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- This week, Alexa St. John talked about covering the future of EVs and the auto industry.
Sarah Belle Lin: You're a transportation reporter who covers electric vehicles, supply-chain shortages, and EV startups and their VC investors. What were the roads you took to get here?
Alexa St. John: I started my professional career reporting on auto suppliers and mobility for Automotive News in Detroit. There, I got a great lens into the old and the new of the industry at the time.
Suppliers had long-standing businesses revolving around gas-powered cars but were pivoting as much as possible to be prepared for the future of EVs. For many, the transition was smooth; others were scrambling. Meanwhile, the mobility space was picking up traction and investment, with hundreds of companies rushing to solve the industry's biggest challenges in making the transition to electric and self-driving cars.
Admittedly, I'm not a car enthusiast, per se, but I do find the business fascinating. It touches on so many different topics beyond the vehicle and technology: equity and accessibility, policy and geopolitics, sustainability, and more. Those intersections are exactly why I find reporting on this space so dynamic and important. Companies big and small are making massive promises to the public and their shareholders about what they're going to do to better our future. They're scooping up billions of dollars to develop EV technologies. They need to be held accountable as they do so.
Lin: You've reported that the electric-car-charging market could be worth $207.5 billion by 2030 and that EV batteries could become a $360 billion market. What can you tell us about the biggest trends you're following right now in the industry?
St. John: Challenges within the automotive supply chain have been the most top of mind for the industry this year.
The transition to electric vehicles requires so many resources, and those resources can't be tapped into overnight. From selecting a new site from which to pull lithium, for example, to permitting, construction, extraction, processing, and eventually getting that lithium into a battery and into an EV — that takes years. And with each automaker promising to go electric by a certain year or introduce a certain number of new EV models in the coming decade, there's a disconnect with the resources readily available.
We've been hearing over the past 24 months or so just how many billions of dollars car companies are pouring into electrification and just how many electric vehicles they will have coming up in their pipelines. What we hadn't heard discussion about really until this year was how exactly they plan to source for all of those vehicles. Not only is it a matter of having the resources available when we need them (luckily the US has a lot of resources that haven't yet been tapped into), it's about reducing reliance on countries outside of the US and establishing a domestic supply chain.
Plus, for all sorts of components and resources, suppliers have to think: Do we continue to supply the big companies we've had decades-long relationships with, who we know have big balance sheets and gas-engine businesses to fall back on, or do we place a bet on the future of EVs with startups and risk supplying to low-volume businesses that might not even make it to the end of the year? I think that's what's keeping auto executives up at night most these days.
Lin: In your reporting, you've shared what VC investors are looking for, whether that's from EV, battery, and charging startups, or lessons and advice they're passing on to their startups amid today's market downturn. What have been the most surprising takeaways from your conversations with EV VC investors?
St. John: Despite the challenges we've seen startups in this space face, and despite many of those startups not being able to make it through many headwinds, investors in EV technology are still bullish.
They're also still seeking out certain technologies that will be needed to enable the transition to EVs. That essentially means that there are still opportunities for startups and entrepreneurs to create technologies that answer some of the EV industry's biggest challenges remaining, such as with charging infrastructure and the user experience, or maintenance of public plugs.
VCs still need to see companies that can solve questions surrounding what happens if a public charger is broken and it's the only one around for an EV driver. Who is responsible for the fix? How can charging companies provide a more reliable experience? And what is the easiest way of paying for charging, especially for hesitant consumers making the switch to an EV?
I've been pleasantly surprised to hear that VCs haven't been jaded by the vaporware this industry has seen over the past several years and that they're actually still eager to find startups creating a solution that is unique.
Lin: You've done a lot of reporting on EV makers. What headlines do you expect to see from Rivian, Lucid, and others in the coming months?
St. John: I expect to see more volatility across the EV space. These companies are facing countless challenges, especially at this moment in time: supply-chain crises, increasing incumbent competition, waning Wall Street faith, and, in some cases, turnover or layoffs. This combination of troubles will only continue for these budding companies, and per almost every discussion I have, not all of them will make it.
It's not easy making a car — and it's certainly not any easier building a brand-new electric one from scratch alongside brand-new manufacturing operations. A lot of the once exciting EV companies are starting to realize the challenges that are ahead of them, and with diminishing cash reserves, there will be shakeout.
Lin: OK, we have to talk about exploding EV batteries. What's the latest on this fiery topic?
St. John: I think there are misconceptions about EV batteries frequently catching fire given the major examples we've seen make the news — specifically the recall of 141,000 Chevy Bolts, a multiyear debacle that cost about $2 billion.
Some of the EV startups have also struggled with fires, like Lucid, Canoo, Rivian, Faraday Future, and Lordstown. But I think it's important to remember that these aren't actually that common — the challenge is more so that EV-battery fires require special handling to be put out.
There's also a whole crop of startups racing to ensure there is quality control within the battery-manufacturing process, and there are plenty of startups making tech to keep an eye on real-time battery health while an EV is in use to help avoid potential issues. That technology development makes me hopeful that the industry isn't putting in consumer hands cars that could ignite at any moment.
Lin: What has your reporting on the world of lithium unearthed? What are your thoughts about this argument about the dirty secret of electric vehicles?
St. John: The whole point of making the transition to electric vehicles is for environmental sustainability and bettering the environment. If the energy used to power these vehicles is dirty, there is no point. Likewise, if the practices with which the industry mines the materials needed to make this happen are problematic, both environmentally and in terms of human-rights abuses, that also negates the reason for the transition.
Automakers need to establish clean and fair ways of getting the materials so critical to their EV futures — and now. It's important to be proactive about this supply-chain planning, because, according to car companies, they're only going to need more and more of this supply.
From my conversations with lithium players here in the US, they are eager to be responsible moving forward — but this space is going to move fast as demand for this skyrockets, so they do need to be thinking about this now.
Lin: Would you ever own an EV, and, if so, which models are you eying?
St. John: In reporting on the industry, I've discovered that an EV would definitely fit into my lifestyle: Given my access to home charging and nearby public charging, given my minimal weekly mileage, and given the fact I don't road-trip on my own frequently, an EV sounds great. Let's get those prices down first — though I don't know if the Inflation Reduction Act will help with that.