An Interesting Week for Electric Vehicle Industry News and Small Cap Stocks: TSLA, KNDI, HPTG & GACR

There has been plenty of interesting news coming from the electric vehicle industry as well as from large cap stock Tesla Motors Inc (NASDAQ: TSLA) and small cap players like  Kandi Technologies Group Inc (NASDAQ: KNDI), HydroPhi Technologies Group, Inc (OTCMKTS: HPTG) and Green Automotive Co (OTCMKTS: GACR):

Tesla's Gigafactory Plans Leads to Plenty of Questions. Tesla's plans for a Gigafactory are grabbing plenty of attention and talk with Bloomberg noting there could be a bidding contest between short listed states like Texas, Nevada, Arizona and New Mexico seeking the 6,500 jobs the $5 billion investment could create while a Forbes contributor asked six questions with one about the factory's reported cost where the author speculated:

But it actually pencils out to a little more than two-thirds the cost, on a per GWh basis, of other large battery factories.  Clearly, the large scale of the factory will make equipment purchases cheaper.  Nevertheless, the estimated cost of the factory seems extremely low and brings into question whether Tesla and its battery partners have some new manufacturing innovations up their sleeves.

Or they have miscalculated... The author also noted that the environmental regulations for such an enormous factory are one negative factor weighing against California but:

That leads to a second question: Where will the cars be built? The batteries coming from this factory will be going into Tesla's next-gen passenger car, not the Model S or Model X. That means that a car factory could also come along with the battery plant. 

Meanwhile, CNBC's auto correspondent has speculated that locating the plant in Texas, the country's second largest auto market, could lead to a deal to lift the state's ban on direct auto sales albeit there would be a tough battle with the Texas Auto Dealers Association along with counties where auto sales are often the biggest source of sales tax revenue.

Tesla's Secret Plan to Make Electric Cars Mainstream. The Motherboard site has just noted Elon Musk's "secret plan" to make electric cars mainstream which was outlined in a not so secret blog post entitled: "The Secret Tesla Motors Plan." The "secret plan" could be summed up as follows:

Build sports car Use that money to build an affordable car Use that money to build an even more affordable car

Progress in the Chinese Electric Vehicle and Hybrid Market. The Wall Street Journal has reported that Chinese auto makers BYD Co. (which is partially backed by Warren Buffett) and BAIC Motor Co. had won approval from Beijing's municipal government to sell electric cars in the city while Switzerland's ABB Ltd. said it would make and market home, wall-mounted, electric-car chargers in China to address a lack of charging stations and other infrastructure if electric cars are to hit the country's roads in serious numbers. The Wall Street Journal went on to note that China's government wants 500,000 hybrid and electric vehicles on its roads by next year and five million by 2020. However, there were only around 17,600 such vehicles purchased in China last year and this figure includes hybrid and pure-electric cars and buses. It is also likely that there are no more than 50,000 such vehicles in use in China right now. Moreover, Elon Musk was pretty smug about BYD as a competitor in a Bloomberg Interview from a few years ago that can be seen here.

Kandi Technologies Group Says Its Rental Service is Profitable. Small cap Kandi Technologies Group, which makes specialized electric vehicles such as all-terrain vehicles and utility vehicles, surged some 16% earlier this week when the company said in an apparent Bloomberg interview that its service to rent out vehicles was profitable and it was planning to expand it to other cities, including Beijing and Shanghai. Kandi Technologies Group, together with its joint venture partner Geely Automobile Holdings Ltd, provides electric vehicles for short-term hire using automated multilevel garages in Hangzhou with rental rates that start from 20 Yuan ($3.3) an hour and covers the first 25 kilometers (16 miles) verses a starting rate of 11 yuan for taxis. Investors should take note that Kandi Technologies Group is up 39.6% since the start of the year, up 332% over the past year and up 2,689.8% over the past five years.

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HydroPhi Technologies Group Gives an Important Business Update. Small cap HydroPhi Technologies Group, a leading developer of water-based hydrogen fuel production systems which utilizes ordinary water for the production of hydrogen that is then injected into carbon-based fuels such as diesel, unleaded gasoline and natural gas, recently provided a business update for the fiscal third quarter of 2014. The update noted that HydroPhi Technologies Group had recently announced that Rutas Unidas Federación de Transportistas Independientes de México, the largest association of bus operators based in Mexico City, had reported consistent fuel savings in excess of 20% on buses equipped with HydroPhi Technologies Group's Hydroplant technology. The company is also in discussions with large fleet operators in selected markets in Latin America and Asia because its product provides significant environmental benefits, fuel savings and high return-on-investment for fleet operators. The CEO also commented:

"We have significantly improved our balance sheet from the prior fiscal year end largely by converting debt to common stock, thus reducing total liabilities from approximately $14.3 million to $4.8 million. At the same time, we have been keeping our current fixed costs low. So as sales, begin to ramp up, we expect to benefit from high incremental margins."

Otherwise, HydroPhi Technologies Group is up 39.2% since the start of the year.

Green Automotive Co Makes a Splash at a Show in Las Vegas. Small cap Green Automotive Company, a state-of-the-art niche vehicle design, engineering, manufacturing and sales company based in Riverside California, reported earlier this week that its Californian subsidiary Newport Coachworks was one of the major exhibitors at the recent LCT Show, one of the largest shuttle and charter events, where the company presented its shuttle bus range on a 2500 sq. ft. exhibition space. Over 450 bus operators apparently visited the company's stand from the US, Canada, France and a number of other regions plus GACR took orders for over $1.6 million. Green Automotive Company said it sold 9 Patriot models (a 19 to 23 seat shuttle bus), 3 Freedom 45 models (the company's biggest bus) and 2 up-market Limo model buses. The Green Automotive Company rose 6.82% yesterday.