Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why CIIG Merger (Arrival) Stock Surged Over 30% Last Month

By John Rosevear - Jan 7, 2021 at 2:23PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Electric vehicles are hot, and Arrival's manufacturing plan makes it extra-interesting.

What happened

Shares of CIIG Merger ( CIIC ) jumped 31.8% in December, according to data provided by S&P Global Market Intelligence. The special-purpose acquisition company (SPAC) announced in November that it will merge with Arrival, a U.K.-based maker of electric buses and commercial vans. 

So what

The story here is pretty simple: CIIG's stock did well in December thanks mostly to the intense investor interest in everything having to do with electric vehicles. Its largest gain came early in the month, on a spike following the publication of an interview with CEO Avinash Rugoobur. 

Looking a bit deeper, it's the company's manufacturing plan that could make Arrival particularly interesting to auto investors. Rather than building a traditional automotive plant, which can take over a year and cost $1 billion or more, Arrival plans to build its vehicles in "microfactories" that can be up and running in roughly six months at a cost of $50 million each. The idea is that it can add new microfactories as needed, purchasing more manufacturing capacity in small increments as its sales grow. 

Two Arrival vehicles, an electric bus and a small electric van.

Arrival expects to have its electric buses in production by the end of this year. Electric commercial vans will follow in 2022. Image source: Arrival.

Arrival plans to begin with two microfactories, one in the U.K. and one in South Carolina. The company plans to begin production of its buses in the fourth quarter of this year, with two commercial vans following in the second half of 2022.

Now what

CIIG's merger with Arrival is expected to close by the end of March. The merged company, to be called Arrival Group, will trade on NASDAQ under the ticker symbol "ARVL". 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

CIIG Merger Corp. Stock Quote
CIIG Merger Corp.
CIIC

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
640%
 
S&P 500 Returns
139%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/03/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.