Arcimoto, Inc.
Q2 2020 Earnings Call Transcript

Published: 20 Aug 2020

[Mark Frohnmayer:]

Good afternoon. Welcome to Arcimoto’s Quarter Two 2020 Earnings Webinar. As I typically do, I’m going to start with corporate update video and then dive into a little bit of a background on Arcimoto and our aspirations for the near and long term, before I open it up to questions. So if you have questions, use the Q&A button on the Zoom interface to ask questions and I’ll try to get to as many of them as I can before the end of the presentation. And with that, here we go. These videos are typically a little bit choppy over Zoom. You would be able to find a YouTube link to this on our IR page here very shortly. So if you want to see a video in the immediate term in the clear version, you can do that from arcimoto.com/ir and then we’ll bake in the full res version into the recording of the webinar when we post that later on today. And with that, here we go. [Advertisement] And so with that, I’m going to again walk through in a little bit more detail the reason for Arcimoto and then talk about our targets for the near term as well as a bit more detail on the long term before opening it up to Q&A. This is an image that we’ve shared before. This is really sort of the ah-ha of the Arcimoto platform push in just a couple of pictures. Here’s the way that we transport ourselves is really disconnected from what our actual requirements are on a regular transportation basis. And so the idea of Arcimoto is really not about changing behavior patterns, like getting people to ride in an electric bicycle instead of driving. Really what Arcimoto is about is building the right tool for the job for every day trips, but actually comprise the vast majority of car trips on the road today. And by building a platform that is right-sized to daily trips, we think that we have build something that is much more efficient by design than cars on the road today and more efficient by design than typical electric cars, and at the same time something that is radically more affordable to the mass market than full sized vehicles. So that combination really has led to the development of a new vehicle platform targeted at a market that is very, very large. And what we’re doing is we’re going after slice by slice of the overall vehicle market to find good products that fit a wide range of trips and yet rely on a single common platform so that we gain the benefit of scale across the full product family. And this is – one of our analysts calls this multiple shots on goal. It’s one platform to go after daily drivers, to go after last mile delivery, to go after the first responder market and leads to the platform products that we currently have articulated; the Fun Utility Vehicle which is now in production aimed at daily driving, at vacation rental, very, very fun way for individuals to very efficiently get around on daily trips. The Deliverator which is for last mile delivery but also you can really think of the Deliverator as just our general purpose fleet utility vehicle. It’s just a wide range of trips that are not delivery based, but could be anything from maintaining grounds to bringing tools to a jobsite to locksmith to just a whole range of trips on both the government and corporate fleet side. And then finally, the Rapid Responder which takes the real benefits of the Arcimoto platform, ease of maneuverability, the ability to get across town much more quickly than full-sized vehicles and applies it to emergency responders where time is such a critical element in terms of saving lives and getting to incidents more quickly. So we have the FUV in production today; the Deliverator and Rapid Responder are both in pilot deployments right now and we have additional platform products that we’re planning on getting out in the next – over the next coming quarters. So as we talked about in the video, we have outlined what we consider are big, hairy, audacious goals for the next two years, which is to actually get Arcimoto to the point where we are at mass production and have planning for the growth in our production capability to 50,000 units per year within 24 months. And this has always been the goal for the company, which is to say that we cannot deliver on our mission of sustainable transportation unless we make just a whole lot of Arcimotos, but it is only very recently that we have built the team that we think will actually get us there in reasonably short order and we talked about it a bit in the video, the collaboration with Munro & Associates. We’ll actually be releasing a longer form version of that interview that kind of goes into a bit more detail on their background and where we aim to go. But one of the things that’s interesting to me is that one year ago in our earnings call, we had – we laid out sort of a long-term growth target and obviously the near-term targets have been heavily impacted by the pandemic and the challenges of getting early production operations up and going. But what this Munro collaboration really does is we think put us back on track for our long-term aspirations for the company. And the way that we look at this is I think ultimately what we want to do is take a page out of Tesla’s playbook, which is to say that it’s not just about the product, in fact the factory design itself is really the key to the growth of the venture and the solution to the big problem that we’re going after. So what we are building and planning today in collaboration with Munro is the factory architect, the factory design plan that we want to then replicate all over the world. So I want to be very clear that we think this is a very challenging goal to get to plan for the growth of production capability to 50,000 units over the next 24 months. It is going to be a very challenging slog. It’s been true of pretty much every electric vehicle production venture that we have seen to date, but we do believe that we have the team in place that could actually pull it off if things go the way that we hope that they do. In the near term, we want to continue to get Fun Utility Vehicles and our other platform products out on the road. So we have resumed production of vehicles and we plan to resume delivery of vehicles this quarter. We want to get back to where we were when we suspended production in March, which is the step up to three units per day before the end of this year. We have been wrangling as one would expect with a whole host of early service and supplier quality issues and we plan to get those resolved in the near term as we continue to drive down cost. So we are still pushing in the near term and we're actually with Munro, we're doing kind of two separate programs. One is identifying things that are much nearer term, short-term wins that will improve quality and also drive down cost and then the longer term, which is to scale to much higher unit volumes over the span of a couple of years. And then we see and have seen continued interest as we’ve gotten Deliverator pilots out on the road, just continuous inbound inquiries on that product family from potential fleet applications. And so a near-term continued focus of ours is going to be to get additional Deliverator pilots out on the road and those pilots are going to be very helpful; one, in building the brand of the Deliverator product and just getting the word out about it, but also really preparing us for all of the fit and finish and features that we’re going to want in that product family to make it a very, very useful fleet vehicle. And then finally, and I think as important as all the rest, is that all of the planning work that we're doing upfront in collaboration with Munro feeds into our application for the Advanced Technology Vehicle Manufacturing Loan Program through the Department of Energy and that will – the plan is to get that application submitted as soon as we reasonably can. So that is the high level of where we're at with Arcimoto. And I’m going to just go ahead and stop right there and open it up to Q&A. I see quite a few questions in the queue already and I will start in on them.

[Mark Frohnmayer:]

So David Hickok [ph] asks, can you talk about how production is going? Production is – we were producing right now at a, I would say almost a glacial rate. We are producing slowly and that has to do both with getting the proper safety procedures in place within the factory to protect our team, but also issues that you might imagine in terms of supplier quality issues, supply stoppages on various parts and all things that we are working to unwrinkle as rapidly as we possibly can. Next question, what is Arcimoto's outlook on battery technology, specifically solid-state batteries? Do we see a future there? I would say our outlook on battery technology is – battery technology currently is getting very, very good and looks like there is a roadmap for just continued improvement over the next decade. Solid-state batteries appear very promising. Also, if you look at the work that Tesla and others are doing in terms of improving energy density, improving power delivery, improving longevity, we see the roadmap going forward as being awesome. We are not ourselves a battery cell producer. So we – what Arcimoto does is we buy cells, we put them together in packs and put them into a very efficient vehicle platform. So we look at – we are ultimately agnostic as to a particular battery technology. We just know that as batteries get better, our products will continue to get better. Charlie McLean [ph] asks, production goals for 12 months and 24 months’ time? We will have much more to talk about that in our quarter three earnings call. We’re still working out the details of what our ramp over the next 18, 24 months looks like. And so expect us to be able to share a bit more at that point. But again, in the near term, the plan is to get back to where we were in March before we shut down for the pandemic as rapidly as we can. In terms of how many preorders do we currently have and can you say the rate at which they grow? So, yes, preorders have been continuing to grow – net preorders have continued to grow quarter-over-quarter for the last five years at least, and I'm going to have to pull up my old sheet that our CFO, Doug Campoli shot me before the meeting to get the exact number for you. But I want to say we are around 4,400 and change. Yes. So preorders – I would actually have to refer back. But assume 4,398, so right around 4,400 preorders and that’s as of the end of quarter two. We’ve had actually a bit of an uptick since then. In terms of the production side, we have built now – completed or in progress 113 vehicles today that are either done or have hit the manufacturing line. And of those, the majority are on the road. Next question is when do you think you can ramp to 100 million in revenue? I think the answer to that question really ties into when we actually hit mass production and what the ramp looks like over the next 24 months. So expect me to have a more clear picture of that next quarter. Ramo Danisco [ph] asks, Mark, could you please discuss initial feedback from the beta test runs of the Deliverator as well as Rapid Responder vehicles you had testing with the fire department? If you want to look at Rapid Responder feedback, I’d actually point you to our YouTube channel where we had a detailed interview with Eugene Springfield Fire's Fire Chief. And in that discussion that we had with him, what he was talking about was actually kind of redefining their service model based around smaller form vehicles that are more fuel-efficient, lower cost and easier to get to incidents more quickly. And I think when that pilot program ends, we’re going to have a lot more detailed feedback from the actual day-to-day usage. In terms of the Deliverator, I have now had a chance to actually deliver with the Deliverator myself and I would say that the experience of it is; one, is really just a remarkable amount of storage for small form vehicles. So we've done a few delivery missions with lots of parcels, with coolers for camping. And if you look again on our YouTube channel, we have a detailed interview with the folks that Carry It Forward, which is our first Deliverator pilot about just how useful the vehicle is versus a large form delivery vehicle. So in terms of – the real advantage of the Deliverator as well is as you get where you want to go more quickly, it's easier to move through traffic, I think ultimately for delivery applications that’s going to mean getting there with – the delivery driver gets there with a smile on the face. Next question is any update on the daily usage of the Deliverator within HyreCar, how do you plan on delivering more Deliverators to them in the near future? Right now, we’re actually – we’re just in the beginning phases of getting those vehicles on the road with HyreCar. And so, again, I would expect that on our next quarterly update, we’ll have much more detailed feedback from gig drivers on the HyreCar program. And in terms of rolling out more Deliverators, we don't have any immediate plans to put more vehicles in their program. What we’re really trying to do – and again, just based on the rate of production that we’re doing today is to make sure that we get at least a couple, one, two pilot Deliverators in the hands of lots of different fleets that are going to be key drivers for sales growth over the next 12 and 24 months. Ben Hinchcliffe [ph] asks what are the biggest hurdles in scaling up production? Well, where do we start? Getting the symphony of production to play together right and that's I would say probably the biggest challenge that we see at the moment is really getting a whole course of suppliers to flow together into a scaling production operation, and that has been – we’ve worked through lots of headaches already in partnership with our suppliers, but then I think exacerbated – those problems have been exacerbated obviously by the pandemic. So this has been just a phenomenal amount of work both on the Arcimoto side and in partnership with our partners that are actually building the key components of the vehicle. And really the – you got to think about Arcimoto as it’s a team of hundreds of organizations working together to build a revolutionary new product. So the early pieces of that are challenging both on the side of the company and then at all of our partners. Amit [ph] asks 50k units per month or 50k units per year? 50k units per year. It will be a while before we get to 50k units per month. Anticipate any further weight savings from 3D printing of parts? We have looked at – so this is in reference to the program that we initially with XponentialWorks at the beginning of the year where we shaved together 30 pounds in 30 days from the platform. We see the potential for additional part optimization in partnership with them. And then also we see just as we are refining the design that we’re going to be able to drop weight even using conventional methods. Davesh [ph] asks, are you looking at any other locations outside the U.S. at this point, particularly countries where cars are not the primary source of commute but small form factor vehicles are preferred? The short answer is yes. We have had conversations sort of all over Southeast Asia, in Europe for the European market, conversations that are in the very early stages for South America where you have smaller roads, more dense urban areas and markets that are already very accepting of small form vehicles. So we are – we definitely see the world market as the eventual plan for the company, but we are still focusing on really getting our production legs under us here and building the mass production plan here that we will then take in tandem with partners all over the world is the plan. And a follow-up question from Ankur [ph] is this technology can be very successful in countries like India where there are small roads and a lot of traffic. Solar energy is available in abundance throughout the year. Do we have any plans to expand to India, in particular? And I would say, we've certainly had conversations with potential partners in India, nothing that is material at this point to disclose. Ramen [ph] asks, hello, I recently rented an FUV. I loved the drive, but could have used some power assist in the handlebars. Is that in the plans? I also got splashed a few times. Is splash guard in the works? And how about technical repairs if destination was the plan for having trained technicians in local markets? So, good questions all. We do expect that we will continue to see improvements, particularly in the low speed steering of the Arcimoto as we both refine the steering system in the power steer unit. And then as we continue to drop the weight on the platform, that will also have a steerability benefit. In terms of weather protection and total protection, if you saw in the video, we have now our half doors that are basically right on the cusp of getting ready to get out there to some of the early adopters who have been waiting for them. We've also seen some really cool developments from some of our partners. In particular, our New Zealand partners overseas have developed a really cool full-side covering, a soft covering and they’re sending that to us for evaluation here directly and that’s something that we hope that we can get out to our customers as well. We do plan on having repair be a portion of the business of all of our rental franchisees and rental operations. And so that's definitely a piece of it is that our rental franchisees will help serve their local market in terms of repairs. And then we also announced earlier this year that we have a partnership with Road America to do roadside assistance and to tap into their network of something like a 170,000 garages across the country that can all be – the Arcimoto from a service perspective for the typical ware items is a simple vehicle to work on that anyone who can do white automotive service for tires and brakes and shocks and so on should be able to very easily service those items on the Arcimoto. David asks, you mentioned 397 possible improvements. How many of them will be considered low hanging fruit or easy ones to put into practice? Actually, the 397 are the low hanging fruit and then there are 213 more brainstormed opportunities of potential cost reduction that are longer term, so more than a year out. But we – that 397 – and again, I just can't stress enough how awesome it has been to work with Sandy Munro and his team. The process that they use, the expertise that they have brought to bear in very short order has been I think – has really blown us away as a team. We are very happy to be working with them. We have work-shopped together every single part on the Arcimoto over the last several weeks, and that’s really where that map came from of looking at every single piece and saying, how can we do this better? How can we combine parts? How can we combine materials? How can we remove fasteners? How can we remove costs? How can we improve performance? And a lot of those are near-term opportunities that we aim to get into production in relatively short order, like within the next 12 months. Alexander Struff [ph] asks, I know you believe in Arcimoto as a company, but would you entertain acquisition offers from other companies in similar spaces? I would say the nuance answer to that question is, we would entertain acquisition offers from companies that we believe will make Arcimoto's mission go faster. So I've never thought of this as a go-it-alone-forever company, although we think we can be very successful down that road. But where we could align with companies that have resources to bring to bear and where we are very product envisioned aligned, I think that can make a lot of sense. So from a sort of an exit standpoint, we’re already a public company, investors can come in and out as they choose, but there’s probably a small handful of companies that I can think of that I would say could accelerate us towards our own omission by being a part of them, but not something that we are actively entertaining or pursuing at this moment. Ben Hinchcliffe asks, he says Arcimoto seems well positioned to take control of the three-wheel vehicle market. Do you see any competitors or worried about another company mass-producing a three-wheel vehicle before Arcimoto? The competition question comes up a lot. We see a lot of adjacent products and that could be anything from the TWIZY by Renault or the Solo by ElectraMeccanica to the Slingshot by Polaris, the Spyder from Can-Am. We think the Arcimoto platform has distinct markets that are away from the core markets of those various products. And in terms of are we worried that another company in going to mass produce three-wheeled vehicles before us, our mission is to help drive sustainable mobility across the world. And so we make a point of celebrating the successes of others in this very challenging field. Chris [ph] asked, what are your expectations for sales in second half? I think I talked about this a little bit, which is that we’ll have much more clarity on that at our next earnings call. Amit asked, what are the capital needs for 50k per year production? We are in the process of determining the answer to that question, and that’s basically what is going to go directly into our ATVM application. But the ballpark is that we would still be on the – at least from the ATVM’s perspective sort of on the micro loan end of their spectrum. Sanjay [ph] asked do you plan to grow capacity to 50k units per year in Eugene or is this expected to occur elsewhere? We are planning to grow – we are planning for the growth of production capability to 50k in our current geography, but we also expect that that same template is what we would then take to the East Coast, to Southeast Asia, to Europe and so on. David asked knowing you're very busy, would you be interested in doing a Zoom presentation during a local electric auto association meeting? I actually do Zoom presentations on a very regular basis, and so I’d be happy to get you guys in the queue. Mike Scheske [ph] has a very long question. Okay. How many vehicles were delivered in Q2? How many do you expect to deliver in Q3 and Q4? What is your backlog of orders or expression of interest as of the end of Q2? Do you have a feel for your breakeven point once you implement your changes from Munro? Will your new 50,000 a year production capacity require any new facility construction? How likely is it that you will utilize the full 50,000 unit capacity in 24 months? Are you pursuing any other tests of the Deliverator? Okay, Mike, all awesome questions. So how many vehicles were delivered in Q2? I want to say we delivered 11, but I would have to refer back to our Q filing. And in terms of expectations for Q3 and Q4, we’re still figuring that out as we – in terms of exactly when we’re going to step back onto the ramp that we paused in March. And so we’ll have more details on that at the next quarterly update. Our backlog of preorders is right around 4,400 as of the end of the quarter and those are people who’ve actually put down a refundable deposit or a non-refundable deposit for vehicles. Do we have a feel for our breakeven point once we implement our changes from Munro? We’re – when we’ve done breakeven analyses, it’s in the 3,000 to 5,000 unit range is where we think we can breakeven. And we’ll likely have an updated picture on that as we really map out those near-term cost reduction opportunities into a detailed plan of attack. But will our new 50,000 unit production capacity require any new facility construction? It will certainly require additional facilities, whether those are facilities that we construct or existing space that we move into. We think that the maximum capacity of the space that we have today is in the 5,000 unit range. So again, we think we've got the space capacity to achieve that breakeven point. But in order to get to that next order of magnitude, we’ll certainly require more space. How likely is it that we will utilize the full 50,000 unit capacity in 24 months? Well, our goal will be to fill the sales pipeline to be able to meet that production target. But whether we’re able to do that right out the gates or not remains to be seen. I would say that what gives me a lot of hope in that regard is just the response of our early customers to the Fun Utility Vehicle and all of the inbound inquiries that we’re not receiving for the Deliverator specifically. We expect the Rapid Responder to have probably a longer sales cycle and be more challenging at least in terms of vehicles that we sell to government fleets, although the corporate fleet security opportunity we think is another one that it is a potential significant growth opportunity. Are we pursuing any other tests of the Deliverator and Rapid Responder? Yes. So we have – based on our early deployments of those, we've received quite a few inbound inquiries and we're just parsing through how we want get a very limited number of vehicles out the door. In what order? As rapidly as we can. With all the capital that has been raised, do you still need the Advanced Technology Vehicle Loan Program? Yes. So the capital we've raised we believe will get us solidly through the planning aspect of this next stage as well as the resumption of scale of production of the FUV. But in terms of actually getting to mass production scale, we think that is going to take additional capital and that is what we are applying to the ATVM for. So the nice part of that program is that it's a very low interest rate, non-dilutive financing for scale and we think we’re going to be right in the sweet spot when we drop our application. Can you update us on the federal and state subsidies that are available for customers? Presently, there is no federal credit for the Arcimoto but at the state level I believe there’s a $2,500 Oregon tax credit. We just passed the Pomona Loop test which we think will allow us to access the California rebate for motorcycles which I believe is $900. And then we’re actually working with our delegation to extend the motorcycle electric vehicle tax credit that applies to two-wheeled bikes. We think that should also apply to three-wheelers. And so we’ve had a lot of good conversations on that level. And the – presently the zero mission commercial vehicle vouchers that are available, we’d have to look at those on a program by program basis as to whether a three-wheeler would qualify or whether that requires a four-wheeled vehicle. Amit asks, how do you get to 50k per unit sales, sales to retailers, sales to fleets? What’s the expected mix? I think it is too early for us to have clarity on what the expected mix is going to look like, but it will be a mix of direct sales to consumers and direct sales to fleets. And just based on what we're seeing from early customer response and response to the vehicle on the road, we think that as we continue to drive down price that a much wider market opens up both for the consumer vehicle and for the fleet products. Next question is, how much interest are you seeing for future demand? Is there a waiting list, a backlog? Yes. We have almost 4,400 vehicles preordered as of the end of the quarter and those – that preorder number continues to increase the net preorder number, including cancellations continues to increase quarter-over-quarter. Craig Sweden [ph] asks, one of the issues with Tesla has been service. As you grow, can you grow service? Just pumping out 50k units, is that enough? What about service repair and so on? Growing service is definitely going to be one of the big challenges that we have as we go to mass production scale and what we’re – our goal is to really end up over the next two years is to make sure that the product itself is incredibly robust and that we address all of our sort of big-ticket service and supplier quality issues, while we have still a very limited number of vehicles on the road. And then we’ll have a combination of Arcimoto mobile service, service through our rental franchisees and partners and then service through authorized garages that we identify over the course of the next couple of years and as we expand into new market areas. No worries, Mike. A big block of questions but made it through. Bailey [ph] asks, when do you anticipate expanding to international markets such as India and China once in mass production? We may actually see some of those plans developed in parallel, but we want to make sure that we have the right plan in place for sort of Arcimoto Factory 2.0 and that we're really – we get that very dialed and then essentially – if you looked at the What Would Tesla Do slide, we try and take cues out of their playbook when we can and getting the right factory model that is replicable that we can then build copies of in various markets is the game plan. Jim McGillry [ph] asks, what is expected units delivered in Q3 and Q4? And I think I addressed that or specifically did not address that, which is I don't have a clear prediction for that but we will have that soon. Galileo Russell [ph] asks, can you talk about near-term production targets, goal for deliveries in Q3? How does the gross margin trend towards profitability from here? How much cash do you have one hand today? So again, we – in terms of cash on hand, I think we raised $26.5 million over the course of three successive capital raises, retired about 3.5 million in senior secured debt and then a bit of other debts. Again, we’ve got somewhere in the ballpark of 20 million in cash on hand and we think that dry powder will last us for quite some time as we move through the scale-up process of our sort of low volume manufacturing model. We are still again working out what is the detailed plan for our near-term cost reduction opportunities. We've done the brainstorming step and we’re in the process of turning that into an action plan. And that then will give us much more clarity on when we go gross margin positive and then what we could do in terms of achieving near-term low volume profitability. Jeff Davis [ph] asks, how many active vehicles in use total? Somewhere in the right around 100 level. We’re basically getting vehicles out to customers and then addressing as expeditiously as we can some of the early service challenges, but we have in total either built or on the build line 113. John Way [ph] asks, how soon before you finish developing cold weather months? And the answer to that question is we’ve got – half doors are just about done. The early reports from the folks in New Zealand who have the full side enclosures done is that they're saying that in cold and wet weather driving, they don’t even need heated seats or grips. They actually stay quite warm in the fully buttoned up version and that's something that we are hoping might be our sort of first four season option for the platform. And then we also have our full side enclosures that are more of a hard shell on the drawing board and we expect those to come into play probably in the early part of next year. Scott Home [ph] asks, what is the current status of the grocer pilot program described in the last quarterly update? That is one where due to a significant amount of sort of churn and demand on their side, we've been unable to get that pilot into play as of today. There’s still very strong interest in making it happen. And so we’re just waiting patiently for that particular partnership to continue. Does the company have any contracts to expand or start producing? We are already producing vehicles for customers and for some of our early fleet adopters. We have sold our first Deliverator pilot vehicle and we are still working on getting our final Evergreen series out the door before we begin taking additional deposits for the next series of FUVs and vehicles. Banu [ph] asks, where do you plan to see Arcimoto in five years? If you look back at that aspirational eight-year target’s slide and again that’s aspirational. Where we see the company in five years is mass production in multiple locales around the world making a truly significant impact on climate change emissions from the transportation sector and then from a technology standpoint having a very robust autonomous capable platform for the future of delivery and personal transportation. Jeff Davis asks, what is the advantage of three wheels versus four? The real driver for going to a three-wheeled vehicle platform was initially efficiency, but I would say another real advantage particularly for the form that we’ve developed is just the experience of the ride. For a small form one, two-person vehicle, you can very easily maneuver through traffic. The widest point of the vehicle is in front of you. And so as long as you can sort of get your wheels where you want them to go, the rest of the vehicle follows. It makes it very easy to merge into traffic, it makes it very easy to get around bigger obstacles and bigger vehicles, and it’s just super, super fun with dual motor front-wheel drive, very low center of gravity that’s sort of right around where your knees are as a driver. And so it’s just makes for a very nimble, very fun, very, very efficient ride. Andrew [ph] asks, can you expand on the removal of the going concern warning that you mentioned earlier? Yes. So Arcimoto, ever since we went public, has had a going concern warning in our filings which basically says, hey, this company is strapped for resources for what it wants to do and may not be around sometime in the next 12 months. And so retiring that particular provision in our filings we see as a major step forward. And really the combination of clearing out all of our debt, having a bunch of dry powder to go attack the real problem, building the right partnerships to make mass production happen, it's been a pretty amazing last couple of months. And I’m going to answer a few more questions and then wrap this up. Hello, a fellow Eugenian from Rodney Cliff [ph]. Hello. What kind of timeframe are you hoping to start implementing some the cost savings ideas you’ve spoken about and will these changes affect release dates? So we are implementing them as we speak. The cost reduction efforts are underway presently and then we’ve mapped out a bunch more of potential avenues that we’re going to be putting into play over the next 12 months for the near-term opportunities and then over the next 24 months for the longer-term opportunities. These are not going to affect release dates of vehicles. So these will get folded in to production vehicles as they’re ready. Hanief Freemont [ph] asks, what do we think are the biggest factors to cause Arcimoto to miss the second quarter goal and what we guys will be working on moving towards quarter three? So we didn't actually miss our goals. We missed on the consensus analysts’ expectations and we attribute that almost entirely to the fact that we had shut down production from the pandemic. That we had paused production and that we restarted at a low volume, but we’re not delivering towards the end of quarter two. And we expect to get sort of back on track before the end of the year. Jeff Davis asks, what is the service model, maintenance and repairs? So we see – I think I addressed this a little bit earlier. It’s going to be a mix of mobile service where we actually come in service vehicles in the field, service through rental franchisees and then service through partner garages. And ultimately, we will likely have some of our own dedicated service locations in high-volume markets. Let me do one more. Steve Hansen [ph] asks, how much dilution do you expect from other funding equity rounds? Well, the next piece of funding that we are going after full force is the Advanced Technology Vehicle Manufacturing Loan Program through the Department of Energy and that is a non-dilutive funding source. Whether we are successful in that application obviously remains to be seen. We think all the work that we are doing to plan out mass production is going to be helpful whatever capital source we go after. But I think if you look at what we did in the end of quarter two going into quarter three is we did three relatively minimally dilutive raises that put us in a very good position to execute going forward. And I think we will reserve the right to be opportunistic. We are very protective of shareholder equity and that comes from – we are tremendously loyal to the investors who have propelled us here and we want to make sure that people who buy into Arcimoto has a long-term story, see both the benefit of being a part of the mission and appreciation of their holdings. And so we are at a point now where we’re very selective about capital sources and making sure that we protect our investors as we go forward. And with that, I’m going to wrap it up. And I really appreciate all of you tuning in and the robust questions. It looks like I only got to about a third of them, but we really again we would not be here if it weren’t for all of you believing in this vision, believing in this company and we’re really looking forward to the road ahead. So stay tuned. And we’ll see you next time. Take care.