Lion Electric Q2 2023 Earnings Call Transcript

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Provided by Quartr
August 3, 2023

There are 11 speakers on the call.

Operator

Morning, ladies and gentlemen, and welcome to Lion Day Electric Second Quarter 2023 Results Conference Call. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference call is being recorded. I would now like to turn the call over to Isabel Ajayi, Vice President, Investor Relations and Sustainable Development.

Operator

Please go ahead, Ms. Ajayi.

Speaker 1

Good morning, everyone. Welcome to Lion's Second Quarter 2023 Results Conference Call. Today, I'm here with Marc Bedard, our CEO, Founder and Nicolas Brunet, our EVP and CFO. Please note that our discussion may include estimates and other forward looking information and that our actual results could differ materially from those implied in any such statements. We invite you to review the cautionary language in this morning's press release and in our MD and A, which contains important information regarding various factors, assumptions and risks that could impact our actual results.

Speaker 1

With that, let me turn it over to Mark to begin. Mark?

Speaker 2

Thank you, Isabella. Good morning, everyone. Today, we are pleased to share our Q2 2023 results and key updates that will shape our path to continued growth and profitability. 1st and foremost, we successfully closed earlier in July a $142,000,000 financing round, providing us with the flexibility needed to execute our growth plans for the foreseeable future. 2nd, we posted positive gross margins in Q2, which was largely driven by higher revenues and an increase in average selling prices.

Speaker 2

This also highlights our continuous tight control over the bill of material and other expenses. And finally, not only was Q2 a record quarter in terms of revenues, but we also improved truck deliveries. We will now provide color on each of these items before we open the line for questions. Let's start with our recently announced financing transactions. On July 19, we closed concurrent financing transactions, resulting in gross proceeds of $142,000,000 Simultaneously with these financings, we extended the term of our $200,000,000 senior credit facility to August 2025, and we also canceled our ATM program.

Speaker 2

With this key liquidity milestone behind us, we now have the required flexibility to execute our growth plans for the foreseeable future we continue our path to achieving profitability. In this regard, we are gross margin positive in Q2, definitely showing that our business model is scaling well and does not need extraordinary volumes to be successful. This positive gross margin is a significant step towards our overall objective of being EBITDA positive and generating free cash flow. Let's now delve into the details of our Q2 deliveries and our purchase orders. During Q2, we posted record quarterly revenue of $58,000,000 with the deliveries of 199 vehicles, including 33 trucks.

Speaker 2

14 of the 33 trucks delivered during the quarter were ordered by BOLT, a leader in sustainable logistics and a repeat customer for Lion. Note that the delivery of 50 additional school buses that were ready to be delivered to one of our customers and which the customer was ready to receive we've deferred until the final approval of the ZTF subsidy by the Canadian Federal Government. Delays were mostly due to this application being the first sizable order under the ZTF program to go through the final application process. We expect the subsidy to be approved and those vehicles to be delivered in the coming months, leading the way for several other deliveries on their ETF. In terms of purchase orders, our PO book consists of 2,559 vehicles, comprising 304 trucks and 2,255 buses, representing $625,000,000 Worth mentioning is an order from CAFU for 5 Line 5 trucks, which we launched in May it's slated for production before year end.

Speaker 2

Last, our Lion Inner GPO book stands at 275 charging stations and related services amounting to $5,000,000 which takes me to an update on the Joliet factory and the battery plant. On July 21, we officially inaugurated the Joliet manufacturing plant, the largest electric vehicle plant for medium duty and heavy duty vehicles in the United States. We were honored to host more than 500 attendees, including government officials such as Governor Pritzker, Senator Durbin and Senator Duckworth, as well as customers, analysts, climate change advocates, community and policy leaders. They all reiterated their commitment to Lion and the EV sector, which has further demonstrated by funding programs such as the EPA Clean School Bus Program. Round 2 of the EPA program, which consists in $400,000,000 in grant funding opened last April.

Speaker 2

We are working closely with school districts and operators to help our clients secure grant funding under this program. This is just one example out of many others as we are seeing new programs and legislations, including in Texas, Michigan, Illinois among others. Back to our activities in Joliet. During the quarter, we continue to manufacture Lion's units for customer deliveries and continue the setup of school bus working stations and installation of equipment. Everyone on-site at the grand opening was able to realize that the building and all tenant improvements had been completed.

Speaker 2

We plan to gradually ramp up production in Joliet, including the start of Liongib production this year. Our objective remains to have a manufacturing we have a capacity of 2,500 school buses per year in Joliet at the end of this year. Regarding the Lyon campus in Mirabel, during the quarter, we transferred and installed an additional portion of the battery production line from JR Automation's facility and continue to ramp up the production of our battery packs. Our objective is to bring production capacity to 1.7 gigawatt hour per year by the end of this year. This will be enough to power approximately 5,000 of our vehicles in a mix of school buses and trucks.

Speaker 2

Our Line 5 truck, as well as our Lion C and Lion DISCO buses will be the 1st vehicles to feature our proprietary Lion battery packs. Our goal is to progressively integrate our Lion battery packs into our vehicles and gradually reduce reliance on 3rd party batteries. At the end of Q2, we had approximately 2,700 BMW battery packs in inventory. Nicolas will now further discuss our financial performance for Q2. Nicolas?

Speaker 3

Thank you, Mark. I will start with the recent financing. I will then comment on Q2 results, including an update on CapEx, I will conclude with our liquidity position. After the end of the quarter, we announced and post financing transactions resulting approximately $142,000,000 in gross proceeds. The financing includes a $74,000,000 5 year senior unsecured convertible debenture bearing interest at 13%.

Speaker 3

For this portion, we have the option to accrue and defer interest payments such that these payments accumulate to the amount that is owed and convertible into lion's shares. The debenture is convertible at a price of $2.58 per share, representing a 20% premium for the 5 days Ewamp at the Department of Transaction Announcement. The second tranche consists of CAD 9,000,000 or approximately US68 million dollars in 5 years senior secured non convertible debentures bearing interest at 11% that will be paid in cash on a quarterly basis. This group of investors was also issued warrants, entitling them to purchase 22,500,000 common shares at an exercise price of CAD 2.81 per share, representing the 5 day Ewap at the time of transaction announcement. This capital infusion provides us with the flexibility needed to execute our growth plans for the foreseeable future.

Speaker 3

Of importance to note, there are no additional financial ratio covenants associated with these financing. Concurrently with this transaction, the maturity of our $200,000,000 revolving credit facility was extended by 1 year to August 2025 and last but not least, the ATM program, which was set to expire in July 2024 was terminated. Moving on to our financial performance for Q2 2023. We achieved record quarterly revenue of $58,000,000 supported by the delivery of 199 vehicles, a substantial increase compared to Q2 2022 when we delivered 105 vehicles. Specifically, we delivered 166 buses and 33 trucks in Q2 2023 with 171 of these vehicles delivered in Canada 28 in the U.

Speaker 3

S. Our average selling price also trended upwards positively impacting our gross margins. As Mark mentioned earlier, the delivery of 50 additional buses that were ready to be delivered and for which the client was ready for reception was deferred until final approval of the Z ETF subsidy by the federal government is applied. We we expect the Z ETF approval to be obtained and the vehicles to be delivered in the coming months. During Q2 2023, we also continued to improve gross margins, reaching 0.7% due to the positive impact of increased sales volumes, product mix and higher manufacturing throughput.

Speaker 3

Adjusted EBITDA for the quarter was negative 9,700,000 marking a significant improvement compared to the negative $14,400,000 in Q2 2022. Addition to intangible assets, primarily related to R and D, decreased to CAD17,900,000 compared to CAD24,600,000 in Q2 'twenty two. Our total capital expenditures for the quarter decreased to $19,100,000 as compared to $44,300,000 in Q2 of 2022. Dollars 5,000,000 of these expenditures related to the Joliet manufacturing plant and $12,000,000 to the Lion Campus. For the remainder of 2023, we expect to incur a total of $26,000,000 in CapEx related to our 2 growth projects, namely $9,000,000 for the Joliet plant and $17,000,000 for the Lyon campus.

Speaker 3

We want to reiterate that for 2024, our capital expenditures are expected to significantly decrease as our large project related investments will be completed. Let's now move to Liquidity and Capital Resources. During Q2 2023, we received $8,000,000 in government loans related to the Alliance Campus Enrais 4,000,000 through the ATM program before terminating it in conjunction with the recent off rate. Approximately 2,000,000 the last ATM raise was settled after the end of the quarter. Furthermore, during Q2 2023, we received initial upfront rebate payments from the EPA of approximately $27,000,000 under the first round of funding of the program.

Speaker 3

As a reminder, we obtained 292 purchase orders in connection with the EPA Clean School Bus Program, most directly through vouchers filed by Lion and to a lesser extent, through applications made by free agents, which were converted into purchase orders of life. These purchase orders represent a total value of 105,000,000 as applications in respect of other orders are processed by the EPA, we expect to also be able to receive other upfront payments from the EPA. As of June 30, 2023, we had a cash position of $44,000,000 the borrowing base on our revolving credit facility stood at $124,000,000 of which $100,000,000 was drawn as at June 30, 2023. Taking into account the required reserves to avoid triggering certain covenants, this translated into immediate borrowing capacity of 8,000,000 thus bringing our immediate liquidity position to slightly above $50,000,000 at the end of the quarter. As previously mentioned, after the end of the quarter, received $142,000,000 in gross proceeds from the offering, providing us with the required flexibility to execute our growth plan.

Speaker 3

With that, I will pass it back to Mark for concluding remarks.

Speaker 2

Thanks, Nicholas. Before we open the line for questions, let me conclude by saying that with the financing behind us, we now have the required financial flexibility to execute our growth plans and continue to focus on achieving profitability. Last week marked 15 years of existence for Lion. And let me tell you that we are more excited than ever about the opportunities ahead. With now over 1400 vehicles on the road, having collectively traveled over 14,000,000 miles or 22,000,000 kilometers, Lion is in a unique position to continue to capture market share in the medium and heavy duty EV space.

Speaker 2

Thank you all for joining us today, and we will now open the line for questions.

Speaker 1

Operator, we will now open the lines for questions. I just want to ask you to limit to 2 the number of questions asked to allow other participants to ask their question. You can of course go back in the queue if you have any follow-up questions.

Operator

And we also remember to unmute the microphone when it's your turn to speak. Our first question comes from Mike Slifskey from D. A. Davidson. Mike, your line is now open.

Operator

Please proceed.

Speaker 4

Yes, good morning and thank

Speaker 5

you for taking my questions.

Speaker 6

Maybe I'll start off with a question about bus deliveries and the cadence going forward.

Operator

I

Speaker 6

guess, could you maybe give us an update as to how you feel that's going to progress in here? Do you see ongoing decreases quarter over quarter for the next couple of quarters? Or do you feel like the bus business at this The size where it follows the broader bus industry where in the Q4 and then next Q1 deliveries will taper off given schools are already in session.

Speaker 2

Yes. Good morning, Mike. Yes, with respect The buses, Mike, you've seen the trend in the previous quarters as well. And we've said it, I mean, we the goal is to increase the revenues and making sure we make profits. We're very proud of the that we're gross margin positive right now.

Speaker 2

I think that's the real goal. That being said, though, if you're looking at the order book and if you're looking also the results that we have with respect to the EPA and a lot of Canadian programs as well, we're doing good. We're doing good. So definitely, we see an increase in the revenues and the number of deliveries in the upcoming quarters, but that's going to be sequential though. I said it several times, it's not a switch that you turn on and off, but we definitely see a growth within the next quarters.

Speaker 6

Okay. My other question was about your experience center comments you had in that release. Opening up Joliet added one more experience center, I believe, to serve that area of the country. How built out is your experience since the network at this point, you have more you need to build in the somewhat near future and is there a large CapEx for each one as you build them out? Thank you.

Speaker 2

Yes. We have Michael, we have 12 of them right now. And for the foreseeable future, I mean, This is good. We do have experienced centers in most of the states that or many of the states that We are targeting the same thing on the Canadian side in many provinces. And I think your question was also

Speaker 3

Yes, on CapEx, I could take this one. Hi, Mike. I'd say it's quite minimal CapEx to open an experience center and we should be pretty nimble there. I think that what we need is to rent we'll lease a facility and then have just the required tooling to service the vehicle. So it's certainly not a significant amount of CapEx when we expand that we may expand that footprint.

Speaker 3

Of course, we're very mindful of capital spend and we'll only do so with material deployments.

Speaker 6

Okay, great. Those are my two questions. I'll pass it along. Thanks.

Speaker 2

Thank you, Mike.

Operator

Our next question comes from Dan Levi from Barclays. Dan, your line is now open. Please proceed.

Speaker 5

Hi. Trevor Young on for Dan today. Thanks for taking my question. And congrats on getting back to positive gross margin. I'm sure you have your sights set on the same for adjusted EBITDA.

Speaker 5

And I was curious if you could just give some directional indications on the bridge towards from here, how to think about it in terms of volume versus other factors?

Speaker 3

Yes. Hey, Trevor. Thank you for your question. Look, I'd say we're obviously, we're we had said it in previous calls, it's a number one objective here is to be profitable and get free cash flow positive. We demonstrated today some I think some significant progress towards this.

Speaker 3

There remains a lot of room for us to continue to improve on the volume of delivery on the ASP and on the margin, of course, while we're pleased with the trajectory, there can be some volatility along the wait, but we're very pleased with where things are heading. I think you're seeing that in the numbers this morning.

Speaker 6

Yes, we are. That's helpful. Thank you.

Speaker 5

And then just as a follow-up, I noticed the sequential decline in the Lion Energy order book. I was just curious if the extent to which this reflects deliveries on the order book. And then more broadly, how to think about the energy business in terms of how it breaks out between supporting buses and trucks or if it generally matches the vehicle order book?

Speaker 3

Yes. Look, the well, let's start with the second part of your question. The goal of the Energy business is to make sure that Clients are well taken care of in all aspects of the electrification of their fleet. And that's a key component where there can be some issues, not only that equipment, but also installing it right and coordinating with the utilities. And so that's why we handle that for clients.

Speaker 3

We have a quite a good hit rates in some markets and in other places and other vehicle classes clients will procure on their own and that's fine as long as it's well coordinated. I would say as part of the order book, this is something that can be that can have some more chunky orders. And so when we make those deliveries or when we get those orders, we see Some up or down swings and this is certainly not in our view a testament of the Change in the order book for the vehicles or change in the cadence of delivery, it's just really one snapshot at one point in time and we've had some sizable deliveries in the quarter For the charging infrastructure,

Speaker 7

is it?

Speaker 6

That's very helpful. Thank you.

Speaker 7

Thank you. Thanks.

Operator

Our next question comes from Rupert Merer from National Bank. Rupert, your line is now open. Please proceed.

Speaker 4

Thank you. Good morning, everyone. So I see the delay on the said ETF Funding. How good is your visibility into that approval process? And do you see this impacting any vehicles that you would plan to deliver in Q3?

Speaker 2

Well, thanks for your question, Rupert. Obviously, we will be very cautious about the timing of those deliveries going forward. We that was the first sizable order for School Buses under the ETF. And this is the reason for this delay right now. So it doesn't put into question the availability of those funds and the willingness of the government to fund those school buses, but it's really a matter of timing.

Speaker 2

So communication is very good with the Canadian government and the there was a lot of steps, let's say, to make to go to the final approval. And that's the reason for that. So I think now there's a very good understanding from all the parties involved. So we don't see that as being an issue going forward, but I think communication is key and we're very well aligned with them right now. And we're used to work with the Canadian government and also with the federal government as you see with the success we're having with the EPA.

Speaker 2

So going forward, we feel it's going to be a lot smoother.

Speaker 4

Okay. But no visibility on timing at this point.

Speaker 2

Well, it could take time, and this is something we cannot predict, but for us, it's really aligning the manufacturing schedule with the approval Of those funds, so this is basically what the focus for us going forward.

Speaker 4

Okay, great. And then secondly, you highlighted in your disclosures that some revenues were impacted by continuing global supply chain challenges. Can you give us a little more color on this? How many vehicles were impacted by these issues in Q2? And maybe you can give some color on what the specific supply chain challenges are today.

Speaker 2

Yes, Rupert, It's going a lot better. I mean, a year ago, we were saying that was the main challenge, right? Just trying to manufacture those buses and trucks, it's not. It's not anymore. I mean, we've been able to develop a network of suppliers, Tier 1 suppliers and a great redundancy of So we're very proud of that.

Speaker 2

And no big issue. I mean, we're not out of the wood yet with respect to the supply chain crisis, But it's going very well. So we don't see that as an impact, I mean, for us to be able to manufacture our buses and trucks going forward.

Speaker 4

Can you give us a sense on how many vehicles might be impacted by that issue are the issues?

Speaker 2

I don't think it's in a number of vehicles. I think it's really for us to be able to manage you know this overall supply chain crisis and we're doing pretty good. So no, there's I don't think there's any number of vehicles that were impacted by that.

Speaker 4

All right. I'll leave it there. Thank

Speaker 3

you. Thank

Operator

you. Our next question comes from Chris Sauter from B. Riley. Chris, your line is now open. Please go ahead.

Speaker 8

Hey, guys. Congrats on the margin part right here. ASP seemed to be a big driver here of the improvement given volume came down slightly, but we had the revenue improvement. Can you give a margin lock maybe from 1Q to 2Q with some of the puts and takes related to ASPs and efficiency and And kind of what's driving the ASP improvement? Is it U.

Speaker 8

S. Versus Canada, incremental trucks and just

Speaker 3

that would be helpful there. Yes, certainly. Hey, Chris. Nick here. Look, the every quarter delivery is a mix of the delivery our mix of big orders that we deliver into as well as vehicles with different options and in different markets be it Canadian, U.

Speaker 3

S. And this quarter was certainly we demonstrated an improvement in the ASP by number of things, having a more diversified full of clients that we delivered to by improving our delivery count in the U. S. And improving our truck deliveries as well. So I'd say All of the above in what you said.

Speaker 3

As you see though, we still have delivery count that's significantly weighted towards the Canadian market. We've talked about delivering vehicles with more options, more energy in the U. S. Market, including the EPA program. There's a lot of room to continue to grow that.

Speaker 3

And as well, there's a lot of room to continue to grow on the truck count. So we feel good about the ASP, but our goal is

Speaker 8

Okay. Got it. So stopwatch continue to improve as the UX mix continues to grow in the near term. But are there any is there kind of a cadence of incremental fixed costs around Joliet and Maribel a step up that could impact the gross margins on 3Q, 4Q. I just want to get a sense of what you were looking what you're talking about with Some of the potential volatility on the margin front.

Speaker 3

That's exactly it. Look, let's be clear that our goal is to continue to improve gross margin, but all margin and profitability. But the reason I pointed to some potential volatility is On the other side of what I just mentioned around the ASP improvement and the volume, the potential volume improvements as well, there are also more costs that we're undertaking with the as the Joliet plant ramps up, as the battery plant ramps up, these are I don't expect those to impact the long term trajectory, but in the short term they can cause some positive.

Speaker 8

Perfect. I'll hop in the queue. Thanks.

Speaker 3

Thank you. Thanks.

Operator

Our next question comes from Craig Irwin from ROTH MKM. Craig, your line is now open. Please proceed.

Speaker 5

Thank you. So it looks like CPA is going to only issue $400,000,000 worth of vouchers this year. Last year, they did well over $950,000,000 So the total number of school bus orders seems to be contracting, right, or at least the financial subsidy for U. S. Robust orders that we're tracking, how do you think that's likely

Speaker 3

to impact order book you do have

Speaker 5

help over the next year. And is the U. S. Market as important for your business as fees, subsidies from the Canadian authorities and other programs across the U. S.

Speaker 3

Hey, Greg. Nick here. So look, yes, we're very focused on round 2 of the EPA program, which is $400,000,000 we talked about it in the past. It's a different approach to it. It really is a RSP type application, that is going well.

Speaker 3

We're having some good dialogue and this round is closing late August with some indication of who will be awarded in Q4 and then formal awards in Q1. Same time, it is our expectation that there will be another EPA round in the tune of $600,000,000 for this year. They are talking about $1,000,000,000 a year the €600,000,000 we expect would be in the form of a rebate program as pretty much in the same form as we've seen in RAN-1. So we think there is more coming there. And there are more programs that are opening in a number of states, right, including in Illinois, for example, but it's just one among others.

Speaker 3

So just to wrap up on this, the U. S. Side of the business is a very important one for us. It's we view it as a very strong Area of growth potential and we're very focused on that.

Speaker 2

Thank you. That's all my questions.

Speaker 3

Thank you, Craig.

Operator

Our next question comes from Lianne Issin from Canaccord Genuity. Lianne, your line is now open. Please proceed.

Speaker 9

Good morning, everyone. Congrats on the quarter. Just a couple of questions from me. To start, can you discuss any opportunities that you see to Acquired battery and or module assets in the marketplace?

Speaker 2

You mean, Lianne, you mean from 3rd parties?

Speaker 9

Yes, correct.

Speaker 2

Well, we are as you know, we do have our battery factory. And basically, our intention is to rely less and less on the 3rd party battery packs Or modules, we're building our own modules, and we are buying cells from Tier 1 cell OEM, so it's that's the goal at Lion. We do have a capacity of 0.6 gigawatt hour right now. We're going to 1.7 gigawatt hour by the end of the year, and it's enough to put batteries on about approximately 5,000 of our vehicles on an annual basis. So we're good for now.

Speaker 9

Okay. Okay. That makes sense. And then just one more for me. Can you provide any color that can help us understand your updated strategy around continuing to bolster your liquidity position?

Speaker 3

Yes, just well, in terms of liquidity, the short of it is we believe we have the required flexibility to execute our plan for the foreseeable future with the rate that we just did. When you look at what we said about the quarter, we had over $50,000,000 of immediate liquidity at the end of Q2. That's our cash and the availability on the revolver, we closed a financing right after the quarter for 142,000,000 in gross proceeds, we expect we have other sources of liquidity that include upfront payments from the EPA, our government loan facilities. And in terms of just the CapEx program, what's really important here is that we have a remaining $26,000,000 to incur on the growth projects for the rest of the year, that leads us, as Markus mentioned, the 5,000 vehicles of capacity, both on the vehicle side and on the battery side. And we're very firm on that.

Speaker 3

The intention is to drastically reduce the CapEx in 2024. We do not plan to invest in further capacity growth and so the short of it again is that we believe we have the required flexibility to execute the plan and that's why we shut down the ATM program.

Speaker 9

Got it. Okay, great. That's all from me. Thanks so much.

Speaker 3

Thank you.

Operator

Our next question comes from Tian Larochelle from Des Garda. Tian, your line is now open. Please proceed.

Speaker 7

Hey, good morning and thanks for taking my question. I'll be speaking on behalf of Benoit. First, regarding the certification of your first double pack, you previously expected it would be completed in 2Q, but now called for final certification in the coming months. Can you please provide more color on what caused the delay? And so I want to build it out of the way, what are the next steps in terms

Operator

of integrating those businesses? Thanks.

Speaker 2

Yes. Good morning, Tian. We're at the end of the test and certification process on our battery packs and we it will be certified within Within the next few months, so we're still good. I mean, we're aligning with the need for our battery packs. And as you probably know, we will start installing them on the Lion 5 and after that also on the Lion C, on the Lion D and also on the Lion A tractor.

Speaker 2

So time wise, I mean, when we're aligning the need for those battery packs with the launch of our vehicles, the timing is the timing works perfectly, so no issues.

Speaker 7

Perfect. That's helpful. Thanks. And maybe we can see the news that it was announced that we cannot liquidating the assets on the Mortgraf Mill Power. I don't know if you wish to comment on it, but there is some development from the arbitration process regarding the back contract that you had with Romeo and does the liquidation change anything whatsoever?

Speaker 2

Well, it doesn't. As you know, at this stage, both the arbitration process with Romeo and the court case against Nicolas Motors are following their course. And you're right, Nicolas just announced on June 30 that Romeo is liquidating its assets. And basically, they're transferring the ownership of all of its assets. And there's some exclusions in there though.

Speaker 2

And they did that to a 3rd party assignee for the benefit of the creditors. And right now, we're basically evaluating all of our options in light of what happened. So basically, those two Processes, I mean, are just following their course right now as we speak.

Speaker 4

Perfect. Thank you very much for

Speaker 7

the color. I'll pass the line.

Speaker 2

Thank you, Dan.

Operator

Our next question comes from Sara Deer from BMO. Sara, your line is now open. Please proceed.

Speaker 10

Hi, everyone. Good morning. Just want to understand, like what trends are you seeing in the commercial truck market as in discussions with the customers. And the second one is we recently saw JB Hunt placing Class 8 Commercial Truck orders with Nicola. And will you know all those in those discussions at any time?

Speaker 2

Yes. Let me start with the first hold of your question, we have 33 trunks delivered, I mean, this quarter. So obviously, this is going in the right direction, which is good. And the 14 of those 33 trunks with were both. And so it's more trunks than basically what JP just announced a few days ago.

Speaker 2

But also, if you're looking at our customer list, you will see both in there and also DHL, IKEA, Dollarama, Amazon and many others as well. So a lot of those truck operators, we see the benefit of the total cost of ownership, and they're starting with a few trucks. We still feel that it's going to go faster than it did with school buses. And school buses, it took about 5 years to really take off. And we feel that Trucks is going to be a little bit faster.

Speaker 2

But obviously, with all the crisis that we saw in the last couple of years, there was a little bit of a step back on this side, but we feel now a good momentum the with the truck operators, the discussions are very good as well. So we're kind of Well, let's say we're kind of excited that we feel that the number of deliveries

Speaker 3

will keep increasing. And with respect to

Speaker 2

your question with JV, obviously, all those communications that are very confidential. So I don't think we can comment on any of I mean, we're keeping the relationship with our customers very confidential.

Speaker 10

Got it. Thank you so much. Those are my questions.

Speaker 2

Thank you.

Operator

We currently have no further questions. So I would like to hand the floor back to the management team for closing remarks. Ladies and gentlemen, this concludes today's call. Thank you for joining. You may now disconnect your lines.

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