Electric vehicle earnings mixed facing uncertain future

Manufacturers Nikola and Lion Electric reported mixed results for the quarter ended March 31, as the electric vehicle market navigates questions about adoption and infrastructure. 

Class 8 truck manufacturer Nikola’s sales declined 26.2% year over year to $7.4 million in the first quarter as the company transitioned to mixed manufacturing of full cell electric vehicles (FCEVs) and battery electric vehicles (BEVs) to adapt to infrastructure concerns, according to the company’s May 7 10-Q filing with the Securities and Exchange Commission. 

As a result of the transition to mixed manufacturing, Nikola’s model production changed to the Tre FCEV unit in Q1, with the company producing 43 units and shipping 40 units, according to its 10-Q filing. For comparison, Nikola produced 63 Tre BEV units and shipped 31 units in Q1 2023, although the market for both vehicle types remains a concern. 

“If the market for our FCEV and BEV trucks does not develop at the rate or to the extent that we expect, our business, prospects, financial condition and operating results will be harmed,” Nikola said in the filing. “The market for hydrogen fuel cell and electric trucks is new and untested and is characterized by rapidly changing technologies, price competition, numerous competitors or potential competitors, evolving government regulation and industry standards and uncertain customer demands and behaviors.”

Lion Electric revenues grow  

Commercial bus and truck manufacturer Lion Electric increased revenues 1.5% YoY to $55.5 million in Q1, according to the company’s May 8 earnings release.  

While the company experienced year over year growth in the quarter, its revenue was lower than the past four quarters as delays from Canada’s Zero Emission Transit Fund (ZETF) and the U.S. Environmental Protection Agency funding programs created operational issues, founder and Chief Executive Marc Bedard said during the company’s earnings call. 

“Revenues in Canada continue to be significantly impacted by the delays and challenges associated with the granting of subsidies related to the ZETF program,” he said. “Revenues in the U.S. were largely impacted by the timing of orders and deliveries tied to the EPA program, being in a transition phase between two funding runs for this $5 billion program that is crucial for advancing electrification in this market.” 

As a result, Lion Electric took several cost-cutting measures this year and last year, Bedard said. 

“We continue to proactively make difficult but necessary decisions, including implementing additional cost control measures such as rightsizing our workforce,” he said. “Combined with the measures announced late last year and early this year, we estimate that these initiatives will result in annualized cost savings of $40 million.”