What happened

The stocks of three niche electric-vehicle (EV) companies are dropping sharply today. As of 10:35 a.m. EST, shares of GreenPower Motors (NASDAQ:GP) are down 14%. Shares of CIIG Merger (NASDAQ:CIIC), a special-purpose acquisition company (SPAC) that is merging with U.K.-based van and bus EV company Arrival, are down 10%, while those of Blink Charging (NASDAQ:BLNK) are down 11%. 

While there is no new company-specific news today on any of these, there have been some related announcements in the EV sector today. And the stocks of each is still up significantly for the month of November. 

So what 

The EV sector took a hit this morning when aspiring electric-truck maker Nikola (NASDAQ:NKLA) announced it has revised its previously announced deal with General Motors (NYSE:GM) and is abandoning its Badger pickup truck project. 

GreenPower and CIIG may be moving in sympathy, as both are also in a niche EV market segment. 

Arrival van and bus on the road

Arrival van and bus. Image source: Arrival.

Arrival, which will be going public on the NASDAQ with the symbol ARVL through its merger with CIIG, has plans to make electric municipal buses and commercial transport vans. The company says the products will be priced competitively with fossil fuel vehicles and significantly cheaper than comparable EVs.  

GreenPower Motor is also building buses and vans. The Canadian company is already producing vehicles, including its EV Star shuttle bus and its all-electric school bus dubbed the BEAST (Battery Electric Automotive School Transportation).

Blink Charging doesn't make vehicles but rather charging stations. But the stocks of all three companies were soaring in November until a reversal began last week. That reversal continues today, with the Nikola news potentially contributing to souring investor confidence. 

GP Chart

GP data by YCharts

Now what  

Blink Charging was also the target of a short-seller report last week. Citron Research says it believes management is deceiving the public and that the stock will trade sharply lower. 

Separately today, short-seller Hindenburg Research released a report on Chinese EV maker Kandi Technologies (NASDAQ:KNDI), saying the company used a "scheme to falsify revenue using fake sales." 

These attacks on high-flying EV companies are beginning to affect the sector, it seems. While Arrival says it has contracts signed for a backlog worth $1.2 billion, it hasn't produced a vehicle yet. GreenPower has reported 2020 revenue of only $13.5 million from its electric shuttle vans and school buses. 

Investors in the EV sector are starting to realize that the stocks of all electric-vehicle companies are not going to continue soaring. Company-specific fundamentals have to be the ultimate driver of value, and today's move is part of that realization.