EV startup Arrival reported its Q2 earnings this morning, announcing several significant milestones. The UK-based EV company says it will begin production of its highly-anticipated EV van in Bicester this quarter.
Arrival is a unique EV startup ad tech company focusing on commercial electric vehicles like buses and vans. The company is making swift progress in bringing its EV models to market.
Meanwhile, the EV startup has locked in several deals with major customers to electrify its fleet. For example, in 2019, Arrival partnered with Hyundai to develop EVs using Arrival’s technology. As part of the agreement, Arrival received an investment worth 100 million Euros.
Arrival rapidly followed up its investment with a supply agreement from the United Parcel Service (UPS).
UPS, which makes over 5 billion deliveries per year, agreed to buy 10,000 vans between 2022 and 2025, worth up to $1.2 billion in revenue. And then, in May 2021, Arrival partnered with Uber to develop the Arrival Car, an EV built for ride-sharing.
However, last week Electrek reported Arrival will be halting progress on its EV bus and car models to zero in on van deliveries.
The global economy is on edge between higher inflation, rising interest rates, and falling equity prices. As a result, Arrival, along with many other companies, is experiencing financial hardship. Therefore, the EV startup has made some tough decisions that will allow the company to re-align its goals and focus on the future.
Now arrival is addressing these issues in its Q2 earnings report. Here’s a look at Arrival’s financial situation.
Arrival Q2 earnings highlights and progress updates
According to Arrival’s Q2 earnings report, the company took significant steps to bring its EV van to market while securing new sources of capital to fund the initiative.
The EV startup established a $300 million At The Market (ATM) platform, allowing Arrival to sell stock as needed to raise funds. Arrival believes the program will fund the business through at least 2023 without needing to raise additional capital.
Arrival’s CEO and founder, Denis Sverdlov, gives us an overview, saying:
We have had big achievements in Q2 including the European certification of our Van and Bus products and successful internal trials of both Van and Bus on public roads. In addition we’ve made recent strategic decisions that will allow us to start production this quarter in Bicester (UK), deliver our first vehicles to UPS this year, and start production in Charlotte (US) in 2023.
We are excited to be drawing closer to producing vehicles in our first ever Microfactory in a few weeks – a moment that we believe will fundamentally change the automotive industry.
Arrival plans to learn what works best with a slow rollout at its Bicester Microfactory before building its Charlotte location. As a result, the company is pushing back its timeline to 2023.
Overall, Arrival posted a loss of close to $90 million in Q2, compared to $56.2 million in Q2 2021. The higher loss results from rising expenses as the company looks to ramp production. That said, Arrival does not expect to see revenue this year.
Arrival expects around 20 vehicles to be delivered this year, with production starting in Bicester in Q2.
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