Yesterday, CTEK press released that General Motors and CTEK have decided to discontinue their EVSE partnership (19kW premium charger). We consider the news negative – especially since CTEK has followed up the turbulent period in 2022 and 2023 with solid reports throughout 2024, slowly regaining investors’ trust. However, the financial impact is not that severe. The discontinued partnership is due to lower-than-expected EV sales and low take rates for the chargers. It is stated that CTEK will make Q4 impairments in the range of SEK70-90m, primarily intangible assets, but also inventories. Also, CTEK’s total GM sales in 2024 are expected to amount to SEK75m with 5% EBITDA margin (SEK55m product sales & SEK20m payment for the already cancelled 11kW charger), largely in line with our estimates.

The partnership has not developed in the way both parties initially thought in terms of EV sales and charger take rate (which the cancellation of 11kW charger signalled). However, we thought that GM would continue promoting the premium charger, which, coupled with increasing EV sales and an acceptable take rate, would provide solid sales volumes for CTEK (which it has done). We understand there will be discussions with GM to find a financial solution for CTEK’s inventory related to GM (both raw materials and final products), although it is difficult to pinpoint the amount or the timing. If we had to guess, we would say Q2 2025, but we do not include this in our estimates and therefore consider any positive outcome a bonus.

We reduce our expected 2025-2026 EVSE OEM sales by SEK70-90m pa as this was our expected implicit GM sales. Since the GM volumes had a relatively low margin (5% EBITDA in 2024), the impact on CTEK’s EBITDA is limited. We slightly reduce our DCF assumptions for the EVSE sales to reflect the reduced GM sales, which, in total, reduces our fair value range to SEK10(11)-SEK38(42) with a base case of SEK24(28) per share.