REE Automotive .(US:REE)2024-05-30 15:17Financial Data and Key Metrics Changes - The company ended Q1 2024 with liquidity of $77.5 million, which includes cash, cash equivalents, and short-term investments, along with a $15 million long-term credit facility [65] - GAAP net loss for Q1 narrowed to $25.2 million, a 29% decrease quarter-over-quarter and a 12% decrease year-over-year [66] - Non-GAAP net loss decreased by 33% quarter-over-quarter to $21.7 million and decreased by 10% year-over-year [66] - Free cash flow burn continued to decrease in Q1 2024 with a 6% reduction quarter-over-quarter, consistent with a 25% year-over-year decrease in full year 2023 [66] Business Line Data and Key Metrics Changes - The company commenced deliveries of the world's first full by-wire, software-driven, certified medium-duty demo trucks to customers across North America, including major fleets like U-Haul and Penske [52][53] - The order book is valued at approximately $50 million, representing orders from dealers and fleets [56][14] - The company has delivered five vehicles to date, with expectations for more deliveries as production scales [9] Market Data and Key Metrics Changes - The company is experiencing strong demand in the commercial vehicle segment, with a noted difference in adaptation rates compared to the passenger vehicle segment [16][17] - The market response to the Powered by REE and REEcorner technology has been very positive, indicating potential leadership in the commercial vehicle segment [55] Company Strategy and Development Direction - The company's go-to-market strategy focuses on "complete, not compete," working with large fleet operators and automotive manufacturers [53] - The company aims to ramp up production and deliveries to meet the growing demand for electrification in the commercial truck market [62] - The operational focus for the year includes managing a smooth transition into ramping manufacturing and deliveries [62] Management's Comments on Operating Environment and Future Outlook - Management believes that the majority of the heavy lifting is behind them, with expectations for achieving bill of material parity upon production in the low hundreds of vehicles and EBITDA breakeven in the low to mid-thousands [63] - The company is evaluating working capital financing options to scale production effectively [64] - Management expressed confidence in the potential for follow-on orders from early customers, which will be crucial for scaling production [36] Other Important Information - The company has been selected by Airbus to develop and validate a fully autonomous program based on its full by-wire technology, further solidifying its technological leadership [61] - The company expects to generate cash from the UK government as part of a grant plan, amounting to roughly $7 million between Q2 to Q3 [38] Q&A Session Summary Question: What are the priorities this year regarding unit deliveries? - The company aims to fulfill its order book and deliver as many vehicles as possible to large fleets like Penske and U-Haul, which have significant potential for future orders [71] Question: How are customers evaluating the product for follow-on orders? - Different fleets have varying criteria for evaluations, but positive feedback from demo rides indicates strong potential for follow-on orders as customers experience the technology [35] Question: What is the expected impact of the U-Haul and Penske agreements? - The partnerships with U-Haul and Penske are expected to significantly impact sales, with the company confident that these relationships will translate into orders over time [72]