While expectations are riding high that electric vehicles will be big beneficiaries from President Joe Biden’s $2.25 trillion infrastructure and stimulus blueprint set to be unveiled in Pittsburgh later today, EV stocks are mixed in morning trading on Wednesday.
Biden is proposing $174 billion in spending to boost the electric vehicle market, more than his plan allocates for highway and bridge repairs.
Shares of ChargePoint Holdings (NYSE:CHPT) are up more than 6% on Wednesday. Biden’s plan is reported to include incentives for state and local governments to build EV charging stations.
Meanwhile, Churchill Capital IV (NYSE:CCIV) stock was up 1.2%, set to extend Tuesday’s 10.1% gain. The special purpose acquisition company (SPAC) expects to merge with EV-maker Lucid Motors in a deal announced last month. The White House plan will include rebates and tax incentives to encourage EV purchases.
Republicans Could Rain on EV Parade
As ambitious as Biden’s plan may be, it faces an uphill — Capitol Hill, that is — battle. Even before the reveal in Pittsburgh, Republicans are voicing concerns about the proposal’s cost and the corporate tax hikes needed to pay for it. The White House is said to want to raise corporate taxes to 28% from the top corporate rate of 21% set by former President Donald Trump’s 2017 tax law.
While many EV stocks are already suffering from a market rotation as investors transition from growth to value stocks, others are down due to more fundamental factors.
Workhorse Group (NASDAQ:WKHS) continues to feel the impact of being passed over for a contract to supply the United States Postal Service (USPS) with a fleet of electric delivery vans, as InvestorPlace contributor Louis Navellier highlighted last week.
Canoo (NASDAQ:GOEV) stock has lost more than 34% in the last month. Josh Enomoto recently attributed the weakness to risks both in the EV delivery truck maker’s business subscription model and GOEV stock’s choppy price action.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, following fintech, agtech and property tech startups.