REE Automotive (REE) 3 Mar 222021 Q4 Earnings call transcript

Greetings and welcome to the REE Automotive's Fourth Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the opening remarks. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to Limor Gruber, Vice President of Investor Relations. you. Thank

begin. may You

actual that assume to morning plans, thank be include call. for statements have our goals, We which filing forward-looking and uncertainties earlier could call may press which and quarter reasons, like seen different publicly our prospects results Please risks company's recent projections, expectations, by forecasts XXXX statements update from release would SEC, this our issued deck as conference beyond principal are such any today's forward-looking hope for and our the statements many note identify forward-looking the Any by that obligation other forward-looking statements. control. no describing may investor investors.ree.auto. law. except you you are to remind you, beliefs, strategies, I of our the joining results. anticipated Please see a affect all fourth statements. We our at required variety and with of business, Thank and assumptions that that you future

In adjusted addition, filings loss of non-GAAP comparable GAAP non-GAAP be we non-GAAP certain release and EBITDA, our Please measures EPS. see net their for measures today, a or most directly non-GAAP and providing financial will reconciliation to including these discussing measures.

Daniel. update, and I will Joining call our will me operations on today as David turn an this well outlook. overview provide Officer, who with our please. to is At point, Chief of and financial continue Barel, and discussion Goldberg, our an over as the Co-Founder our Daniel the Daniel, business give results will Executive who CFO,

financials a call call. begin with initiatives few and Goldberg, welcome on our morning fourth months. last to Good follow and progress CFO, the quarter Then discuss on the the XXXX Limor. strategic our I fourth outlook. earnings an of our quarter achieved recap will milestones the many on company's the you, in new update our and will with David Thank

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Following on validate advanced that, we expect public to obtain and roads prototypes purchase orders.

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approach, delivery market, existing our Vehicles on commercial we of lower commercial commercial our vans, ownership enterprise. ultimately on leads value rapid light segment electrification of of the cost commercial compelling duty focused proposition mid modular fleets, segment to Regarding and differentiation total and the which vehicles. of focused We're to skilled and of Commercial any programs, including because our a customers, this trucks vehicles, are for the

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future owners stripped global freedom partners. specific design solutions, deliver REE take chassis equipment. design for For network chassis also vehicle for can cabs proof for manufacturers or automotive can speciality other a dimensional mission fleet and REE's of full with needing Upfitters looking maximum flexibility full

and logistics the with product major is number company, durability programs of have global operational on and a One We of their specification functional counterparties. cycle. based PX validation ongoing several a including

vehicle prototype XXXX. roads We on this mid to in expect full in private test a U.S. customer the

validation The which for private other top road to are programs two with strategic mid hats send EAVX collaboration which we to upfitting advanced earlier, started mentioned XXXX. our prototypes for I in

commercial trucks, we and a agreement vehicles. with The buses, electrified other recreational walk-in vans, a class X vehicle development major commercial which for platform is joint OEM our with school developed

vehicle OEM and to for development to EV it joint the REEcorner into REE new for chassis. global the agreement REE dedicated During a supply phase, enter supply commercial expect

towards validation We mid U.S. to full pipeline program. UK first with year. expected to private our the XXXX of in customers providing the for The prototypes road and vehicle the expect end FlatFormer orders in start the

leader medium to Motors, in chassis. platform, The our flat The FlatFormer can thus from customized detached wheel the services. REE's Mobility as unit program. Module at a modular Leopard operated REEcorner in will and reside and FlatFormer independent and is can technology, REE the platform serve the on the be be capable its EV fully wheel innovative Model that FlatFormer and between chassis, Mobility leaving Vegas that FlatFormer XXXX. Consumer detached the The Hino and heavy components Las Hino carry to next separately Show as The an past mission. jointly prototype duty can with passengers, is the housing be anticipate platform goods delivery within the a in trucks well. carrying standalone continue Service this Service easily leverages and produced of January. creating allows entire EV Electronics drive progressing with which global Together the we collaboration Hino exhibited concept Our a once

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properly the him David hand to to new REE team. introduce the Before call, and please him Goldberg, our allow me welcome I CFO,

all plan. industry have functions, critical on partnerships, a We're will may our Development. strategic Corporate highly he David business that us impact most of International, the counting and Senior company we on relations. served of from confident path Magna recently lead execute President financial REE's aspects tremendous Vice David where David joined you as as seen, to investor of As I'm have this David? recently

I to that excited believe and Daniel, will opportunities lie REE you, I'm good revolutionize for call technology today groundbreaking about market. the more everyone. morning, has EV ahead even developed here with this excited be Thank that REE. the and you on

commit to the a financial providing results unique in coming shareholders, market have know community our plans opportunity going I'm and the and REE company's over the approach as REE We plan. to a analyst quarters, getting our pivotal I well and growth joining at to transparency into forward. as look truly stage to certainly forward

of in then a quarter, share I'd results XXXX, discuss of expectations company's focus around to my fourth XXXX First, loss those XXXX. like $XX.X million our for quarter the perspectives the of $XXX.X to the GAAP The in net fourth expectations. compared for third million company on the and reported quarter

the founders vesting quarter, the granted expenses XXX technical required related its compared third the to of to impacted third $XXX performance stock XXXX As quarter Capital. discussed million of million the as loss $XX anticipated ramp our quarter to the to million the to last fourth company's to net Non-GAAP results were in and add based continue of we quarter increased $XX and of with options our by XXXX meet engineering staff timelines. merger programs prior in

As of the the was XXX and time to December the at year. beginning employees XX, of that full on number compares of a basis, XX

cash balance entirely $XXX.X of no totaled As comprised of December debt. cash XXXX, million XX, our and

are well advance described We have Daniel sufficient underway. R&D as programs execute earlier, as the funding efforts to to that other

spending, I cash our of this committed maximize to to close current cash at have timeline. launch we UK expenses. range execute our providing establishment line, mainly be our factory This of million range should portion invest execution production budgeted is present $XX of to well budget XXXX Center which but we to we the in related and Austin and transparency. The our Center. in XXXX, against will budgeting expect note of $XXX For to and to our capability, million capital Due effectively as both as operating REE's a concentrated Integration a plans internal million is primarily asset-light that to a on to inclusive expected the is its to REE model, enables path never as of Integration it in the we programs. production basis tied straight $XXX are

if scope, Similarly, as other With milestones existing expand Our costs OpEx it's the basis, well. additional out on programs to earlier comprised engineering to to time, and required plan will reference opportunities. spend convert may and being cash comment we technical out is spending get mostly MOUs programs a communicated. my if that against some budget deliver in accelerate important execute opportunities to pushed our we in our of get or require according or note to pipeline liquidity have timelines certain may pushed agreements to those on

our very focused that vast our of the towards allocated total budget programs, course of additional progress budget indicative unfolds. our extend but of I'll on ambitions to we the year cadence with have far is expectations and plan Having executing that, as The We will spending programs. majority our the the that, And be size on current addressable current comments. are our call of hand said given our market. update will shareholders back the Daniel beyond for of

Thanks, David.

Before call competitive active on rapidly what REE's touch has very and to the vibrant questions, like a become in up to I'd market. opening EV positioning

applies the process vehicle before, and significantly manufacturing said decades. both combustion by powered to for I've hasn't This vehicles. vehicles engines electric As changed in

between the to one. are substitution wheels still different the electric As an has vehicles which and components manufacturing. manufacturing the easy internal for on is the functionality. REE engine chassis, combustion constrains in fundamentally electric and of main adaptation approach of design modularity accelerates, The the difference an and

integrates Our REEcorner into components, a control critical between single chassis suspension, located wheel. compact and powertrain like steering, the module patented technology braking, vehicle the and

This interior shape, they platforms translates means people carrying vehicles can or Our to our boxes. serve greater And to products platforms fully decade build types, are That's the cargo in upon the higher means R&D are class conventional total are are capacity, provide into are efficiency designed as power built. Leopard which agnostic cost without and to why built. whether volumetric designed driving than of and flat shipping on that vehicles completely means the widely This space and cargo lower more foundation mode. to ownership or source investment of our a customers. of we return PX our between. Because applicable for and modular, all EVs

the the ground also that design continually Our are without improve rebuilding from our in able proof approach is future we modules to up. upon

would to imagine lie squarely and I express plan, that to my executing of While can't like vision. our this are not the but and we focused intend on partners it, I stakeholders gratitude get do that share opportunities and ahead business our help to ahead

you. Thank

the [Operator ahead, line begin today Hills is session. will go comes the Please We Greg Instructions] your from now question-and-answer line question first BTIG. of Your open.

Lewis the that's not I line, not? Greg Daniel, am on for I'm or if sure

line Your is open, sir.

great. Okay, morning, good hey, Hey, hey, good afternoon everybody.

Greg. Hi

which big clearly Thank think a hurdles process, expected you here for for execution few walk I year see in the XXXX to key guess, was be curious, updates. guess the of next you to I we homologation steps company us this months? going the kind year, I as through I as the you. the are is, some about about think Could them you start as is of

Right.

So very yes, lot look and I divide supply main homologation? we've XXXX one, side important of plans supply the into One demand side and a both for, for got to here for should categories. one the naturally. just referring that The on is XXXX I absolutely the two it. agree or would you on we side Were steps think to

Yes, correct.

it's on we're of U.S. slightly our for So and a technology. with past homologation, are few making right? different Europe process So homologation homologation progress the years and

be both and time the handing be In road we over ready it on on We a to of that progress on in homologated it, Europe in those body making lot and you Europe, are is governing where SOP the expect different process to the slightly a XXXX. U.S. than have fronts. fully naturally in oversees

us this hurdles not would that off point identified course homologation. in at take We have any

everything So on on schedule proceed is expected and to currently track.

Okay, great.

customer be, to feel? of because we we as over electric seems fuel have and fuel here are At on now. being interest solutions vehicle? electric the a then bullish battery vehicles battery, Okay, vehicles. mentioned just PX fuel either point, kind any trying more it for into cell that realizing Is sold battery do there at it while well least, this for understand as do going that, of we great. you as Just like is And kind battery we are cell term about think longer to cells, electric that

are points batteries source. to variety, of and I and is power to strong this one now is tend REE's agnostic a I think also agree. Yes, because we're Batteries and here

and different batteries, kinds So but not necessarily and also between batteries batteries, cells, fuel just of solid-state chemistries, different other.

the shortage Our think approach batteries but supply. lot accommodate range, to demand in suppliers hedging demand two the vehicle the from is see road. that, towards multiple class, of is only not a the of do main not down that, we market, more and that That fuel in against that in performance of batteries, in kinds gives is we and multiple business. lot us are end and for but one we a step that meaning again, what of can different we agnostic that's chemistries of third configurations. gives if but usually fronts, the step terms high cells, of second the naturally the Having the it side But technology flexibility see located said more heavy longer I us

you're to start Okay, fuel electric so think put bulk like for sounds not mouth, to XXXX, in the we more it demand vehicles cells? opposed your that to is words but I as mean, XXXX about seeing, and as of

Correct.

very you Okay, perfect. much. Thank

you. Thank

you. Thank

of open. is comes go Sheppard from line question Fitzgerald. Andres line Cantor ahead, next your from Your the Please

Daniel. you hear okay? morning Hi, Can me good

Of morning. course, good

quick Good the couple on of me. from morning. quarter. are How you? A Congrats questions

year. up in to can color you end platform and you towards So flow and of a mentioned if XXXX? you just more order that us that see expect the translate the ramping terms the maybe could do that revenue you in the how PX give I'm have of wondering orders bit

Sure.

mission in a and enables So, first right? uptime are we efficiency, and customers tech And TCO. specific Those are of foremost vehicles. company vehicles our suited tech for best terms

the they tech orders, which to to and for plan the tech and firm Now, converting that's benefits. our and experience And its after to backlog the XXXX. large would basically benefit, those customers that need experience means lead pipeline

XXXX started last provide all those Once and differentiation, strong reported evaluations be customers its to forward. So continue us we have and first we've and place prototypes for so allow with end the to of already next same orders benefits have will XXXX. customers experienced technology, those at would phase we of to them to in one the for the year the the move doing

to point, And add another just XXXX. in I work revenues guess for capacitizing

this capacity come the that or to So going beginning orders in in of have would year, XX,XXX end towards the sets for XX,XXX XXXX. we're

I'm changes referenced that very if us helpful. an total it? maybe the you update any one in you Thanks, May Got programs sign quick be guys. the agreements past, wondering can XX followup. the had give That's customer on or pipeline? to

progress and on index that continue focusing more we be would pipeline. Yes, on onwards firm that for the think continue make be into do for I us we to to important XXXX it that develop orders. to converting

with So to and as shared that you of that build and very mid we've OEM continuing commercial today, Class Xs. more growing we've we for partners, with year, course, and as earlier bring pipeline signed a global large last well in also, are

get but to conversion this towards the So on factor and the that going on. want of the to to year that year, believe into continue what important think for the of that's again, company end the is backlog pipeline is the I execute focus we growing, I

Great, very it I'll much, thanks Daniel. you. on. Thank pass

Sure.

Thank you.

open. go question of from Your Jeff line comes the Cowen. your is next from ahead, line Please Osborne

Jeff is for this afternoon. guys, Good Shawn Hey, Osborne.

Hi, how you? are

Hey I'm guys. taking afternoon, Good good. my for questions. Thanks

question, opposed UK the online first is the Integration to planned the XXXX. as initially for Center So I'm XXXX that in now coming seeing

it is vehicle perhaps categories can you seeing somewhere So to faster what infer you can from that else? for in are seeing delivery And of talk about one Europe that, delivered like going there? be growth demand or you're kind

you are correct. Yes, so

from our have Europe. on accommodate Center to European faster demand We Integration moved

the of production So and U.S. we for will and two for have integration XXXX, Europe, the for one one centers running up

very close disciplined asset-light way, having where integration incremental those are and customers. our whole needed. idea CapEx and centers on quickly to key a light in strategic XX were focusing up The manufacturing months are to we within to our as XX to them behind rather commissioning volume able the from close strategies, adding We building customers set integration we centers

ahead there the one, kind the particular a So your in delivery it of American reason the is going North one just off of in America European be why coming seems is right? North would like timeline first

The at Right? first delivery for et will we modular see The delivery a aimed builders, program. global be a program demand PX is It's PX top the and hat companies, very shuttles, on cetera. platform. it. track, few That is OEMs, rather autonomous

So available will and be it Europe U.S. both in the

joining like a years? revenue with Understood, on, next in like autonomous as are last in of coming your saw you thanks up, you how I in in from can Navya a your upon like few you perhaps the perhaps so standpoint or announced much. autonomous they're and mention And development And Navya touch can general? follow that in from is week revenue so just moving fraction where what

So, our really near opportunity vehicles on the the I autonomy. much near-term see drivers. or mean, is five a as term very with significant over tied is to that actually We four long-term. not But level focus

bit further away, said, all like volume. terms autonomy. are course, in perfectly REEcorners system. it's regulations Now, both But, a terms in and little for market think autonomy by is just wire David go to wire and of nonetheless, that Therefore, of the and of it's REEboards we timing, suitable

PX, focus driven the is be should say driven humanly autonomously. main we but PX or yes, also the our So can

Thank I it. it. much you so Got appreciate guys,

you. Thank

you. Thank

Davidson. next Your comes question Mike from Shlisky ahead. go Please DA from

Your line is open.

about where to Hey, should you’re had it process, good ask EAVX I mentioned, and to What for OEM that are the than the quickly, it with. are that, a think jointly sorry, before course really now? to I Did was morning, you your end comments has person sale, of they selling and first also different approach end sounds were the be I user. changed, responsible working more global Yes. heard wanted like sounded you like final the That the interpret say. to involved those user. the guys allowing like seems or or wanted still jointly, good sales guys you'll I the be yes it have going to for facing or they afternoon, quickly ask the that EAVX I be you you OEM vehicles

is change strategy a we in do since think don't I communicated what before, philosophy not we've and we our that there Yes. complete, compete.

therefore, mean as partners our and very to Poindexter go as at by few and of market So a technology we EVAX to for body us REE. unique able is fact are developed factor working we work the Nonetheless, like them, builders we're important And course, alongside to together. power them well from actually a REE that with a in OEMs, are very and, with together based to the a on battery. and certain for asking customers customer with differentiator I the becoming is way holistic programs there a them a partner times very strong OEM points, work all market, the in pool the or up to certain where product provide in few

remain we just So, the same, expands the strategies as go. it

the that. it, want any only for of dozen might year? it for is few is in also that there maybe got globe of the that ask be challenge current I Okay, the sense chain supply situation hundreds, large your vehicles, you've do suppliers it Is today. In two-part a to any XXXX, the the question a got plan here you deliver have products Thank a make? or quantities for to you about it. to or that a facing you number got of kind

year. of that well. supply a We year as chain Quite prototypes developing don’t bit started challenges in has last see this any already

bringing base I been, we’ve two gearing, the been chain have We for consumer/customer very past years pipeline. and think, up the and up building in our disciplined supply

on on them customers, got everything its is that in full benefits. order for the we’ve the need customers this a the to year in So, and we put vehicles order experience vehicle to technology

obtaining the is Great. the is Integration building need Do time about be need equipment And up or you actually that any them to that UK. Austin you of Centers, to with of the still plenty install you other before actually have there part the and question issues functional?

hopefully, So are see. in they're no and to which the yes, Coventry experience lines, are that Keep and think those the it you guys I UK summer are that would we on how delays we invite some mind see to relatively track. robotics There AGVs, both Austin looks so asset-light. love are in over, integration There centers, and assembly like. those in

capacity said for that centers. towards the be those Having we will in We said, even probably SOP, that, agreements have expected the those is need, and we we so and XXXX, SOP operational like need the that beforehand. have signed David robotics equipment

Okay. much, Thanks Daniel. leave there. it I'll so

Thank you.

Thanks Mike.

There the you. are pass back. further no phone will questions lines. the call Thank I on

Thank you, Sharon.

we I platform, go our this to questions question like to the platform we quarter. last would read the understand conclude, that Q&A market from the would strategies launched Before better. to And investor like

So actual it here partnership? is soon goes, keeping order an company anytime having the or is with

that along said Yes, I answer the of lines before. is something the what we've think to

approach again pipeline that's to us large we've into REE, that's full and expect year to orders earlier, firm enable also validate time after and that's communicating track. experience get our the customers time everybody, rather would end initial prototype process by its powered and benefit. current, As -- the the convert on vehicle technology by explained we so the that's a the we of pipeline I This think backlog been over our for

Daniel. Thank very you much you, Thank everyone.

Bye, to Looking touch forward bases. bye.

Thank all. you,

concludes participating. call. Thank you for conference today's you. Thank This

disconnect. now You may