The EV sector is in the middle of a recession with several companies like Nikola, Canoo and Fisker either filing for bankruptcy or going through serious financial issues. Its quite unfortunate but the graveyard of failed companies is littered with several car companies that have often started with a lot of fanfare only to run head first into the brutal realities of a competitive auto market. So, with all the doom and gloom in EVs and the auto sector, it is a bit surprising when you hear that a new EV company is trying to do the very thing that several other companies just burnt hundreds of millions of dollars on.
Enter Slate Auto, our next great EV hope.
Why This Time It’s Different
What Slate has got going for it are the deep pockets and financial backing of Amazon founder Jeff Bezos. Remember, Bezos’ Amazon was also an initial investor in and the anchor customer for Rivian, the only viable pure play EV company that is a competitor, in our opinion, to Tesla. And when Bezos invests, its a signal to other investors that this company is NOT going to suffer from a lack of capital in an industry that is a money hole. But its not just that, instead of working on a $75,000 luxury EV car that the market has clearly had enough of, Stable Auto is doing something different and working on a $25,000 two-seat electric pickup truck.
The Troy, Michigan-based company, which emerged from another Bezos-connected venture called Re: Build Manufacturing, has been operating in stealth mode while assembling a team of hundreds of employees, many recruited from established automakers like Ford, GM, Stellantis, Rivian and Harley-Davidson. In fact the CFO of Slate Auto, Ryan Green was once CFO of Rivian prior to its IPO.
Beyond Bezos, Slate has attracted investment from other wealthy backers including Mark Walter (controlling owner of the LA Dodgers and CEO of Guggenheim Partners) and Thomas Tull (lead investor in Re:Build Manufacturing), according to Delaware corporate filings obtained by TechCrunch.
Smaller Is Better
A lot of the problems with EV market so far is that it hasn’t played to its strengths yet. Even though there are EVs that go up to a 400 miles on one charge, it excels more as a daily commute vehicle that has to spend a lot of time stopping and starting in slow moving traffic. And if an EV is designed specifically for users that make these kinds of trips, the OEM doesn’t need to spend time and money trying to incorporate a larger 100 – 150 kWh battery into the design.
Most drivers would be ok with anything less than 50 kWh which allows the OEM to save a lot of money on the battery and gives them a lot of flexibility on the design. This smaller battery segment is the segment where EVs are taking off in the rest of the world as well, especially in auto markets which tend to have a lot of crowded, urban areas.
Slate is trying to capture this exact niche but do it in a quintessentially American way which is why you have a pick-up truck instead of a smaller European style sedan. Their goal is to build an electric pickup truck priced around $25,000 which makes it price competitive with the Ford Maverick. Sure its not going to have the range of a Ford Maverick but not everybody needs that range and charging stations are going to be a lot more common with every passing day.
How Much Money Does Stable Have?
The company built a financial war chest to pursue this objective, starting with its $111 million Series A round in 2023 in which Bezos participated. Building a car company isn’t a capital light endeavor which is why Slate also closed a Series B funding round soon after the Series A in late 2023. We don’t know what the valuation for the company was but it seems to have raised a ton of money at the right time i.e. when pro EV sentiment was still high.
The startup aims to begin production as early as late 2026 at a facility near Indianapolis. We are also hearing that Slate has reached out to folks in the industry for an event planned for late April (in a few weeks!) that could give us a lot more insight into its plans for the US EV market.
We think Stable’s market positioning is sound. Making a high quality but cheap vehicle that can appeal to cost conscious customers is the next great challenge for all EV manufacturers. If Stable can do it at the $25,000 price point or something similar, it would have enormous potential. And if Bezos allows it to take advantage of Amazon’s unmatched online distribution, you might even be able to buy it on Amazon Prime with a single click!
We wish them the best and hope they can successfully execute!