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Corporate investors pile into electric vehicle startups

Reuters  |  DETROIT 

By Paul Lienert

DETROIT (Reuters) - Corporate investors from outside the auto industry are placing increasing bets on electric vehicles, vying with automakers and suppliers to bankroll startup companies working on everything from advanced batteries to charging devices and all-new EVs.

Some 250 startups involved in some aspect of electrification have attracted more than $20 billion in venture capital, notably from a broad array of corporations across multiple industries, according to a analysis of publicly available data.

"Electrification will set off a number of economic changes in the traditional in and around vehicles," said Reilly Brennan, of San Francisco-based Trucks

Because of those changes, in addition to funding EV development, investors see revenue opportunities in related markets, such as and home energy, Brennan said.

Such opportunities are underpinned by steady improvements in lithium-ion batteries' energy, prompting forecasts for a surge in fleet electrification amid global efforts to fight fuel consumption and emissions from traditional internal combustion engines.

Big companies such as and see EV-related investments partly as a hedge against dwindling demand for fossil fuels for privately owned vehicles, according to venture investor Evangelos Simoudis, of

But they also see an opportunity to provide electric vehicle charging at fuel stations that now dispense gasoline and diesel.

Simoudis, who advises corporate executives on new mobility innovation strategy, said companies have a vested interest, too, in startups working on advanced battery systems: "and are both working on electric planes."

Large telecommunication companies such as will play a role in connected electric vehicles, while makers such as and see their being used in an increasing number of applications in future electric and self-driving vehicles, Simoudis added.

Far and away the most active corporate investor in electrification so far is Intel, which has backed Prieto, Qnovo and Enovix and charging startups WiTricity and Chargifi.

Global automakers are heavily invested in The field includes Co , , Daimler AG , , Motor Co <7201.T>, <005380.KS> and <600104.SS>.

Outside the auto industry, corporate investors in include companies <005930.KS> and and company .

Dozens of the startups focused on EV charging and infrastructure have been funded by many of the same corporate investors, including and [ABB.UL].

The greatest interest from investors, however, is in EV startups. There are more than 50 globally, including several high-profile and well-funded wannabes based in

Corporate investment in China's startups has come from big Chinese companies such as automaker <000800.SZ> and Co <300750.SZ>, which have backed Byton; automaker [GEELY.UL] and firm , which have funded WM Motor, and , which has invested in

In the United States, GM and BMW have backed Proterra, the electric bus maker, while , which is best known for heavy construction machinery, has invested in Henrik Fisker's latest electric vehicle project, Fisker Inc.

(Reporting by in Detroit; Editing by Tom Brown)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sat, January 12 2019. 03:26 IST