More California electric vehicles are coming
Startup SF Motors has manufacturing expertise, deep pockets
The latest electric vehicle Silicon Valley startup held its coming-out party recently to introduce two crossover sport utility vehicles. Another EV player? Yes. But this one comes with some unusual twists.
The company, SF Motors, already has procured two manufacturing plants — one in Indiana, one in China. Its primary investor, Sokon, is a well-established, deep-pocketed, decades-old auto parts and vehicle maker in Chongqing, run by the father of SF Motors founder John Zhang.
And SF Motors will design and manufacture its own batteries, including the individual battery cell cylinders themselves, with technology developed by Martin Eberhard, its chief scientist and Tesla’s founder.
Two prototype vehicles were shown, but few facts about the cars were revealed. They will have a range above 300 miles and be equipped with lidar — a light-based version of radar — for self-driving capabilities. The larger vehicle, the SF7, can be fitted with up to four motors for 1,000 horsepower and a zero-to-60-mph time under 3 seconds.
No sale date was provided for the SF7. The company will begin taking orders for the smaller SF5 by the year-end and promised customers they will begin receiving their cars by the end of 2019.
Potential customers will have to wait to find out the prices.
Jessica Caldwell, an analyst at Edmunds, said she’s intrigued but “it’s hard to be overly optimistic because there are a lot of people” in the EV business already.
Caldwell said SF Motors didn’t do itself any favors by operating mostly in stealth mode since its founding in January 2016. “It’s hard to take preorders for something nobody has ever heard of,” she noted.
On the other hand, the EV startup field is riddled with companies that turned the spotlight on themselves in hopes of raising money, only to struggle as expectations went unmet.
Faraday Future, based in Gardena, California, is the prime example. It stirred up great media interest in 2014 with plans to build a mammoth factory near Las Vegas, subsidized by Nevada’s government. But Chinese entrepreneur Jia Yueting, Faraday’s primary funder, ran into severe financial problems.
Faraday scuttled the Las Vegas project and now is struggling to manufacture its all-electric sedan at an old tire factory in California’s Central Valley, hoping to sell some vehicles in China for about $300,000 each. Jia is wanted for questioning by Chinese authorities and believed to be living in the Los Angeles area.
Startup Lucid Motors, based in Newark, California, not far from Tesla’s Fremont factory, introduced a car it calls the Air in 2016, with plans to build a $700 million manufacturing plant in Arizona. But factory construction is on ice as Lucid struggles to raise money.
Some executives from those companies have fled for other opportunities. Three former BMW executives left Faraday to start their own EV company in Los Angeles, Evelozcity. They say they’ll build EVS that sell for under $50,000 and claim to have a billion dollars in funding.
Despite her skepticism, analyst Caldwell sees SF Motors’ manufacturing capabilities as a big plus. Sokon has been building vehicle parts in China since the 1980s and has expanded into motorcycles, trucks and buses.
SF Motors purchased the Indiana plant from AM General, which made a version of the Hummer there. The plant was just finishing up a 2½-year contract to build R-class cars for Mercedes while Mercedes parent Daimler expanded capacity in the U.S.
So the workforce was already in place. Indiana stepped in with funding to help train workers in robotics, software and other high-tech manufacturing skills.
Battery technology could be another advantage. If Eberhard is able to deliver on his promises, better-performing batteries with higher energy density made in China could give SF Motors a price and performance boost.
Eberhard founded Tesla in 2003 with partner Marc Tarpenning. Elon Musk became an investor and joined the board of directors the next year. In 2008, Eberhard was pushed out of the company and Musk was named chief executive officer.
Considered one of the world’s leading electric powertrain specialists, Eberhard kept a low profile after leaving Tesla, working with various auto manufacturers including Volkswagen and Lucid. At the March 28 event, the company hinted that it might license technology or sell battery systems and components to other manufacturers.
Zhang, SF Motors’ 29-year-old founder, said he located the company in Silicon Valley because “there’s a lot of ideas and technology and talent in the United States.” The U.S. could also add some marketing gloss for customers in China who still see Silicon Valley as the center of the technological universe.
Zhang was educated in England but spent a lot of time in his native Chongqin. “I spent my vacations in stamping plants and welding shops” in China, he said.
Because his father’s company makes auto supplies, he was able to drive hot cars from all over the world and became a dedicated gearhead. The company’s marketing themes draw from three keywords: thrilling, aware and stunning.
When it comes to sales volume, China may loom larger than the U.S. market. SF Motors aims for production of 200,000 vehicles a year, but the Indiana plant’s capacity tops out at 30,000. The China plant is expected to produce many more.