When electric busmaker Proterra filed for Chapter 11 bankruptcy in August 2023, some analysts were sceptical that its financial woes presaged a wider issue for electrifying commercial vehicles (CVs). Since then, other start-ups such as Volta Trucks, Arrival, and Tevva have all either faced insolvency crises or entered administration.
The reasons are diverse, but most were symptoms of one main issue: the current global economic situation makes it difficult to produce vehicles profitably, particularly for start-ups. This was cited explicitly by Tevva in a May 2024 statement on its liquidity issues. Indeed, despite the British company Arrival’s decision in October 2022 to refocus on the US market specifically because of healthy Inflation Reduction Act tax incentives, it was still delisted from the Nasdaq in February 2024 after quickly burning through its capital.
New manufacturing methods could resolve some of the challenges, but the problem goes deeper. The economic pressures of establishing and maintaining eCV fleets, particularly the quality and suitability of charging infrastructure, threaten to delay customers from purchasing them in the first place. If manufacturers are to stand a chance at building a more stable market, the wider ecosystem must first offer a compelling business case for transitioning from diesel.
