Tesla a Bright Spot in Still Dim, but Improving Electric Car Industry

Photo of Nissan Leaf S courtesy of evworld.com

Photo of Nissan Leaf S courtesy of evworld.com

Anyone watching the still slow but improving progress of the electric car industry may have seen the Bloomberg Businessweek story on the “Tale of Two Electric Car Makers: Tesla Soars, Fisker Flops” (http://www.businessweek.com/articles/2013-05-08/a-tale-of-two-electric-car-makers-tesla-soars-fisker-flops). Tesla Motors not only produced a profit in the first quarter, as advertized, but also increased its guidance on sales for the year, from 20,000 to 21,000 cars. TSLA revenues were up 83 percent year-over-year to $562 million and the stock is soaring (see below).

While the article outlines supply chain and battery issues and other “kinks in its processes” Tesla needs to iron out, their stock is soaring and the outlook looks good. The contrast was provided by Anaheim, CA-based Fisker Automotive, which is laying off employees and hiring bankruptcy consultants, the article reports. Another electric car maker, Los Angeles-based CODA Automotive, recently filed for bankruptcy protection and announced it was “focusing its business strategy on the growing energy storage market,” according to a company filing.

For more positive electric car news, the BBC posted an article this week on the Nissan Leaf (http://www.bbc.com/autos/story/20130509-leaf-charges-into-mid-life) as it “charges through mid-life.” The Leaf, billed as “the first truly global mass-produced electric vehicle,” now includes the Leaf S, a lower cost model “designed to lower the barrier of entry to EV ownership.” One of the cost cutting moves was to move its assembly line from Japan to another Nissan factory in Smyrna, TE.

The BBC put the Leaf through its paces and managed to get 75 miles from a full charge, right about in line with Nissan estimates. Competitors mentioned in the article include the Toyota Prius PH-V and Ford C-Max Energi, both plug-in hybrids.

If anyone out there is charged up about the electric vehicle market, and knows of a small cap stock play in this market, please let us know. Meanwhile, we’ve been following a few small caps, plus Tesla to see how their stock is moving. We’ve also added a new company, Car Charging Group, to our list.

Palo Alto, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com/) manufactures the Tesla Roadster, the Model S and other electric vehicles and electric powertrain  components. It’s way too large for our small cap blog focus, but just as a reference, the last time we looked at Tesla last February 20 it was trading at $38.90 with a market cap of $4.4 billion. As we mentioned, TSLA stock has been on a huge roll. It closed May 15 at $84.84, up $1.60 for the day. Its 52-week trading range is now $25.52-$97.12.

Santa Rosa, CA-based ZAP (OTC: ZAAP.OB, http://www.zapworld.com/) makes a variety of all-electric vehicles including trucks, motorcycles, shuttle buses and sedans and was formerly known as ZAPWORLD.COM. When we last checked on Feb. 20 its stock closed at $0.08 with a market cap of $24. ZAAP closed May 15 at $0.14, up 3 cents for the day, with a market cap of $42 million. Its 52-week trading range is $0.06-$0.27.

San Diego-based Maxwell Technologies Inc. (Nasdaq: MXWL, http://www.maxwell.com/) was formerly known as Maxwell Laboratories. The company manufactures ultracapacitors that are energy storage devices and power delivery systems for use in transportation, automotive, IT and industrial electronics.  MXWL closed back on Feb. 20 at $10.01 with a market cap of $292 million. It closed May 15 at $6.36, up 11 cents for the day, with a market cap of $185 million. Its 52-week trading range is now $4.90-$11.08.

Miami Beach-based Car Charging Group (OTCQB: CCGI, http://www.carcharging.com/) caught our eye with the announcement March 12 that it was acquiring EVPass, a company building destination charging networks for EV charging. CCGI  is also in the business of building charging station networks and has been busy making more acquisitions. Earlier this month, CCGI announced it had acquired 350Green LLC. CCGI closed May 15 at $1.34, up 4 cents for the day, with a market cap of $70.8 million. Its 52-week trading range is $0.60-$2.

This Big, Bad, 949-Horsepower, Million Dollar-Monster Is a Hybrid

If you are a fan of electric and particularly hybrid vehicles, and more people apparently are every day, you have to like the spectacular news coming out of Ferrari and the recent report from Autodata Corp., a research firm.

Photo courtesy of automonthly.blogspot.pt

Photo courtesy of automonthly.blogspot.pt

Let’s start with Ferrari, which unveiled its La Ferrari supercar in Geneva in March. Yes, Ferrari’s “biggest and baddest” car these days is a hybrid, according to the Los Angeles Times (http://www.latimes.com/business/autos/la-fi-hy-autos-hybrid-20130330,0,2070748.story). It’s a V-12, “949-horsepower, million-dollar monster” that also has two electric motors and recharges its batteries with regenerative braking and the engine’s excess torque.

Who knows how many La Ferraris will actually sell, but the good news from Autodata is that hybrids are certainly selling faster than ever. Hybrid sales in the first two months of 2013 are up 32 percent over the same period last year, according to the Times report.

While overall marketshare is still low, about 4 percent, the fact that Ferrari is now in the hybrid market underscores the fact that that hybrid technology “is being taken seriously by virtually all the automakers,” noted analysts in the Times, including Nissan which introduced a new hybrid version of the Pathfinder at the New York Auto Show in February after dropping out of the hybrid market a few years ago. Overall, hybrids deliver 40 percent better fuel economy than conventional gasoline-powered cousins of the same model.

As we have noted earlier, the Prius is now the best-selling car in California, the nation’s largest auto market, and they’re apparently reliable. Not only are they now being used as taxicabs, which take a notorious beating, but the Times story notes that Toyota reports that 90 percent of all Prius cars it sold since introducing the model are still on the road. 

The story includes a note that one large Houston Ford dealership reports that its sales of hybrids are up 400 percent from a year ago. Nationally, Ford reports it’s selling 3,000-4,000 of its C-Max hatchback hybrid, a direct competitor to the Prius V station wagon, according to the Times.

While Toyota’s hold on the hybrid market has dropped from 73 percent to 63 percent, thanks to competitors like Ford, the overall market size is much bigger, meaning “both automakers are sharing a bigger pie,” noted the Times.

Unfortunately, hybrid vehicles are difficult to link directly to small cap stocks. So we’ve taken some liberties and included companies like Tesla Motors, which makes electric vehicles and is a mid-cap, and Axion Power International, which makes a battery used in a hybrid 18-wheeler made by a private company called ePower.

Palo Alto, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com/) manufactures the Tesla Roadster, the Model S and other electric vehicles and electric powertrain  components. The last time we looked at Tesla last on Feb. 20 it closed at $38.90 with a market cap of $4.4 billion. But it came out with promising news this week, saying car sales nearly doubled in the first quarter of 2013 compared to the fourth quarter, and expects to turn a profit. TSLA closed April 2 at $44.34, up 41 cents, with a market cap of $5.1 billion. Its 52-week range is now $25.52-$46.68.

New Castle, PA-based Axion Power International (OTC: AXPW, http://www.axionpower.com/) has developed a specialty PbC battery technology designed for micro- and mild-hybrids, as well as an advanced energy storage device. A private Pennsylvania-based company, ePower, is developing 18-wheeler hybrid trucks with the Axion PbC batteries. Axion closed April 2 at 26 cents, down 1 cent for othe day, with a market cap of $30 million. Its 52-week trading range is $0.20-$0.47.

Santa Rosa, CA-based ZAP (OTC: ZAAP.OB, http://www.zapworld.com/) makes a variety of all-electric vehicles including trucks, motorcycles, shuttle buses and sedans and was formerly known as ZAPWORLD.COM. Most of its business at this point is with government or military customers. When we last checked on Feb. 20 its stock closed at $0.08 with a market cap of $24 million. It closed April 2 at $0.17, up 2 cents on the day with a market cap of $51 million. Its 52-week trading range is $0.06-$0.27.

San Diego-based Maxwell Technologies Inc. (Nasdaq: MXWL, http://www.maxwell.com/) was formerly known as Maxwell Laboratories. The company manufactures ultracapacitors that are energy storage devices and power delivery systems for use in transportation, automotive, IT and industrial electronics.  MXWL closed Feb. 20 at $10.01 with a market cap of $292 million. It closed April 2 at $4.98, down 17 cents for the day, with a market cap of $145 million. Its 52-week trading range is $4.92-$18.33.

Does the ‘Car of the Future’ Have a Future? Tesla Says Yes

Does the “car of the future” have a future? That’s the question Time magazine asks as the end of its recent story on electric cars that ran under the headline “Electric-Vehicle Acid Test” (http://www.time.com/time/magazine/article/0,9171,2134523,00.html). While more and more battery-powered and hybrid vehicles are being introduced and prices continue to be slashed, sales continue to disappoint. Nonetheless, Cadillac, Fiat, Ford and Honda have announced that they will launch new all-electric vehicles this year.

Auto analysts say the biggest hurdle electric cars face is range, according to Time. Pure electric cars like the Nissan

Photo courtesy of Motortrend.com

Photo courtesy of Motortrend.com

Leaf list a range of about 80 miles before it needs a recharge, which can take hours. The Tesla Model S electric car boasts a range of 265 miles, although that’s currently the source of much debate, based on a kerfuffle kicked up by New York Times reporter John Broder’s test drive (http://www.nytimes.com/2013/02/10/automobiles/stalled-on-the-ev-highway.html?pagewanted=all&_r=0&pagewanted=print). When Broder reported that the Model S failed to live up to the range claims,  among other issues, Tesla founder Elon Musk took offense and offered other reporters a similar test drive to prove Broder was misleading readers and failed to fully recharge the batteries. Incidentally, Tesla reported its fourth quarter/year end results Feb. 20 and reconfirmed its guidance that 20,000 Model S vehicles will be sold this year and, in what was a new outlook, said the company will be profitable in the first quarter of 2013, not later in the year as they had guided investors earlier.

There’s little debate the fact that electric and hybrid vehicle prices are being slashed considerably. The lease price of the Nissan Leaf, which was about $449 per month in 2010, is now $139 monthly. Time reports that General Motors executives say the cost of next year’s Chevrolet Volt “will be thousands of dollars cheaper than last year’s.”

So how does a small cap investor play the electric and hybrid vehicle market? Here are a few randomly chosen options:

Palo Alto, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com/) manufactures the Tesla Roadster, the Model S and other electric vehicles and electric powertrain  components. It’s too large for our focus, but just as a reference, the last time we looked at Tesla last September 19, 2012 it was trading at $31.05 with a  market cap of $3.3 billion. It closed Feb. 20 at $38.90, down $0.38 for the day with a market cap of $4.4 billion. Its 52-week trading range is now $25.52-$40.

Santa Rosa, CA-based ZAP (OTC: ZAAP.OB, http://www.zapworld.com/) makes a variety of all-electric vehicles including trucks, motorcycles, shuttle buses and sedans and was formerly known as ZAPWORLD.COM. Most of its business at this point is with government or military customers. Its stock, which traded for 20 cents last March 13, 2012 with a market cap of about $45 million, closed Feb. 20 at $0.08, no change on the day. Its market cap is now $24 million and 52-week trading range is $0.06-$0.21.

San Diego-based Maxwell Technologies Inc. (Nasdaq: MXWL, http://www.maxwell.com/) was formerly known as Maxwell Laboratories. The company manufactures ultracapacitors that are energy storage devices and power delivery systems for use in transportation, automotive, IT and industrial electronics.  MXWL closed back on March 13, 2012 at $18.69 with a market cap of $522 million. MXWL closed Feb. 20 at $10.01, down 48 cents for the day. Its market cap is now $292 million.

All-Electric Coda Off and Running, with Bevy of Small Caps in Pursuit

What started out five years ago in an airport hangar in Southern California officially became an all-electric car company this week when the first Coda sedans came off the assembly lines and on to the streets, according to the San Jose Mercury News (http://www.mercurynews.com/ci_20156808?IADID=Search-www.mercurynews.com-www.mercurynews.com).

Privately-held Coda Automotive Inc. is dedicated to creating “cars that do not spoil the Earth, drain the treasury or hurt

Coda sedan photo courtesy of matternetwork.com

the health of our children,” according to a quote in the story attributed to Mac Heller, Coda’s executive chairman.

Coda (www.codaautomotive.com) is headquartered in Santa Monica, assembles the cars in Benecia, CA, a city on the bay east of San Francisco, from parts and a battery system made in China. The story suggests Coda is expected to make about 5,000 cars this year. A typical four-door sells for about $37,500 “but qualifies for a $7,500 federal tax credit,” according to the story. The battery pack, produced by a joint venture of Coda and China-based Lishen Power Battery, provides a range of 125 miles per charge, notes Wikipedia.

According to a 2010 Wheels post in the New York Times, Coda has plans to build a battery plant in Ohio to manufacture lithium ion batteries, pending federal funding (http://wheels.blogs.nytimes.com/2010/05/25/coda-to-build-batteries-in-ohioif-the-feds-help/). Given the difficulties with Solyndra, we don’t know if those plans still stand.

The progress of Coda has to be good news for the far flung world of electric vehicle- and electric energy-related stocks. There are many up and coming names to choose from, particularly if you believe this type of alternative energy vehicle will be an important part of our transporation future. These are all picked randomly, however, so due diligence is required.

Santa Rosa, CA-based ZAP (OTC: ZAAP.OB, http://www.zapworld.com) makes a variety of all-electric vehicles including trucks, motorcycles, shuttle buses and sedans and was formerly known as ZAPWORLD.COM. Most of its business at this point is with government or military customers. Its stock has been on a gradual downturn since it sold for 90 cents about a year ago. It closed at 20 cents March 13. Market cap is $45.25 million.

Walthan, MA-based A123 Systems (Nasdaq: AONE, http://www.a123systems.com) makes lithium ion batteries based on its proprietary Nanophosphate technology. It stock was a high flier back in the fall of 2009 when it traded for about $26 but has come down considerably. Its 52-week range is now $8.08-$1.51. At the close of market March 13 the stock was trading for $1.69, up 6 cents on the day. 

Austin, TX-based Valence Technology Inc. (Nasdaq: VLNC, http://www.valence.com) manufacturers energy systems based on another phosphate-based lithium ion technology. Its products are used in a variety of applications in addition to all-electric vehicles, such as wheelchairs, robotics and remote power devices. Back in the summer of 2008 its stock traded for nearly $5 but like some of the other battery makers, it has dropped in value although it continues to trade actively, nearly 350,000 shares a day. Its current 52-week range is $1.67-$.70. VLNC stock closed March 13 at 88 cents, up 1 cent on the day. Market cap is $150 million.

San Diego-based Maxwell Technologies Inc. (Nasdaq: MXWL, http://www.maxwell.com) was formerly known as Maxwell Laboratories. The company manufactures ultracapacitors that are energy storage devices and power delivery systems for use in transportation, automotive, IT and industrial electronics, as well as microelectronic products including single board computers and high-density memory and power modules for satellites and spacecraft applications. Its stock has been on the upswing since December 2008 when it bottomed at $4.52. Its now trading near the top of its 52-week range of $13.78-$21.49. MXWL closed March 13 at $18.69, up 39 cents. Market cap is $522 million.

San Carlos, CA-based Tesla Motors (Nasdaq: TSLA, http://www.teslamotors.com/) manufactures the Tesla Roadster and other electric vehicles and electric powertrain  components. Its market cap of $3.8 billion actually puts it out of our smallcap focus, but it certainly should be included in even a brief survey of new automotive technologies. Its stock hit a 52-week high of $36.29 March 12, despite several online reports of its huge (50 percent as a percentage of float) short interest.  That puts the stock up more than 30 percent in the past five months. It trades very actively, more than 1 million shares a day.\

Another stock to look for soon is Kansas City, MO-based Smith Electric Vehicles, a company that started in the UK and has developed a respected global brand for all-electric trucks, vans and step vans including the Newton and Edison that are used by many companies including FedEx. Smith filed for an IPO last November, and you can find its prospectus here (http://sec.gov/Archives/edgar/data/1455900/000104746911009328/a2206090zs-1.htm).