- Stocks had another strong session yesterday, closing 1.61% higher off strong economic data numbers domestically and globally, with progress in stimulus discussions.
- The $25 billion airline bailout expires on Thursday. Airlines are expected to begin furloughing workers and cutting routes to cut the cash burn rate. Airline revenue is down over 65% compared to last year.
- House Democrats released a fresh $2.2 trillion stimulus proposal, which is an attempt to compromise with Senate Republicans as the original House bill was $3.4 trillion. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin held talks last evening and will be speaking again this morning.
Kensington is currently in the process of buying QuantumScape, which, according to many in the electric vehicle industry, is building the best battery on the market. This is what former the Tesla Chief Technology Officer and current QuantumScape board member JB Straubel had to say: “QuantumScape’s solid-state anode-less design represents the most elegant architecture I’ve seen for a lithium-based battery system, and the company has an opportunity to redefine the battery landscape.” They are backed by Bill Gates, Chinese automaker SAIC, and most importantly, Volkswagen, who is also in a joint venture with the firm. Volkswagen produces 11 million cars a year and is going all-in on electric vehicles. Once the merger is complete, the new company at the current KCAC share price will have a valuation of around $4.8 billion. With over $1 billion in cash on the balance sheet once the transaction is complete, the company has enough cash to get to the production and profitability stage. If a QuantumScape battery is in just five million new vehicles a year (current annual production is 90 million) by 2035, it will equate to an estimated $25 billion in sales and $2 billion in profits, which would equal a valuation north of $30 billion.