Nikola
The number of
electric vehicle SPACs may rise in the years to come as the world pivots to full EV adoption and looks for ways to raise money to fund the transition that could cost up to $2.5 trillion, according to Bank of America.
2020 saw a boom in electric vehicle SPACs, with companies including Nikola, Fisker, and XL Fleet all going public via a reverse merger with a special-purpose acquisition company.
BofA said the recent SPAC boom indicates that there is a lot of capital waiting to be deployed for companies participating in the "electrification revolution."
"With this in mind, we would expect the EV SPAC boom and capital raises for newer EV companies to continue in 2021+" BofA added.
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The number of
electric vehicle SPACs may rise in the years to come as the world pivots to full EV adoption and looks for ways to raise money to fund the transition, according to Bank of America. "The Auto industry is reaching an inflection point for electric vehicles, but funding this revolution is a tremendous hurdle," a team of BofA strategists led by John Murphy said in a note on Wednesday.BofA estimates that the transition towards 100% electrification could require over $2.5 trillion of investment around the globe over the next decade. One way to raise that capital could be through a SPAC. 2020 was a banner year for electric vehicle SPACs.
Nikola,
Fisker,
Lordstown Motors,
Canoo, and
XL Fleet Corp were just some of the companies that went public via a reverse merger with a special-purpose acquisition company in 2020. According to BofA, over $6 billion so far has been raised so far via EV SPACs.
Although that amount is nowhere near the $2.5 trillion capital goal, the recent SPAC boom indicates that there is a lot of external capital waiting to be deployed for companies participating in the "electrification revolution," said BofA.
