🔌Su$tainable Mobility, Volume 24
This newsletter aims to separate the signal from the noise for making money in all things sustainable transportation: Electrification, mode shift, active and public transit, and mobility aggregation, across both people and goods movement.
This week we have a Deep Dive on 5 Sustainable Mobility Implications of the Russian Invasion of Ukraine.
Disclaimer: This newsletter represents individual thoughts and not those of any employer. I will always disclose when I have a financial relationship with a company cited.
STARTUP WATCH
🤖 BlueSpace (California, USA): Autonomous vehicle software focused on motion perception
🛸 Drone Future (Belgium): Comprehensive last-mile drone delivery solution
🚐 Fetii (Texas, USA): On-demand group ridehail
📦 Liefergrün (Germany): Sustainable last-mile delivery software
🚦LYT (California, USA): Software for traffic management
🚤 Photon Marine (Oregon, USA): Electric outboard motor system and integrated fleet management software for small boats
🔋Princeton NuEnergy (New Jersey, USA): Lithium-ion battery recycling
QUICK HITS
⚡️California continues to move forward towards some form of mandated vehicle-to-grid by 2030. Utilities and OEMs will both struggle to make the consumer experience as seamless as it needs to be.
🚌 Foxconn has delivered its first electric vehicle: a bus. This is an astute approach by Foxconn to fly under the radar a bit before a subsequent launch into passenger cars.
🚄 California’s high-speed rail project isn’t gaining speed. The inability to cost-effectively pull off infrastructure projects in the US is a genuine impediment to future growth.
♾ Thanks to gravity and battery regen, Australia may have a perpetual motion train. Alas, there’s probably a limited set of use cases where this could work.
🛵 Gogoro has revealed a prototype of the first solid-state, swappable battery. There’s still lots of work to do on the solid-state cost front, but Gogoro continues to punch well above its weight in battery innovation.
🛒 Gorillas drops 10-minute delivery promise, Buyk and Fridge No more go belly up. The bubble may have burst on expectations for the instant delivery market.
🥡 In NYC, Joco pivots hard to food delivery. While it might be nice to put the legal battle with NYC DOT behind them, they’re pivoting when the instant delivery market is struggling.
🚚 New Yorkers are getting paid to narc on idling trucks. An interesting program but one that can be made significantly more effective by digital curb management programs.
🌊 US EPA reaffirms California’s right to regulate auto pollution. It’s not surprising that the Biden Administration overturned a backward decision by the Trump administration, but it’s welcome anyway.
🚛 US EPA proposes new emissions rules on heavy trucks. But no proposed rules on zero emissions. Contrast that with California, which is starting to set targets for zero emissions heavy-duty trucks.
🇳🇱 In the Netherlands, one-third of the population has an e-bike. This is a good country to look to understand how the e-bike market may evolve in other markets.
🤖 US approves new rules allowing robotaxis to drop the steering wheel and pedals. This opens the door for much more form factor innovation.
DEEP DIVE: 5 Sustainable Mobility Implications of the Russian Invasion of Ukraine
The Russian invasion of Ukraine is becoming a pivotal moment in modern history, with the previously unthinkable in Europe and North America happening in a matter of days. As with any pivotal moment, second- and third-order effects will reverberate across the world. Below are 5 potential implications linked to sustainable mobility:
Get ready for EV price hikes. Nickel is used in most of today’s lithium-ion batteries and Russia supplies about 20% of the world’s nickel. Nickel market prices have skyrocketed, with at least a $1,000 increase in costs for an EV. Look for accelerated deployment of LFP batteries as a result.
Get ready for limited EV availability. EVs were already in short supply in some segments before the invasion and expect it to get worse as automakers are forced to curtail production in response to parts shortages linked to Ukraine and Russia. VW, for example, is already sold out of some EVs for all of 2022.
Get ready for EVs to potentially become profitable sooner. Vehicle demand already exceeds supply. With automakers able to pass on EV-related price hikes, EVs may beat ICE vehicles for unit-level profitability in more and more cases this year.
Get ready for higher energy and fuel prices in North America and Europe. North America has been highly dependent on Russian oil; Europe has been highly dependent on Russian gas. There is no easy short-term fix for the error. In the short term, mobility will become more expensive and less sustainable.
For example, get ready for a discussion of increasing ethanol subsidies in the US as a reaction to rising oil prices. America’s ethanol program is a wasteful concession to special interests. Attempts to boost the program may make for a good sound bite, but ultimately run counter to our goals.
Get ready for a breaking point for Renault. Russia represents 18% of the company’s unit sales and a couple hundred million Euros in profit each year, so it has a lot to lose as sanctions mount. Versus its peers, Renault is already on shaky ground: it lost money in 2019 and 2020 while others were making great money. It’s quite a shift versus half a decade ago when Renault (and its partner Nissan) were global EV leaders and the largest carmaking alliance in the world. It’s going to become increasingly difficult for Renault to invest in EVs and sustainable mobility if its always on the defensive.
Alas, these are the things that are likely to happen, not necessarily what should happen. An expansion of e-bike subsidies in Europe and the launch of North America equivalents could be one of the most effective ways of managing for higher prices at the pump, rising vehicle costs, and the need to wean ourselves off of fossil fuels, whether they come from Russia, the US or elsewhere.
Very informative! Good read! Thank you, Alex!