Here's why so many electric vehicle startups fail

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The EV revolution is a tempting proposition for entrepreneurs. But the business is not for the faint of heart. Successes tend to have a few common traits.

As the electric vehicle industry faces a string of high-profile failures, several startups that have surfaced in recent years have underestimated their capital needs by billions of dollars, industry insiders said.

"Tesla, outside of the Chinese, is kind of the first automaker to start in half a century," said Mark Wakefield, managing director at AlixPartners."Rivian and Lucid are sort of the next two closest of the Western ones. Both of them have eviscerated $10 billion. So it's interesting to see these other small startups who raise $1 billion or $2 billion and they think that's enough. It's not even close.

EVs made up 8% of U.S. new car sales that year — and their share of the market is set to grow despite slower-than-expected adoption. EVs are expected to be 46% of new vehicle sales by 2030 — nearly 8 million units. Even deep-pocketed companies in other industries that have planned forays into automotive dreams have thrown in the towel. Apple shut down its

 

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