Electric vehicle manufacturer Arrival: a new approach to increasing sales has
Startup Arrival Inc. (ARVL), which develops electric vehicles, intends to revolutionize the industry through a new approach to the work of factories.
Arrival said that its cars would be more affordable thanks to an innovative production model that involves the placement of more miniature capital-intensive small factories directly at the points of sale.
The company wants to build “micro-factories” so that production is closer to cities and consumers. In addition, Arrival intends to become more vertically integrated through its production of batteries. Note that Arrival focuses on the commercial market: buses, delivery cars, taxi cars, etc. The company claims to have developed five automotive platforms for different segments.
Initially, planned to launch production of buses in the second quarter of 2022 and delivery vehicles in the third quarter—however, the forecasts are in the direction of a likely reduction in possible production volumes. At the same time, management clarifies that the release schedule will depend on access to capital.
Arrival currently has essential strategic partnerships, including Hyundai Motor and Kia Motors. They have signed a memorandum of understanding with Uber on developing a taxi car. In addition, they signed a purchase and sale agreement with the UPS delivery service for 10,000 delivery vehicles and the possibility of buying another 10,000. But, of course, there is still a risk that transactions can be canceled at any time if Arrival delays production.
Note that Arrival is also becoming a more vertically integrated business. For example, it is increasing the production of batteries at its enterprise and announced cooperation with Li-Cycle Holdings to produce lithium-ion batteries. Such a partnership helps avoid difficulties in the supply chain, from which most of the industry suffers.
Arrival is converting an existing warehouse in North Carolina into a battery module assembly plant to production in the third quarter of 2022. The situation around Arrival is ambiguous. On the one hand, the company convinced significant partners of producing electric vehicles but has not yet proved this ability in practice due to limited financial opportunities. So explains why the company is trading 75% below 52-week highs. Startup Arrival Inc. (ARVL) stock was worth $7.97.
