Rather than building and operating its own auto-assembly plant, which has required billions of dollars of capital expenditures for Tesla, EVelozcity is in talks with U.S. and Chinese companies for contract production, Krause said. Also unlike Tesla, it will source batteries, motors and components for autonomous driving capability from outside suppliers.
“Over time battery packs and electric motors will not offer a potential for differentiation anymore,” Krause said. “The technology is evolving and that will be a commodity over time.”
The brand’s value will come from unique design and engineering, taking a page from Apple.
“If you look at Apple, they are designers and engineers, they don’t necessarily manufacture themselves,” Krause said. “We want to develop an American boutique, native EV brand. That’s what we’re all about. We believe that the engineering and design skills are going to be the core ones, not the manufacturing ones.”