Greetings and welcome back to the InsightEV Weekender. Here, I like to focus on things we did not cover during the week.
When I first met the Damon team a few years back, the company’s concept made sense on so many levels.
It was a leap of faith and a leap in technology for electric motorcycles. We at InsightEV have often termed performance electric motorcycles, especially in the superbike zone, a no-go area full of thorny compromises. Power, top speed, weight, and range are all coordinates on a wobbly Jell-O. Pinch one, and the others deform.
So when Damon arrived, promising to fix everything simultaneously and deliver a motorcycle that would nearly match a Panigale V4S in power-to-weight, it sounded exciting.
What followed was millions in capital deployed, but Damon never really reached the finish line in terms of producing the motorcycle. They were always about USD 50m short. Then, a few weeks back, the new management made it look like the HyperSport had not even completed development. They awarded a USD 10m contract to the Italian consulting firm Engines Engineering. This, after Damon’s CTO left, did not sound very compelling.
Running short of money, Damon’s new management launched a new public offering of 126,900,000 units at a public offering price of $0.13 per unit. This helped them raise USD 16.5 million. However, a new public issue at that price diluted the existing shareholders comprehensively.
(Comprehensively copied from Damon’s press filings) As a result, on April 25, 2025, Damon Inc. received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC, stating that based on its review of the Company’s public filings with the SEC, its staff has determined to delist the Company’s securities pursuant to its discretionary authority under Listing Rule 5101.
Specifically, Nasdaq staff determined that the Company’s issuance of securities pursuant to the underwriting agreement dated March 20, 2025, particularly the Series A warrants exercisable on an alternate cashless basis as described in the Company’s prior SEC filings, raises public interest concerns because the issuance resulted in substantial dilution for its shareholders. Accordingly, as outlined in the letter, this matter serves as an additional basis for delisting the Company’s securities from Nasdaq.
The Panel hearing regarding the Company’s continued listing on Nasdaq is scheduled for May 20, 2025.
For now, Damon has ceased trading and flatlined. They should still have more than USD 16 million in the bank, so the company is not dead, but with every such misadventure, it inches closer to oblivion. Meanwhile, we have stopped waiting for the HyperSport, though it would be interesting to see how the company plans to survive.
Gogoro is Running Against Time
This week, the Taiwanese scooter manufacturer declared the Q1 2025 results and key metrics continue to deteriorate, without any recovery in sight. Scooter sales were down big, and the continuing small improvement in battery swapping revenues was too small to offset the decline. As a result, revenues were down, and the operating loss deteriorated further.
Most importantly, this was a negative cash flow quarter for Gogoro. This means it depleted its cash reserves further. There is no immediate cause of worry but Gogoro’s market cap is fast eroding and was just above USD 75m at close of trading on Friday.
Last week, the company moved its common stock from the upper-tier Nasdaq Global Select Market to the lower-tier Nasdaq Capital Market. This move aimed to buy more time as Gogoro faces delisting from the Nasdaq under the Nasdaq Listing Rule 5450(a)(1). The company’s stock has been trading under USD 1.0 consistently over the last six months, and Gogoro had till April 28th, 2025, to rectify the situation, which it could not. Moving to NCM allows Gogoro another six months to rectify the problem.
However, with a stock trading at USD 0.2567 and financials that are yet to improve, it will be a challenge.
InsightEV – Global Electric Mobility
Brazil: The Big Market is About to Turn
This week, the big analysis was about Brazil. With 1.9m two-wheeler sales in 2024 and a grid that is 90% green, it is surprising that Brazil has shied away from electric. Till now, that is. Things may be changing as major funds chase decarbonisation and startups sprout.
InsightEV – Global Electric Mobility
This week’s story was a primer, and we will continue to explore Brazil further for the next 2-3 weeks, talking to funds and significant startups.
Yadea has a disappointing 2024
This week, we studied Yadea’s latest annual report. The world’s largest electric two-wheeler manufacturer had a double-digit decline in both sales and profits. However, it continues to be the global leader by a comfortable margin. With nearly four million in electric scooter sales, no one comes close to Yadea.
Heck, it’s four times the entire Indian E2W industry.
Yet, it gets talked about not too much, and we (Mea Culpa!) would rectify this with a deep dive sometime soon.
Till then, here is our take on their latest financials.
InsightEV – Global Electric Mobility
Kofa Raises Pre-Series-A Funding
Kofa is one of Africa’s youngest electric motorcycle and battery swapping players. Yet, we have found them very distinctive, forward-looking, and somewhat of a trailblazer. Now, the Ugandan firm has raised its pre-Series-A round from E3.
The Netherlands rolls back BPM
The Netherlands, especially Amsterdam, has always been at the forefront of electric mobility in Europe. So it was shocking when the Netherlands government announced the BPM tax on electric mopeds. The 19.4% tax would have increased the prices by more than a thousand Euros in many cases.
Thankfully, the government has partially rolled back the BPM tax on electric motorcycles and replaced it with a flat EUR 200 fee.
Bankrupt Zeway Reborn with Heetch
Before we go further, I would like to point out that Sieghart Michielsen (Director of International at NIU Technologies) writes a weekly newsletter on LinkedIn. It’s a must-read.
This week, he pointed us to the news that Zeway, the French electric scooter and battery swapping player that went bankrupt a couple of weeks back, has been resurrected by Heetch. The brand would be relaunched as Sweetch.
The new entity would rent scooters and offer battery swapping as a subscription.
That’s a wrap for today. This newsletter will be back next Saturday. The posts on the website are more frequent. This is your editor, and you may view my LinkedIn profile here.