US-based electric bus maker Proterra, which may be looking to go public, is planning another fundraising round that is likely to push the company to a unicorn-class valuation of US$1bn.
The company supplies transit buses to cities across the US and employs a number of former Tesla engineers and executives.
The private equity sale (which the company registered on August 2nd) could raise up to US$75m in support of the company’s planned expansion beyond transit buses and into a new business unit aimed at selling EV components such as its batteries and motors.
Analysis and Comments
The bus sector is the easiest to electrify because of the predetermined nature of the driving routes which makes it easier and less costly to set up charging points. This explains why 60% of the bus fleet in Chinese cities is already electric.
The bus sector contributes 10% to road related emissions despite being less than 1% in terms of the vehicle fleet. Electrification of bus fleets in Europe and the US will likely speed up over the next 5 years.
Chinese companies such as BYD will likely capture the bulk of the international electric bus market,especially short range city buses (also called transit buses). This will be because of their clear cost advantage versus western OEMs. Companies like Proterra are hence focussing on higher value longer range electric buses.