There are several reasons to worry about the prospects of success, most notably from competitive pressures like I mentioned earlier in the article from established automobile manufacturers who are already introducing new all-electric vehicles - including Ford with their F-150 Lightning which is the closest rival to the company's purposed Endurance light pickup truck. This is assuming the company does not launch any other vehicles throughout that time period, an assessment which I believe is silly but for the purpose of this investment thesis I will assume.īefore heading in to discuss valuation, which is the reason we're all here today, it's worth noting that these expectations and assessments are not without risk, and significant risks at that, given how crowded the electric vehicle market is. (Source: Company expectations / Author calculations)įor the following years, assuming an ~8% market share through 2030 means that the company will have the potential to deliver just shy of 80,000 vehicles a year in 2030, which with an average price of around $50,000 comes out to about $4.5 billion in revenue per year. This brings the following revenue projections for the next 3 years, where I assume a $2,500 reduction in price each year to account for efficiency, as stated by the company: Year With a starting price of $52,500 per car, which is on the conservative side since most people who are spending that much on a pickup truck are likely going to go for upgrades, as we've seen with Tesla cars and others. Analysts and company projections are calling for 2,500 deliveries in 2023, followed by around 10,000 in 2024. This is a result of supply chain issues which have plagued all automobile manufacturers as a result of ports closing throughout the COVID-19 pandemic. Right now, the company expects to deliver about 500 vehicles in 2022, significantly down from their initial expectations when announced back in June of 2021. Expectations Are Conservative, Valuation More So My belief is that with the help of Foxconn, as well as them focusing solely on the pickup truck model without venturing into places unknown - they'll be able to 'pick up' quite a decent market share of that 1 million vehicle demand as they ramp up production. But by 2030, the same market analysis calls for there being a demand for about 1 million electric pickup trucks, a 40-fold increase over the span of about 8 years.

Market experts expect the electric pickup truck market to sell around 25,000 vehicles in 2022, dominated by the likes of the Ford ( F) F-150 Lightning.

There certainly are hurdles the company will face, most notably the established presence of companies like Tesla and other automobile companies, some of which have opened their first manufacturing plant over 100 years ago.īut given the fact that the company has reached a deal with Foxconn ( OTCPK:FXCOF) to help with raising capital for mass production of their flagship light pickup truck the Endurance - the prospects of the company meeting their already slimmed down delivery estimates is relatively high, and thus I believe the company's potential is vast relative to its current valuation. I believe that Lordstown Motors ( NASDAQ: RIDE) is one of those candidates for 2022.

There aren't many people, let alone investors, who wouldn't have wanted to get into Tesla ( TSLA) a decade ago or even a few years ago, while market analysts and the conventional wisdom was that they'll be close to bankrupt and not be able to sell the amount of electric vehicles they are selling today.

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