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Another electric car company goes down!

2024-06-25 Update From: AutoBeta NAV: AutoBeta > News >


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On June 8th, German star electric car company Next.e.GO Mobile (hereinafter referred to as "e.GO") announced the formal suspension of business operations. At this point, another new force in car-building fell down.

According to the data, e.GO was founded in 2015 and is almost on the same starting line as most of the new car-making forces in China. It was once regarded as a model of German automobile industry 4.0, and Professor G ü nther Schuh, as the founder, is also regarded as the pioneer of German electric cars.

G ü nther Schuh is not only the founder of e.GO, but also the professor and managing director of the Mechanical structure and production Engineering Laboratory (WZL) at the Technical University of Aachen (RWTH) in Germany. In 2010, G ü nther Schuh, together with the R & D team of Germany's top universities, founded the first car-building company, Street Scooter, which was initially a privately organized research project of the Aachen University of Technology, and later developed into an independent company of Aachen Polytechnic University. the company mainly designs and produces new energy vehicles for urban logistics and distribution and is regarded as a successful example of "German-made" electric vehicles. It was finally acquired by Deutsche Post in 2014 and became a wholly owned subsidiary.

Shortly after the sale of StreetScooter, G ü nther Schuh set up a new electric car company, e.Go Mobile AG, which produces affordable, small, smart and connected urban electric vehicles with zero emissions. In 2017, the first model, the e.Go Life, was unveiled at the CeBIT Information and Communications Technology Expo in Hanover, Germany. The highlight of this electric car is that it can be recharged without relying on a charging post and a standard socket. It is understood that the 60kW version of the model can achieve the life of the 145km, with a high price of 19900 euros, and the price to 20, 000 euros makes e.Go very competitive in the small electric car market, not to mention that this price does not include government subsidies and other cross-subsidies.

At that time, e.Go was regarded as a model of German electric vehicles and was supported by the German government at the beginning of its establishment. No matter in terms of the company's leadership or the development process, e.GO has unlimited potential. Its first electric vehicle is very popular after its launch, and the company's market positioning for its products is also very accurate. After all, in Europe, which is an important market for minicars, there is a much higher chance of success in launching an inexpensive mini electric vehicle, especially with a reliable technical background and the blessing of large companies.

At the 2019 Geneva Motor Show, Volkswagen announced that the first external partner of the MEB platform was officially recognized as e.GO. In 2020, e.GO also tried to enter the Chinese market, working with a Chinese manufacturer and hoping to build a production plant, but was eventually shelved because of the epidemic. It was in this year that e.GO began to have a financing crisis and the capital chain broke, but it was finally rescued by the Dutch private equity firm ND Industrial, and eventually became its major shareholder, and began to build a new plant to resume production and carry out multiple rounds of financing. In addition, e.GO also plans to list on NASDAQ in the United States to raise more funds.

In October 2023, e.GO merged with special purpose acquisition company (SPAC) Athena Consumer Acquisition and listed on Nasdaq. The former IPO company said it was valued at about $900 million, but the maximum market capitalization on the day of listing was only $130 million. Unfortunately, the listing of e.GO became the final glory, and since then its share price has continued to decline and has long been below the $1 threshold before being suspended from the Nasdaq Stock Exchange in April 2024.

As for the reasons for the bankruptcy, e.GO said on its website: "due to the adverse development of the electric vehicle industry and the turmoil in the capital markets, the company lacks the ability to continue financing, which has been exacerbated by the situation of other participants in the industry recently." It is understood that there has been a serious cash flow crisis in e.GO. As of June 30, 2023, the operating income was only 256000 euros, but the net loss reached 24.22 million euros.

E.GO 's collapse is not alone. For example, Fisker, an American star car maker, announced bankruptcy proceedings in May. Facts have proved that the current market is already facing tremendous competitive pressure, not only for startups, but also for some world-class giants, such as Tesla.

In 2024, the overall inventory pressure of the automobile industry increased, a new round of "price war" was set off, and the whole industry fell into a state of "internal volume", not only volume price, volume configuration, volume flow, and even volume boss. Nowadays, with the change of the market environment, everyone has admitted the rationality of "internal volume". In the past, it was the first-mover advantage and capital advantage, but in the second half, we had to rely on the industrial chain system, rapid adaptability, and differentiated products / services to win.

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