If it’s not artificial intelligence on investors’ minds, it may be this: What about electric vehicles?
The initial euphoria as EV companies launched and have worked to establish the beachhead against Tesla has waned — it’s been a struggle to turn dreams into reality.
Investors this week will get more data from automakers, EV companies and otherwise, that should offer a clearer picture of the state of the art tech now and coming up.
Another big week of earnings ahead
The week features reports from three Dow companies, McDonalds (MCD) , Caterpillar (CAT) and Walt Disney (DIS) .
It also includes reports from restaurant giant Chipotle Mexican Grill (CMG) , a host of drug companies like Eli Lilly (LLY) , and a smattering of energy companies, including BP (BPAQF) and ConocoPhillips (COP) .
Disney, which reports Wednesday after the market close, is now in a bitter proxy fight with activist investor Nelson Peltz’s Trian Partners. Peltz insists the company, led by Bob Iger, is spending too much money and getting little in return from a portfolio of struggling assets like ESPN.
The problem he has learned this past week is investors apparently view Tesla as a car company. And a wide-open market to Tesla is increasingly competitive.
This week’s reports come from Toyota (TM) and Ford Motor (F) on Tuesday and Honda (HMC) on Friday.
In between is ride-sharing company Uber Technologies (UBER) , which relies on the web, telephony and, increasingly, AI, to expand its business.
The auto earnings reports will appear this week and the next two.
Ford has to deal with higher costs (thanks to a UAW strike this past summer), supply-chain issues related to just getting parts, and frustration that prices and operating costs are problematic to would-be new buyers.
Tesla isn’t unionized, so it doesn’t have that same labor problem. Ford is also taking a different path than Tesla, which cut its electric F-150 Lightning production in December even as Tesla accelerates Cybertruck.
Meanwhile, despite Tesla’s success, Honda hasn’t been selling any EVs in the U.S. until this year when it plans to launch the Acura ZDX and Honda Prologue crossover SUVs. Its approach for EVs in the future includes 30 new EVs by 2030, another marked difference from Tesla, given its far more limited lineup.
In short, the question is if the EV market followed the classic pattern of many companies starting up and struggling to stay alive.
Toyota is in a position to be snarky. Its U.S. shares are up 10.5% this year compared to Tesla’s 24.4% decline.
Toyota Chairman Akio Toyoda has been skeptical EVs will be adopted as fast as Musk and others insist. Maybe in developed countries, he concedes, but not in countries where the charging infrastructure is not in place, he said recently.