Quebec City-based electric vehicle charging tech firm FLO has raised millions in new funding to support its push into the Canadian and U.S. markets. We’ll map out Canada’s EV challenge, what new money means for FLO’s future, and how Elon Musk might have opened the market up even more.
Developing: National Bank is offering to buy Canadian Western Bank in deal valued at $5-billion. Follow the story here.
In today’s edition
- How FLO’s funding might speed up EV infrastructure
- Why tech companies are speeding away from the TSX
- The Fed’s rate decision speeds up expectations for a cut
- Speed, a movie about a bus needing to go faster to keep a bomb from exploding, marked its 30th anniversary this week. We’ll try not to read too much into this confluence of events. Pop quiz, hotshot: Can you name a better action film from the nineties? E-mail me: cwilsonsmith@globeandmail.com
ENERGY
In a FLO state
A FLO charging station. The company is aiming to build more of these across North America.Supplied
As Kate Helmore reports, the firm has secured $136-million in a funding round led by Export Development Canada. The deal puts a spotlight on the road ahead for EV firms and policymakers.
For FLO: The firm – founded in 2009 by entrepreneur Louis Tremblay while still a student at Laval University – currently (electricity joke) charges 1.5 million cars per month at more than 85,000 stations.
- The company has likely seen the headlines, and is betting a bigger, more reliable and faster-charging network of stations across North America will do watt it takes (I’m sorry) to allay consumer concerns.
- In addition to expanding its network across Canada and the U.S., the EV company says it will also use the new money to speed up the rollout of its newest products: Among them, an “ultra-fast” charger that gets most new EVs to 80 per cent of their max capacity in 15 minutes.
- It might have an added boost after Elon Musk fired the team overseeing Tesla’s electric-vehicle charging business.
For Canada: For the federal government to meet its commitment to achieve 100-per-cent zero-emission vehicle sales by 2035, infrastructure spending needs to slip into a higher gear.
- Canada has one charging station for every 20 vehicles – compared to a global average of one for every 10, according to a report this year.
- That’s against a backdrop of growing EV momentum across the globe: A new study from the International Energy Association shows almost one in three cars in China is set to be electric by 2030, and almost one in five in both the United States and European Union.
- Export Development Canada, which led the funding, said FLO is well-positioned to grow: “We look forward to seeing them leverage this equity financing to scale across North America,” said Guillermo Freire, who oversees EDC’s clean-tech area.
For consumers: There has been a lot of attention on failing stations, which are already few and far between.
- And recent reports from JD Power, Deloitte and Autotrader show consumer interest in EVs is falling year over year.
- Ford is slowing its production plans in Canada, and General Motors is abandoning some EV goals.
OK, but: Surveys of consumer intentions and auto-maker speculation about future demand are not the same as actual sales, said Joanna Kyriazis of Clean Energy Canada. “And right now actual sales keep breaking records.
“We keep hearing that consumers are abandoning EVs, but let’s not confuse facts with culture war talking points,” she adds. “EV prices are down, and sales are higher than ever.”
TECHNOLOGY
Another ex from the TSX
Copperleaf Technologies Inc. agreed to a $1-billion takeover by IFS AB, becoming the newest in a slate of tech companies to exit the TSX, Sean Silcoff and Jameson Berkow report. The company sells “optimization artificial intelligence-powered software” to large enterprises, such as utilities and transportation infrastructure giants, to analyze spending.
Why it’s significant
Then: Investor interest in the Canadian tech space soared during the pandemic. Copperleaf shares were priced at $15 during its roadshow and hit almost $23 on its first day of trading.
Now: Market excitement soured as rapidly rising interest rates tested investors’ appetite for risk around early stage tech companies. Copperleaf is the ninth out of 20 tech companies to reverse course after going public during an unprecedented rush of new issues on the Toronto Stock Exchange in 2020-21.
Next: As tech giants in the U.S. generate eye-popping numbers, many software companies that aren’t playing squarely in the hot generative AI space aren’t getting the same love – from public markets, anyway. Private equity and deep-pocketed companies seem more willing to spend.
ON OUR RADAR
Fed up: Markets will have lots to absorb today with a U.S. rate decision and a key consumer price index reading. The World Bank already decided to upgrade its outlook for the global economy this year on the strength of U.S. growth.
In the aftermath: Frank Stronach’s alleged sexual-assault charges are raising questions for institutions bearing his name.
Ill communication: The IMF says the Bank of Canada should consider improving its communications around monetary policy.
No pain: No capital gains tax, the Conservatives say.
Morning markets
Global markets were mostly higher ahead of U.S. inflation figures later this morning and the Federal Reserve policy decision this afternoon that could determine the near-term outlook for interest rates. Wall Street and TSX futures were pointing to modest gains.
Overseas, the pan-European STOXX 600 was 0.51 per cent higher in morning trading, rising for the first time in four days. Britain’s FTSE 100 gained 0.67 per cent, Germany’s DAX added 0.54 per cent and France’s CAC 40 advanced 0.38 per cent.
In Asia, Japan’s Nikkei closed 0.66 per cent lower at 38,876.71, while Hong Kong’s Hang Seng fell 1.31 per cent to 17,937.84.
The Canadian dollar traded at 72.75 U.S. cents.