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Shares of Mullen Automotive (NASDAQ:MULN) are down by about 10% today, despite the electric vehicle company providing an update on Bollinger Motors. Mullen acquired a 60% controlling interest in Bollinger back in September 2022 for $148.2 million in stock and cash.
Bollinger has now received 40 orders for its B4, a Class 4 EV truck. These orders are worth a combined $6 million.
“The B4 has been very well received to date and it’s great to see our first 40 vehicle orders coming in well in advance of production start,” said Bollinger CEO Robert Bollinger.
The B4 has not yet entered production, although Mullen expects production to begin in mid-2024. This lines up with the expected production date of 2024 that Mr. Bollinger had previously provided InvestorPlace last March. Bollinger announced in May 2022 that it had selected Roush Industries as its contract manufacturer for its Class 3 through 6 vehicles.
MULN Stock: Bollinger Receives $6 Million in Orders for Its B4 Truck
Mullen also believes that the B4 will be eligible for a federal purchasing incentive of 30% of the cost of the vehicle, with a maximum incentive of $40,000, under the Inflation Reduction Act of 2022.
The B4 carries a gross vehicle weight rating (GVWR) of 15,500 pounds, which is the maximum weight that the vehicle can safely support. Mullen notes that the range will be between 110 and 200 miles. With alternating current () Level 2 charging, the B4 will be able to charge from 0% to 100% in nine hours. With direct current ( ) fast charging, the vehicle will be able to fully charge in 1.5 hours.
Like Mullen, Bollinger’s path to production won’t exactly be a smooth one. For the year ended September 2023, Bollinger incurred a $63.98 million goodwill impairment. Mullen attributed the impairment to “unfavorable market conditions and the decline of market price of the Company’s common stock.” For Mullen, the bad news continues. Its goodwill, which appeared on its balance sheet following the acquisition, is now worth $28.84 million compared to $92.83 million as of September 2022. This reflects a decline in Bollinger’s valuation since the acquisition.
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On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.