessee as he held a White House event focused on his vision for “electrifying” transportation and supporting manufacturing jobs. The facility, to be built by Tritium, is expected to eventually produce as many as 30,000 electric vehicle chargers a year and create 500 local jobs, Biden said, appearing alongside the company’s chief executive, Jane Hunter.
Of course, the state of Tennessee was also throwing taxpayer money at Tritium to lure the company to the state. Also in early 2022, Tritium merged with an entity named “Decarbonization Plus Acquisition Corporation II” for the purpose of going public. Following the IPO, Tritium’s stock soared, reaching a market capitalization exceeding $2 billion. Spoiler alert – Tritium’s stock is now worthless. It is worth emphasizing that “conservative” Republican politicians in the red state of Tennessee threw taxpayer money at a company employing the word “decarbonization” in its capital-raising efforts.
Tritium’s taxpayer-subsidized plant opened in August 2022, with more fawning press coverage touting how Tritium, “is investing heavily in the US, basing its spending on a forecast of 35 million battery-electric vehicles in use in the country by 2030 (compared to 2.6 million plug-ins as of April 2022).” The national media continued to give Tritium a tongue bath, with stories such as this Time Magazine piece from May 2023 hyping Tritium, and how “car rental giant Hertz’s transition to electric vehicles” would rely on Tritium technology. As we have documented here at The Pipeline, Hertz's transition to electric vehicles was a debacle that resulted in severe financial losses, a collapse in Hertz’s stock price, a humiliating retreat from the EV “transition,” and finally the removal of Hertz’s incompetent, enviro-globalist CEO before he could do any more damage.
Oops.
Meanwhile, the financial performance of Tritium was beyond catastrophic. At its fiscal year end at 6/30/2023, Tritium had a loss of $118 million against revenue of just $184 million. The quarterly reports preceding that were just as bad, causing Tritium’s stock price to start collapsing. Even then the EV-loving financial press still couldn’t stop promoting Tritium. This headline was in Yahoo Finance in September 2023: “Tritium (DCFC) Loses -67.48% in 4 Weeks, Here's Why a Trend Reversal May be Around the Corner.”
The gullible appropriators in Tennessee state government apparently couldn’t read financial statements, or the writing on the wall, with the announcement in February 2024 that $10.5 million more of taxpayer money was being handed to Tritium to deploy a few dozen fast chargers across the state. But by then Tritium was already a zombie company. On April 22, news broke that the company was insolvent and seeking buyers. Despite a 1-for-200 reverse stock split in March for the purpose of keeping its stock listed on NASDAQ, Tritium has been delisted.
This development was not sudden, as Tritium's stock price had effectively collapsed between August and October 2023, falling from the $300 mark to about $40 by late October. For most of March of 2024 it had been trading below the $20 level.
No buyers were to be found, so the future of Tritium’s plant and employees will be left to those mopping up the damage. Perhaps the gullible Tennessee state officials who kept throwing money at Tritium can offer some of its “green” economic incentive funds to help these suddenly unemployed victims of a “clean energy” scam that was funded by the state of Tennessee and promoted by all the usual marks.
The post EVs Enter the Doom Loop first appeared on The Pipeline.