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Clean energy journalism for a cooler tomorrow

Startup Motor revs up its EV subscription service with Series A funding

The all-inclusive concierge service helps consumers bridge the gap between the test drive and buying an electric car.
By Julian Spector

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Two men look at a white electric vehicle that has its doors and hatchback open
Motor delivers a Nissan Leaf to a new customer. (Motor)

The startup Motor will expand its efforts to encourage electric-vehicle adoption with a recently raised $7 million Series A investment from AES and Mitsubishi Corporation.

Motor’s premise is that millions of Americans want to switch to electric driving, and could do so without disrupting their routines — these households can charge their EV at home and have a second, non-electric car for long trips. That’s a refreshing alternative to the conventional worries that EVs will never take off until battery packs deliver far more range and public charging becomes broadly available.

As Canary Media previously reported, Motor tries to reach these potential EV drivers by taking care of all the banal but often confusing logistics: acquisition and delivery of the electric car, registration, insurance and charger installation.

Motor’s subscription-based business model means that drivers pay a flat monthly fee for as long as they want the car. The cost of the charger and its installation get waived if the customer subscribes for a certain amount of time. Motor simultaneously gets paid by electric utilities for facilitating new electric-car customers and signing them up for smart-charging programs to help the grid (with the chance to opt out, if desired).

Motor started within power company AES, which owns traditional utility companies but also develops its own clean-energy projects around the world. Motor launched operations with two of the company’s subsidiary utilities — Indianapolis in early 2021, and Dayton, Ohio more recently. So far, Motor has helped hundreds of drivers get an EV, said founder and CEO Praveen Kathpal. In its first year in Indianapolis, Motor helped increase the city’s rate of EV ownership by 20 percent.

The company has yet to close a deal with a non-AES utility, but that will happen this year, Kathpal said. Mitsubishi’s investment does signify that a company outside of AES sees Motor as a viable way to navigate the intersection of the automotive and power industries that results from replacing gasoline with electricity.

Electric utility companies broadly recognize that the EV revolution promises a massive source of new demand for their core product. That’s good for business — but it’s hard to plan for when utilities themselves have little or no role to play when someone buys a car. Motor offers utilities a way into that sales process.

We’re connecting the automotive sector and utilities at the point where the customer gets the car,” Kathpal said.

But to succeed, the company has to prove useful to drivers, and Kathpal said he’s already adapting to customer input. At launch, Motor stressed the flexibility and accessibility of monthly EV subscriptions as an alternative to buying a car outright. But it turns out that a lot of people really want to buy an EV outright.

Motor is evolving to help people cross the commitment cliff” between a typical test drive and a purchase. For instance, it now offers a Subscribe-to-own” program, in which credit from the initial subscription applies to an eventual purchase.

The customer can have the car in their life — in the context of their commute, taking the kids to school, going to grandma’s house,” Kathpal said. It builds a greater level of comfort that an EV is going to work for their lifestyle,” Kathpal said.

Motor is a member of a small but growing cohort of startups tackling the consumer-facing barriers to EV adoption. On the other side of the country, early-stage startup Zevvy is expanding EV access with a different model: low-cost leases designed for the long-distance commuters who stand to gain the most in fuel and maintenance savings by driving electric. Zevvy raised a $5.4 million seed round last fall to expand its leases to 1,000 California super-commuters.

Financial startup Tenet seeks to lower loan payments for EVs by more accurately assessing the credit impacts of buying an EV instead of a car with an internal combustion engine. Tenet raised an $18 million seed round in 2021 and aims to finance at least 10,000 EVs by the end of 2023, Canary Media reported. Tenet is working with Treehouse, a startup that models the highly variable cost to actually install charging equipment in homes, and wrap that into the car loan.

Julian Spector is a senior reporter at Canary Media. He reports on batteries, long-duration energy storage, low-carbon hydrogen and clean energy breakthroughs around the world.