Mullen Automotive Ships Initial Commercial EVs Under $210M Purchase Contract with Volt Mobility

Rhea-AI Summary

Mullen Automotive (NASDAQ: MULN) has begun shipping electric vehicles under a $210 million contract with Volt Mobility in the UAE. The agreement covers 3,000 Class 1 and Class 3 EV cargo vans and trucks over 16 months, with revenue recognition starting in Q1 FY2025. The initial shipment, part of a 300-vehicle commitment for 2024, left on September 2, 2024.

Volt Mobility plans to lease these EVs to corporate clients like UPS, DHL, and FedEx in the Gulf Cooperation Council region. Mullen's Tunica, Mississippi facility, capable of producing 26,000 vehicles annually, is assembling the order. This partnership marks Mullen's expansion into the Middle East market, following its growth in Europe.

Positive

• Secured a $210 million purchase contract for 3,000 EVs
• Initial shipment of vehicles completed on September 2, 2024
• Revenue recognition to begin in Q1 FY2025 (starting October 1, 2024)
• Expansion into Middle East market through partnership with Volt Mobility
• Production capacity of 26,000 vehicles annually at Tunica facility

Negative

• Revenue recognition delayed until Q1 FY2025
• Initial deposit of only $3 million on a $210 million contract

Insights

Financial Analyst

The shipment of initial vehicles under Mullen's $210 million contract with Volt Mobility marks a significant milestone for the company. This deal, involving 3,000 EVs over 16 months, could substantially boost Mullen's revenue and market position. The $3 million initial deposit and planned revenue recognition starting Oct. 1, 2024, indicate positive cash flow prospects. However, investors should note that the full revenue impact won't be immediate, as deliveries are spread over time. The company's production capacity of 26,000 vehicles annually at its Tunica facility suggests potential for scaling, but execution will be key. While this contract is promising, Mullen's ability to meet delivery schedules and maintain quality will be important for long-term success in the competitive EV market.

Market Research Analyst

Mullen's entry into the Middle East and Gulf States market through Volt Mobility is strategically significant. The region's focus on sustainability, exemplified by initiatives like Dubai's Green Mobility Strategy 2030, presents a growing market for EVs. Volt's existing relationships with major logistics companies like UPS, DHL and FedEx across the GCC region provide a solid customer base for Mullen's vehicles. This partnership could serve as a springboard for Mullen to expand its global footprint beyond its recent European expansion. However, the EV market in this region is still developing and Mullen will face competition from established global automakers. The success of this venture will depend on the performance of Mullen's vehicles in the region's climate conditions and their ability to meet the specific needs of last-mile delivery in these markets.

Tech Expert

Mullen's commercial EV lineup, including Class 1, 3, 4 and 5 vehicles, demonstrates a comprehensive approach to the electric commercial vehicle market. The company's focus on last-mile delivery aligns with growing urban logistics trends. Compliance with U.S. Federal Motor Vehicle Safety Standards, EPA and CARB certifications is important for market acceptance and potential future expansion. However, the EV industry is rapidly evolving and Mullen will need to continually innovate to stay competitive. The Start of Production for the Bollinger B4 in September 2024 will be a critical test of Mullen's manufacturing capabilities. Investors should watch for any production delays or quality issues, as these could impact the company's reputation and future orders. The success of these vehicles in real-world conditions, especially in the challenging Middle Eastern climate, will be a key factor in determining Mullen's long-term prospects in the commercial EV sector.

Company to recognize revenue under the agreement in fiscal quarter 1, commencing Oct. 1, 2024

BREA, Calif., Sept. 04, 2024 (GLOBE NEWSWIRE) -- via IBN – Mullen Automotive, Inc. (NASDAQ: MULN) (“Mullen” or the “Company”), an electric vehicle (“EV”) manufacturer, announces today the shipment of initial vehicles under a significant $210 million purchase contract with Volt Mobility (“Volt”), based in the United Arab Emirates (“UAE”). Mullen to recognize revenue under the agreement in fiscal quarter 1, beginning on Oct. 1, 2024.

The agreement is for Volt to purchase 3,000 Mullen Class 1 and Class 3 EV cargo vans and trucks over a 16-month period. Mullen shipped the initial commitment of commercial EV cargo vans and trucks on September 2, 2024. The initial shipment of vehicles represents the first phase of the multi-vehicle agreement between Mullen and Volt Mobility with the planned shipment of 300 vehicles in CY 2024.

The contract includes a $3 million initial deposit, as referenced in the Company announcement from Aug. 26, 2024, and as part of the program initiation with additional payments expected as the vehicles are shipped.

Volt intends to lease these vehicles to its corporate customers based in the Middle East and Gulf States. Current Volt clients include UPS, DHL and FedEx throughout the Gulf Cooperation Council (“GCC”) region, which includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE).

Volt’s vehicle order is being assembled at Mullen’s Tunica, Mississippi-based Commercial Vehicle Facility, which is capable of producing 20,000 Class 1 and 6,000 Class 3 vehicles annually with two production shifts.

Founded in 2020, Volt quickly established itself as one of the largest and most influential commercial EV leasing companies in the region. Volt’s vehicle portfolio includes 17 models with focus on light, medium and heavy-duty electric vehicles. Volt leases vehicles to corporate customers providing first to last-mile delivery for fast moving goods and provides heavy duty trucks for shuttling service across the region, serving clients including large transport businesses under a long-term secured leasing model.

“We’re happy to announce we have shipped the first vehicles under our contract with Volt. Our team from Mullen will meet the vehicles in Dubai to support the launch with Volt,” said David Michery, CEO and chairman of Mullen Automotive. "Following our expansion in Europe, this partnership marks another major milestone as we continue to grow our commercial EV business globally and deliver sustainable transportation solutions to customers worldwide."

Mullen’s commercial EV lineup includes the Mullen ONE Class 1 EV cargo van, the Mullen THREE Class 3 EV cab chassis truck, and the Bollinger B4 Class 4 and Bollinger B5 Class 5 EV cab chassis trucks from its subsidiary, Bollinger Motors. Mullen’s full lineup of commercial EVs are purpose-built to meet the demands of urban last-mile delivery; available for sale and in full compliance with U.S. Federal Motor Vehicle Safety Standards, the Environmental Protection Agency and the California Air Resources Board (“CARB”) certifications, denoting strict adherence to clean air emissions standards. The Bollinger B4 begins Start of Production on Sept. 16, 2024, with deliveries beginning in October 2024.

About Volt Mobility
We are unwavering in our commitment to sustainability, and we firmly believe in the potential of electric mobility to revolutionize industrial transportation. Our steadfast commitment aligns seamlessly with the transformative potential of electric mobility in the industrial sector. By leveraging the latest technologies, we strive to create a cleaner, more efficient and seamlessly connected transportation network tailored for industrial applications. Whether you operate in logistics, manufacturing or any industrial sector, Volt Industrial Mobility is your partner in driving positive change. Join us as we work towards a future where industrial electric vehicles play a pivotal role in creating environmentally conscious, high-performance and cost-effective transportation solutions.

To learn more about Volt, visit www.VoltMobility.group.

About Mullen
Mullen Automotive (NASDAQ: MULN) is a Southern California-based automotive company building the next generation of commercial electric vehicles (“EVs”) with two United States-based vehicle plants located in Tunica, Mississippi, (120,000 square feet) and Mishawaka, Indiana (650,000 square feet). In August 2023, Mullen began commercial vehicle production in Tunica. In September 2023, Mullen received IRS approval for federal EV tax credits on its commercial vehicles with a Qualified Manufacturer designation that offers eligible customers up to $7,500 per vehicle. As of January 2024, both the Mullen ONE, a Class 1 EV cargo van, and Mullen THREE, a Class 3 EV cab chassis truck, are California Air Resource Board (“CARB”) and EPA certified and available for sale in the U.S. Recently, CARB issued HVIP approval on the Mullen THREE, Class 3 EV truck, providing up to a $45,000 cash voucher at time of vehicle purchase. The Company has also recently expanded its commercial dealer network with the addition of Pritchard EV, National Auto Fleet Group, Ziegler Truck Group, Range Truck Group and Eco Auto, providing sales and service coverage in key Midwest, West Coast and Pacific Northwest and New England markets. The Company also recently announced Foreign Trade Zone (“FTZ”) status approval for its Tunica, Mississippi, commercial vehicle manufacturing center. FTZ approval provides a number of benefits, including deferment of duties owed and elimination of duties on exported vehicles.

To learn more about the Company, visit www.MullenUSA.com.

Forward-Looking Statements
Certain statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact may be deemed forward-looking statements. Words such as “continue,” “will,” “may,” “could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, but are not limited to, statements about our plans, expectations and objectives with respect to the purchase agreement with Volt, the anticipated purchase and delivery of vehicles and expected revenue. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of Mullen and are difficult to predict. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. These forward-looking statements are subject to a number of risks and uncertainties, including but are not limited to, uncertainty that Volt will abide by its contractual obligations, including payment of the deposit and order of vehicles as expected, the timing and dates for receipt of payments pursuant to the agreement, successful certification of the vehicles in the GCC region,  delays in production and delivery of vehicles, unanticipated returns of vehicles, delayed commercial product launches and the achievement of operational milestones, and changes in domestic and foreign business, market, financial, political and legal conditions that may affect incentives and the general market for EVs. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed by Mullen with the Securities and Exchange Commission. Mullen anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. Mullen assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law. Forward-looking statements speak only as of the date they are made and should not be relied upon as representing Mullen’s plans and expectations as of any subsequent date.

Contact:
Mullen Automotive, Inc.
+1 (714) 613-1900
www.MullenUSA.com

Corporate Communications:
IBN
Los Angeles, California
www.InvestorBrandNetwork.com
310.299.1717 Office
Editor@InvestorBrandNetwork.com

Attachment

• UAE-based Volt Mobility Recently Agreed to Purchase 3,000 Class 1 and 3 EV Cargo Vans and Trucks

FAQ

What is the value of Mullen Automotive's contract with Volt Mobility?

Mullen Automotive has secured a $210 million purchase contract with Volt Mobility for 3,000 EV cargo vans and trucks.

When did Mullen Automotive (MULN) ship the first vehicles under the Volt Mobility contract?

Mullen Automotive shipped the initial commitment of commercial EV cargo vans and trucks on September 2, 2024.

How many vehicles is Mullen Automotive (MULN) planning to ship to Volt Mobility in 2024?

Mullen Automotive plans to ship 300 vehicles to Volt Mobility in calendar year 2024.

When will Mullen Automotive (MULN) start recognizing revenue from the Volt Mobility contract?

Mullen Automotive will begin recognizing revenue from the Volt Mobility contract in fiscal quarter 1, starting October 1, 2024.

What is the production capacity of Mullen Automotive's (MULN) Tunica, Mississippi facility?

Mullen's Tunica, Mississippi facility can produce 20,000 Class 1 and 6,000 Class 3 vehicles annually with two production shifts, totaling 26,000 vehicles.