Commercial EV manufacturer Workhorse Group reported a steep sales drop in 2024, reflecting broader challenges facing the EV truck market.
BY THE NUMBERS: Sharonville, Ohio-based Workhorse Group reported the following full-year figures in its earnings statement and 10-K filing today:
- Sales revenue fell 49.5% year over year to $6.6 million;
- Gross loss totaled $22.2 million, up from a $25.3 million loss in 2023;
- Finance leases declined 28.7% YoY to $4 million; and
- Finance lease liabilities totaled $528,023, down 79.3% YoY.
FLASHBACK: The company executed a 1-for-12.5 reverse stock split on March 17 to increase its stock price and regain compliance with Nasdaq’s minimum bid price requirement.
BIG PICTURE: Workhorse Group’s sales decline comes amid overall uncertainty in the EV truck industry. President Donald Trump has attempted to pause or eliminate EV incentives which have been crucial to helping offset significantly higher upfront costs.
“Several fleets have paused or delayed their EV investment plans,” Workhorse Group Chief Executive Rick Dauch said during the company’s earnings call today.
“Fortunately, a few have not, and several states continue to move forward with their plans to electrify their state-funded fleets,” he said.
“Here at Workhorse, we did not build our business model around political cycles. We built it on designing, building and selling great trucks with great people and with great business partners.”
— Workhorse Group CEO Rick Dauch
While large truck OEMs are “still bullish” on EVs as many companies strive to meet sustainability goals, smaller EV truck makers are facing an uphill battle. Reflecting this, commercial EV maker Nikola filed for bankruptcy in February, culminating the company’s struggles since going public in 2020.
In December, Canadian OEM Lion Electric obtained creditor protection under the Companies’ Creditors Arrangement Act in Canada. The company is using this protection either to restructure its business or to explore a sale of its assets.
FUTURE LOOK: Workhorse Group expressed “substantial doubt” over its ability to continue operating due to recurring losses, accumulated debt, delays bringing vehicles to market and lower than expected demand, according to its 10-K filing with the Securities and Exchange Commission. The company’s survival is contingent upon several factors, including increasing sales, reducing expenses, limiting capital expenditures, obtaining proceeds from financing arrangements and executing a sale-leaseback deal for its Union City, Ind., production facility.
The company is also focused on expanding its presence in the medium-duty truck market, which has more charging infrastructure to support EVs compared to the long-haul, heavy-duty segment, Dauch said during the call.
“We fully recognize that EV adoption in the commercial space is taking far longer than previously forecasted or expected by industry experts,” he said. “But the fundamentals and business logic to transition to EVs in the last-mile delivery segment remain the same.
“Medium-duty commercial EVs make sense. They typically service customers across the 50- to 100-mile route and return to duty station every day, leaving plenty of time to be recharged.”
MARKET REACTION: Shares of Workhorse Group (NASDAQ: WKHS) were down 5.2% from market open to $1.84 as of market close today. It has a market capitalization of $8.3 million.
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