2020 will be remembered as the year of the electric vehicle (EV) revolution. Notwithstanding the unprecedented economic effects of a global pandemic, excitement among investors around opportunities in the EV world has been climbing steadily…
Consequently, a number of new EV players have entered the market this year through special purpose acquisition companies — better known as SPACs — that have no commercial operations but are created solely for raising capital through an initial public offering. Hence, the EV space is getting crowded and not all the players possess sound fundamentals.
Investors should be judicious in picking the best companies to ride the industry’s growth. It is wise to avoid Hyliion Holdings Corp. (HYLN – Get Rating) and Kandi Technologies Group, Inc. (KNDI – Get Rating) at this moment because these companies could struggle to stay afloat due to recent company-specific developments.
HYLN designs, develops, and sells electrified powertrain solutions, particularly electrified powertrain solutions for Class 8 commercial vehicles. It provides battery management systems for hybrid and fully electric vehicle applications. The company recently went public via a SPAC through a merger with a shell company, Tortoise Acquisition (SHLL), in a deal worth over $500 million.
HYLN initially claimed that its technology would improve the fuel efficiency of its trucks by 10% to 30%. However, Bonitas Research characterized the company’s fuel efficiency claim as lie. An external test of HYLN’s technologies by PAM Transportation Services was performed that found only “a small percentage” improvement in fuel efficiency. Moreover, HYLN claims to have over 700 natural gas stations–a claim that has also been challenged. The company might be subject to an SEC investigation.
HYLN has recorded zero revenue to date; it anticipated $1 million of revenue this year. However, the company installed eight hybrid electric units in the third quarter of 2020 for four fleet-based customers. It reported a loss of $0.76 per share compared to the year-ago loss of $0.45 per share. HYLAN company signed a natural gas fueling partnership with American Natural Gas during the quarter that also executed a pre-order agreement to purchase up to 250 Hypertruck ERX vehicles. However, the company’s…
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