Canoo Inc. (NASDAQ:GOEV) Q4 2022 Earnings Call Transcript

Tony Aquila: I think actually, it’s — for the big companies, it’s more of a business target and a target for business performance. So, it really — it’s just been extra additive. But for the medium-sized businesses, it’s kind of — it’s a tipping point decision. It’s actually helped. And we didn’t really even cover within the pipeline. But there’s a tremendous amount of companies that have emerged because now it’s really affordable for them to enter into this as they navigate some of the charging issues and other things. So, the Inflation Reduction Act is super additive to helping the customers that are — have more difficulty in the transition, if that makes sense.

Pavel Molchanov: Right. Yes, it absolutely does. I mean, I guess maybe the counterbalancing variable is that oil prices and gasoline and diesel have fallen to the lowest levels in about 1.5-year. Is that a headwind at all to the adoption curve as you talk to prospective customers?

Tony Aquila: Yes. I think it would be for those companies that are focused on selling 1 or 2 at a time because it’s immediate return on capital versus kind of, if you will, your greenhouse gas emission targets and so on. I think for the bigger companies, that’s a marginal issue. And the life — because they look at the long life of the vehicle, the total cost of ownership and return on capital, these are just better platforms as we proved with thousands of miles of testing and deliveries. I mean, these are — so we know the outcome of the math. Right now, it’s still very positive for us, looking at on a return on capital from a long-term basis. So, those customers are still steaming ahead. But to your point, I would imagine for the small, small business, which we have not focused on the individual user basis at this time, I would imagine that they are slowing down.

Pavel Molchanov: When you think about a payback period for, let’s say, the LDV right now, what are we looking at, like, 4 or 5 years, something like that?

Tony Aquila: It depends on how they use it. With the fact that our range is now 50% greater than what most of our customers, not all but most of our customers are requiring, they actually can get a lot more return on capital, which accelerates the amount of deliveries they can do on a daily basis as we see these bigger customers emerging. And so, the payback period can be, depending on them, as soon as 3.5 years.

Operator: Thank you. And that concludes today’s question-and-answer session as well as today’s conference call. All parties may disconnect. Have a great day.