Vicinity Motor Corp. Secures Expanded Order for 14 Additional Vicinity Lightning Electric Buses for Honolulu International Airport
Vicinity Motor Corp. has announced an expanded order, increasing from 4 to 18 Vicinity Lightning electric buses for the Daniel K. Inouye International Airport in Honolulu, Hawaii. This initiative, facilitated by Sustainability Partners and Soderholm Sales & Leasing, signals a shift from diesel to electric vehicles for the State of Hawaii Department of Transportation, utilizing the EVaaS program for financing. The electric buses will be the first 'Made in America' units produced at Vicinity's Ferndale, Washington facility, with delivery scheduled for 2024. This order underscores the appeal and versatility of Vicinity's electric bus offerings.
- Expanded order from 4 to 18 electric buses, increasing revenue potential.
- First 'Made in America' units, produced at Ferndale, Washington facility, boosting domestic manufacturing.
- Collaboration with Sustainability Partners and Soderholm Sales & Leasing enhances market presence and support.
- Hawaii's largest airport as a client, indicating significant market acceptance.
- Transition from diesel to electric vehicles supports environmental sustainability goals.
- Potential risks associated with the new 'Made in America' manufacturing process and possible production delays.
- Dependence on state and government-funded projects which may be subject to budget constraints or political changes.
Insights
The expansion of Vicinity Motor Corp.'s order to eighteen electric buses represents a notable contract for the company. This additional order helps to bolster Vicinity's revenue stream and demonstrates confidence in their products. The fact that these buses will be manufactured at the Ferndale, Washington facility means the company will benefit from potential federal incentives for 'Made in America' products. Financially, this deal could help Vicinity improve its revenue visibility for 2024, making it more appealing to investors looking for stable growth prospects.
Short-term, this order will likely enhance cash flow and reduce inventory costs as production ramps up. Long-term, this contract could establish a foothold in the U.S. market, potentially leading to more orders from other states or sectors. However, it's important to consider the relatively small scale of this order compared to the broader market for electric buses, implying that while significant, it may not be transformative for the company's financial position alone.
From a market perspective, this order of electric buses for Hawaii's largest airport aligns well with the increasing trend towards sustainable transportation solutions. As ESG (Environmental, Social and Governance) factors become more critical in investment decisions, this move underscores Vicinity Motor Corp.’s commitment to sustainability, which could be attractive to ESG-focused investors. The collaboration with Sustainability Partners LLC, a public benefit company, adds credibility to the company's ESG credentials.
Moreover, the use of the Electric Vehicles as a Service (EVaaS) model for financing this project is innovative, offering flexibility and reduced upfront costs to clients like HDOT. This could lead to wider adoption of Vicinity’s products as it lowers the barrier for entry. However, the reliance on third parties like SSL for long-term maintenance and technical support could introduce risks related to service quality and customer satisfaction, which investors should keep an eye on.
The Vicinity Lightning electric buses represent a significant step forward in transportation technology, particularly in the context of airport operations. These buses can help reduce emissions, lower operational costs and improve the efficiency of passenger transport at busy airports like Daniel K. Inouye International Airport. The use of a 'Made in America' tag not only enhances domestic manufacturing but also ensures compliance with federal standards, which could set a precedent for other transportation hubs.
In terms of technology, the successful deployment of these buses could validate Vicinity’s electric vehicle technology under demanding conditions, potentially opening doors for further adoption in similar environments. However, technology adoption always carries risks, including potential disruptions during the initial integration phase and the reliability of the new electric infrastructure. Given these factors, while the news is promising, it also warrants cautious optimism.
Order will be First ‘Made in America' Buses Manufactured at Ferndale, Washington Facility
VANCOUVER, BC / ACCESSWIRE / July 8, 2024 / Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC) ("Vicinity" or the "Company"), a North American supplier of commercial electric vehicles, today announced that it has received an expansion to its order from strategic partner Sustainability Partners LLC ("SP"), an ESG focused Public Benefit Company committed to eliminating deferred maintenance infrastructure by enabling sustainability, increasing it's initial order from four (4) Vicinity Lightning™ electric buses to eighteen (18) via Soderholm Sales & Leasing, Inc. ("SSL"), Vicinity's Pacific Islands distributor.
The 18 Vicinity Lightning™ electric buses will be used at the Daniel K. Inouye International Airport in Honolulu, the largest airport in the State of Hawaii serving 21 million passengers per year. The State of Hawaii Department of Transportation ("HDOT") will utilize SP's Electric Vehicles as a Service™ (EVaaS) program to finance the transition of the traditional diesel fleet to Vicinity's electric vehicles. SSL is facilitating the sale and providing long-term technical and maintenance support for the project. The expanded order for eighteen electric buses will be manufactured at Vicinity's Ferndale, Washington facility and is scheduled for delivery in 2024.
Brent Phillips, President of Vicinity Motor Corp., stated: "Hawaii's expanded Vicinity Lightning order is strong validation of the benefits of our right-sized and versatile product offering. This order will be manufactured at our state-of-the-art Ferndale facility, and the first buses to come off our ‘Made in America' assembly line. We look forward to providing our incredible all-electric bus solution to Hawaii's largest airport, leveraging SP's uniquely structured, month-to-month use-based service alternative to the traditional purchase of government fleets."
About Vicinity Motor Corp.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC) ("VMC") is a North American supplier of electric vehicles for both public and commercial enterprise use. The Company leverages a dealer network and close relationships with world-class manufacturing partners to supply its flagship electric, CNG and clean-diesel Vicinity buses, as well as the VMC 1200 electric truck to the transit and industrial markets. For more information, please visit www.vicinitymotorcorp.com.
Company Contact:
John LaGourgue
VP Corporate Development
604-288-8043
IR@vicinitymotor.com
Investor Relations Contact:
Lucas Zimmerman
MZ Group - MZ North America
949-259-4987
VMC@mzgroup.us
www.mzgroup.us
Neither the TSX-V nor its Regulation Service Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward-Looking Statements
This press release includes certain "forward-looking information" and "forward-looking statements" (collectively "forward-looking statements") within the meaning of applicable securities laws. All statements, other than statements of historical fact, included herein are forward-looking statements. Forward-looking statements are frequently, but not always, identified by words such as "expects", "anticipates", "believes", "intends", "estimates", "potential", "possible", and similar expressions, or statements that events, conditions, or results "will", "may", "could", or "should" occur or be achieved. Forward-looking statements involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.
Important factors that could cause actual results to differ materially from Vicinity's expectations include uncertainties relating to the economic conditions in the markets in which Vicinity operates, vehicle sales volume, anticipated future sales growth, market prices and supply for parts and materials, the success of Vicinity's operational strategies, the vehicle assembly facility in the State of Washington being capable of operating in the manner intended by management, the effect of the COVID-19 pandemic, the recoverability of the Optimal intangible asset and other macro economic factors on supply chain recovery to pre-pandemic levels, related government-imposed restrictions on operations, the success of Vicinity's strategic partnerships, the ability of the Company to extend or modify existing debt terms; and other risk and uncertainties disclosed in Vicinity's reports and documents filed with applicable securities regulatory authorities from time to time. Vicinity's forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. Vicinity assumes no obligation to update the forward-looking statements or beliefs, opinions, projections, or other factors, should they change, except as required by law.
SOURCE: Vicinity Motor Corp.
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