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Watch PreMarket Prep's Interview With The CEO And CFO Of Electrameccanica

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Watch PreMarket Prep's Interview With The CEO And CFO Of Electrameccanica

ElectraMeccanica Vehicles Corp. (NASDAQ: SOLO) announced Thursday morning a new retail location in Oregon. Shortly after the announcement, CEO Paul Rivera and CFO Bal Bhullar were a guest on Benzinga's PreMarket Prep to discuss the retail expansion and much more.

New Retail Location: ElectraMeccanica will open a new store in the Washington Square Mall, approximately 18 miles from Portland located in a prominent suburb, Rivera said. This was part of management's "very methodical" approach in building out a retail presence by first focusing on Southern California, followed by Arizona and then Oregon.

Shift In Strategy: ElectraMeccanica's roots trace back to being a three-wheeled car that targeted the single-occupant commuter, the CEO said. But as time went on, the company recognized the potential in expanding to fleets and utility applications along with ride-sharing. This would expand ElectraMeccanica's target market to include food delivery, police and security, among others. The vehicle would still retain its all-electric features with a 100-mile range, 80 mph top speed, and all the same comfort and safety features.

Watch to the full interview with ElectraMeccanica CEO Paul Rivera and CFO Bal Bhullar in the clip below, or listen to the podcast here.

Production Update: ElectraMeccanica is currently in the pre-production phase and will transition to the production cycle this summer, Bhullar said. What started as a vision and a dream in 2015 will become a reality in the very near future.

"It's going to be a big momentum shift in terms of where we are going to be," she said.

The company can produce up to 20,000 vehicles per year out of its facility in China but this level of full-production capacity won't come for a little while, Rivera said.

Near-term priorities not only include making sure the engineering is done correctly but the customer engagement model is appropriate.

"Our retail footprint is very unique, it's just a pop-up retail location so we don't have a big, heavy brick and mortar storefront kind-of approach," Rivera said. "It's an incomparable vehicle with an incomparable launch strategy in a very asset-light production strategy. But it's all about getting it right in a very slow, methodical ramp-up."

As a policy, the company isn't providing any production or delivery guidance at this time and will do so eventually, Bhullar added.

Balance Sheet Update: ElectraMeccanica spent the past few months de-risking its balance sheet and the company now has $51 million in cash. This puts the company in a much better position to work on a "distinct pathway to success" as part of a 12 to 18-month strategy.

Stock Price Commentary: The electric vehicle market as a whole is a hot space and Electrameccanica's followers recognize the company is close to entering production and simultaneously expanding its retail footprint, Rivera said. Investors also realize Electrameccanica has something unique to offer in a post COVID world that is also fun, exciting, and trendy.

"There are lots of compelling reasons why this vehicle and our stock should be exciting right now," Rivera said. "This is exciting."

Made In America Plan: ElectraMeccanica started looking for a U.S. assembly operation across seven states and has now narrowed the process to four states, Rivera said. The company wants to make use of a global supply chain to de-risk itself from China and mitigate the impact of tariffs.

The company plans on updating investors over the next few weeks what states are in the running and a final decision is expected by Thanksgiving. Construction on a new facility is expected to start in early 2021 with the objective of becoming functional by the end of the year.

PreMarket Prep is a daily trading show hosted by prop trader Dennis Dick and former floor trader Joel Elconin. You can watch PreMarket Prep live every day from 8-9 a.m. ET Benzinga's YouTube channel, and the podcast is on SpotifyiTunesGoogle PlaySoundcloudStitcher and Tunein.

 

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