REE Automotive .(REE)2024-12-17 15:36Financial Data and Key Metrics Changes - REE Automotive reported a significant increase in liquidity, totaling 38.5 million, compared to 24.1 million in Q3 2023, primarily due to non-cash remeasurement of warrants and derivatives [33] - Non-GAAP net loss in Q3 was 12.4 million in Q2 2024, with a decrease of 1.3 million when excluding the previous quarter's R&D tax credit [34] Business Line Data and Key Metrics Changes - The number of reservations for the P7 trucks increased by 230% quarter-over-quarter, reaching 137 million, representing over 900 P7 EVs from 30 different customers [22] - The company is on track to deliver the first P7 trucks to North American customers in the first half of 2025 [16] Market Data and Key Metrics Changes - There is a growing demand from fleets and OEMs for REE's products, with a notable shift towards software-defined vehicles (SDVs) as legacy OEMs seek to regain market share [10][27] - The commercial vehicle market is experiencing a severe driver shortage, making autonomous driving a compelling solution for fleets [11] Company Strategy and Development Direction - REE's strategy focuses on collaboration rather than competition, allowing legacy OEMs to integrate REE's SDV technology into their product lines [10] - The company aims to achieve bill-of-materials breakeven in the second half of 2025, with production ramping up to a few hundred vehicles [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to meet growing demand and deliver high-quality products, supported by partnerships with Motherson and Roush [14] - The management team is optimistic about generating software-related revenue and improving margins in the mid- to long-term [11] Other Important Information - The company has established a service network across North America with 80 sales and service points to support its commercial EVs [60] - REE has secured up to 33 million in credit facilities from top-tier banks to support its working capital needs [31] Q&A Session Summary Question: What contributed to the 137 million in reservations? - Management noted that the surge in reservations is linked to the partnership with Motherson and Roush, which has increased customer confidence [43] Question: Can you elaborate on Motherson's role in supply chain optimization? - Motherson is overseeing about 50% of the supply chain and is producing key commodities, which is expected to increase as production ramps up [50] Question: What is the expected cash burn in 2025? - The anticipated average monthly burn is between 6 million, with higher spending expected in the first half of 2025 as production ramps up [55] Question: Is there a service network set up in the U.S.? - Yes, REE has established a service network with 80 sales and service points across the U.S. and Canada to support its vehicles [60] Question: How does the company view the impact of tariffs and incentives? - Management believes there will be minimal impact from tariffs, as the product offers a strong total cost of ownership, and tax incentives play a lesser role in commercial vehicle demand [66]