Corp. & VCs on Liquid Fuels Vehicles vs. Electric Vehicles
It is widely agreed upon that our existing transportation infrastructure needs an overhaul in order to reduce the current level of vehicle emissions. Nevertheless, there has been much debate on the future source of renewable energy for the transportation sector. Will all cars of the future be electric? Or will we see a series of bio-refineries being built across the globe to produce renewable fuels that can be used by existing vehicles? Depending on who you talk to, you may hear a completely different answer. Therefore, let’s examine the hard data, the Corporate and VC investments tracked by the i3 Platform in the Transportation sector:
The immediate trend we notice is the significant spike in investments in Electric Vehicles and Drop-in Fuels in 2010. Several reasons contributed to the spike, including multiple mega-round investments into infrastructure-related projects, such as the development of charging stations and the construction of large-scale bio-refineries. Nevertheless, based on this data, we have seen that the Corporate and VC community has made a comparable amount of investments into both energy types (when we combine investments in liquid fuel vehicles and drop-in fuels). Since this first wave of investments, the electric vehicles sector has definitely received relatively more success than drop-in fuels. For instance, Tesla Motors recently announced it has exceeded its targeted sales for 4Q2013 by 20%; meanwhile, KiOR decided to halt its Columbus production facility in order to implement a number of engineering optimization solutions.
These examples certainly do not paint the entire picture of this complex landscape. Nevertheless, our data clearly indicates interest in both energy types. Going forward, we will likely see a co-existing ecosystem where bio-based liquid fuels are blended into gasoline engines, while advanced electric vehicles are continuing their success in the market. Let us know on twitter @cleantechgroup your thoughts on the changes we will face in the transportation sector!