Xos Trucks and EV designer and assembler ElectraMeccanica have entered into a definitive arrangement agreement, pursuant to which Xos will acquire all of the issued and outstanding common shares of ElectraMeccanica in an all-stock transaction. This is quite big news in the EV world, as ElectraMeccanica has recently turned down a similar M&A project shared with British e-truck manufacturer Tevva, with significant legal consequences.
The members of the boards of directors of both companies – Xos and ElectraMeccanica – unanimously approved the proposed transaction. With over 600 units delivered to fleet customers since 2020, and approximately 12% GAAP gross margin in the third quarter of 2023, Xos has demonstrated its ability to profitably scale manufacturing of commercial electric vehicles in its Tennessee factory, capable of producing up to 5,000 vehicles per year at peak capacity.
Statements from Xos Trucks and ElectraMeccanica
Dakota Semler, Chief Executive Officer and Chairman of Xos, said: “For seven years, Xos has designed and manufactured commercial electric vehicles that are relied upon by several of the world’s largest and most recognizable commercial fleets. We are a leader in producing robust electric commercial vehicles and are delivering positive gross margins today. We believe leveraging ElectraMeccanica’s assets will strengthen Xos’ leadership position in the robust commercial truck market and allow Xos to scale profitable vehicle sales.”
Susan Docherty, Chief Executive Officer of ElectraMeccanica, added, “In my last shareholder update, I stated that nothing was a higher priority than finding the right partner for us to create and re-accelerate shareholder value. We believe the proposed combination with Xos would achieve our management team’s objective to generate revenues, achieve credible long-term profitability and improve shareholder value. Today, we couldn’t be more pleased with the proposed combination with Xos, given its clear track record as an EV OEM with industry-leading gross margins”.