AYRO(US:AYRO)2021-03-30 16:00Vehicle Specifications and Manufacturing - The AYRO 411 Fleet has an expected range of up to 50 miles and a maximum speed of 25 mph, with operating costs approximately 50% lower per year compared to similarly sized gas-powered trucks/vans [15]. - AYRO has a manufacturing capacity of 400 AYRO 411 vehicles per month, with an assembly time of 12 man-hours per vehicle [25]. - The AYRO 411 Fleet includes multiple models, such as the 411 Flatbed truck and 411 Cargo Van Box, catering to various utility needs [16]. - AYRO's vehicles provide an approximate 49% reduction in operating expenses and a 100% reduction in CO2 emissions compared to a standard Ford F150 pickup truck [46]. - The AYRO 411 Fleet includes electric, four-wheel compact utility trucks with a maximum speed of 25 mph and an expected range of up to 50 miles, offering operating costs approximately 50% lower than gas-powered vehicles [15][16]. - The company is currently developing a next-generation three-wheeled electric vehicle, expected to begin manufacturing in the first half of 2022 [18]. - The company is focusing on reducing supply risk for its next generation three-wheeled vehicle by using as many commercial off-the-shelf (COTS) components as possible [58]. Partnerships and Agreements - The company has entered into a five-year Master Procurement Agreement with Club Car, granting Club Car the exclusive right to sell AYRO's four-wheeled vehicles in North America, contingent on annual orders of at least 500 vehicles [26]. - AYRO's partnership with Cenntro allows for the import of semi-knocked-down vehicle kits, enabling rapid market entry without significant capital expenditures [23]. - Club Car and AYRO Operating have a Master Purchase Agreement (MPA) for vehicle orders, with an initial term of five years starting January 1, 2019, and a right of first refusal for sales of 51% or more of AYRO's assets [27]. - AYRO has entered into a Master Manufacturing Services Agreement with Karma Automotive for the assembly of AYRO 411 vehicles, with a total payment of $1.2 million, of which $0.52 million was paid at closing [28]. - The company entered into a 12-month Karma Agreement for manufacturing services, with a total compensation of $1.2 million, of which $0.52 million was recorded as prepaid expense [57]. Market Opportunities and Trends - The global low-speed electric vehicle (LSEV) market was valued at approximately $2.4 billion in 2017, with sales expected to reach 1.5 million units in 2021 and a projected compound annual growth rate of 10.8%, reaching $8.9 billion by 2024 [40]. - Food delivery services are expected to grow over 20% per year, with an anticipated market size of $365 billion worldwide by 2030, creating demand for AYRO's next-generation delivery vehicles [52]. - The AYRO 411 Fleet is targeted at over 1,800 higher education campuses in the U.S., each with over 10,000 students, representing a significant market opportunity as campuses transition to electric vehicles [51]. - The last mile delivery service has seen exponential growth due to the rise in online ordering and e-commerce, making it a key differentiator among retailers [54]. - The U.S. electric vehicle market is projected to grow significantly, with the low-speed electric vehicle market expected to reach $8.9 billion by 2024, growing at a compound annual growth rate of 10.8% [40]. Financial Performance and Risks - AYRO has a history of losses and has never been profitable, with expectations of incurring additional losses in the future [8]. - The company relies on a single third-party supplier in China for sub-assemblies, which poses risks related to supply chain disruptions [9]. - AYRO's proprietary designs are susceptible to reverse engineering, which could impact competitive advantage [9]. - The competition in the automotive industry is expected to intensify, potentially leading to lower vehicle unit sales and increased inventory, which may adversely affect the company's financial condition and operating results [49]. Intellectual Property and Compliance - The company has filed for multiple provisional utility and design patents, as well as trademarks for its name and logo, to protect its intellectual property [61][63]. - The company operates under stringent governmental regulations related to emissions control and safety standards, ensuring compliance with both federal and state laws [64][66]. Corporate Structure and Employee Relations - As of December 31, 2020, the company had 26 full-time employees and maintained good relations with them, offering industry-standard compensation [81]. - The merger with AYRO Operating resulted in former AYRO equity holders owning approximately 79% of the outstanding equity of the company post-merger [83]. - The merger was treated as a reverse recapitalization, with AYRO Operating being the accounting acquirer, reflecting its historical operations in the consolidated financial statements [85]. - The company offers industry-standard compensation and benefits packages to attract and retain quality employees [81]. Production and Operations - The production system follows a lean, cell-based manufacturing model, with daily metrics measured for assembly quality and shift efficiency [79]. - The company operates as a single reportable segment focused on the design, development, manufacturing, and sales of electric vehicles [81]. - The company currently leases approximately 23,927 square feet of office and warehouse space, with the lease expiring on March 31, 2027 [87]. - The company’s corporate headquarters is located in Round Rock, Texas [87]. - The company makes its annual and quarterly reports available free of charge on its website shortly after filing with the SEC [89].