GOEV - Earnings call 3 2023

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Operator

Greetings, and welcome to the Canoo Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kunal Bhalla, Senior Vice President, Capital Markets, Corporate Development and Purchasing. Thank you. Please go ahead.

Kunal Bhalla

joining our for call. XXXX everyone, you, us QX on earnings Thank excited call this be our We're presenting facility. from to Oklahoma City

call, served update on on you update Board, will Ethridge, our Tony and introduction business our in the and an CFO previously Greg as who financing. on having August, sales provide progress. joined and During our And advised expectations. forward-looking uncertainties, make on current actual we These risks finally, subject our statements Ramesh significant will go differ over the may may QX financial results. Please to are materially. be results based and will

discussion we For Form release recent future to file including SEC, may and business, factors the a results refer that most our XX-Q of with our the and that could please X-Ks. earnings in Form financial XX-K affect disclosure and today's in reports and other

such our assume of currently information by to All today of are obligation as no based to law, statements and as on are any us. statements. required we Except available made update

call, we'll During discuss measures. this non-GAAP financial

can found find today's can to reconciliation which Tony. measures financial section release, earnings measures non-GAAP be GAAP you, these financial the our to website. in IR of Over You on of the

Tony Aquila

give to and nothing to believers and me, mission win. of way to also and to our this your a welcome, it at to pass a for has and micro your financial daunting a it can to has based scale. What in of you me other interesting vision volunteer as but the hard-working live like or We to the yourself to with an country because times, country will fallen in certain or others way, when innovators macro top. am is times you last work especially crosswinds, rather honored takes and that great seen, to then every and behind, creativity, feel many find even this high times, the our like us #X imperative we most and these in find back group just has who versus When headwinds markets people I own forever, to group Kunal, that find and them. decided at us as global amongst is must Thanks, accept do ours. with inner times, market everyone. your our but and by while innovators be is innovation, most resolve to have can follow even game its done and people What on hold that small #X their times resolve who emerge so inspiring at than always day, can against mission. on compounded but is To and and inspiring determination to vote industries impactful blessed so get like-minded bar innovators, only many the part accomplish all see support a have doubt we not the lead world place to more

of more X-plus leadership tough, Canoo. we that when of we believers over grateful While every and are took more our you and introduced direction that strategy times we are the are ago becoming day, in years

in meet as the subproducts and bold, customers and hyper-focused products, military to unique to of and was markets needs the was on know, consumer onto markets. fleet, our and vision not easiest emerging and Our require then government understand different, now that approaches senior we first

Some me, first? consumers It's asked simple. why on not have focus

processes. The are through only to functionality our the standard to a increase can and platform with on we die and of to stress. Not their safety, by out rather demand it testing you most the markets. a the customers and of service to but and this, been recalls. made our perform with for live credit these customers manufacturing But validation contracted of and help expand we our who critical on rigorous has and our to our they and products have these the business risk have The into because to build our are just at way help still fleet delivery have and multiyear our value-based who big benefit will dependence testing platform consumer will test people and risk generations your possible, tested aim hard-working the design of reality those borne critical product we minimalism we you costly discerning of bounds volume bankable to when find of mission additional successfully fast-forward levels. rely of the If before commercial maximum things Because are rigorous beginning redesign the have pass play buyers our our on around customers you products regulatory prove. or continuous our which by for multiple who bets never out feedback in customers improvement, ultimately best, country partners profiles volume under functionality of to

worked years to nearly get X have to We this point.

been the the We will and months. a And at time great mentioned, is for will derisked market Canoo's legacy and the plan, and technology we'll engineered settled mission. complete EV properly continue like characteristic experience with scrappiness, blocking if and substantial as we and it tenacity. slow there its but if have will tackling matters. whole perseverance aircraft, this future Headwinds business any Canoo for have down the of last discipline headwinds I determined, our gain the And and over DNA. Look, derisked XX

let in quarter. our Now the progress on manufacturing update me you

team to a items. long acquire sensitive ways proud time, and continue capital-intensive adaptive environmentally be to to lead and creative and find are We innovative

and With the distress, market in assets has at manufacturing opportunistically team the accretively reduced prices. added

Cherokee and program end grow in be we of announced workforce training the agreement reached XX% we the 'XX, and to presence to under vehicles of QX Enterprise and of Services be will sell We milestone our are Yesterday, X,XXX with that XX% and up of Nation, Oklahoma, to to target our our electric hiring total to facilities. delivering at began we Oklahoma, would key continuing an Management a by workforce batch our vehicles. state our first made-in-Oklahoma employees Oklahomans. In of development Office the Oklahoma

line are: Nation; August XX, OKC achieved for XX, ladder robotics Our EPA commissioning both quarter a City; we prior equipment rate installed this Oklahoma of Oklahoma believe for our battery system on XX,XXX-unit system for at the module November our XX,XXX-unit hit is Oklahoma Pryor; chain for XX, with line facility; essential investment the when manufacturing XX, in frame July partners. be modular the our QX and completed into granted XX, our system permit it's Cherokee disciplined sold milestones to today, run we XXXX. Listen, for on battery equipment the our assembly frame November run and rate the our in for City to track in way and stepping volume supply XX,XXX-unit manufacturing ladder us we pace July update rate on and achieve of run right the general with assembly

like to go we capital Greg will I'd that, activities, then Ramesh. and after markets Now and to sales have cover

Gregory Ethridge

you, Thank Tony.

the modular team interim use until XX had a to control Canoo days my December the in the investment stronger of public of spent team getting join business direct banking, strong management an know in here markets managing recently skills time working My about model management since Board years for the first and to platform years and intro. full private witnessing and put investments, me Just that to directed the investing early to the I and and serving conviction understanding I've and quick when serving XXXX Tony on belief my asked the mid-XXXX restructuring. From and this company's of role. stack, XXXX. capital I Tony substantial spent next XX the privilege business success opportunity phase for I became had of as And benefits pivot of and he often that, to company. growth. technology in financial Canoo after the that, in Prior Directors in meeting prior a unique the

$XXX customers. pivot large commercial the also the from additional you vehicles XX,XXX don't units of the now and delivery a or generated change electric in orders key those consumer-facing was fleet-focused that million have vehicle electric For that customers shift of in to government for remember, focus well committed pression, military towards high well-funded, to quality, given timed. exposure the and high be customers out business with consumer difficulties be turned credit environment. government Canoo's opportunities commercial, This rate model a to appears interest

to milestones. pipeline and and our Now shifting revenue sales recent

Sales the from and Unit phase revenue-generating DoD's entered company. from services. the generated the from for but quarter, also vehicle quarter contract the Innovation Defense deliveries the were during During revenue third we

revenue-generating offer vehicle technologies, As system battery potential and you just many MPP, than modules and more electric of know, underlying sales. our unit, the itself Platform, Multi-Purpose the for drive complete or

Oklahoma commercial day of a byproduct Bulldog Texas. additional at of These launch October we are Tony We The in and CTVs On vehicles Center year X Services. that cycles. lifestyle a U.S. for and Grand customers, missions. November and the Kennedy pleased XX, highly pad high-grade historic testing. NASA delivered XX, constant derivative the company we American transport of when to a very the government especially NASA. of X,XXX-unit Canoo the revealed And models Space It balance will to announced our continue to to Vehicles, in officially yesterday, and Office at attend XXXX. vehicle team. On of want, of a further Management delivered our the was extensive was we as XX, Bulldog, November the our a that since to to the will our the XX, discerning first On up been customers vehicles to in the fleet derivative market testing you during agreement tough developed delivering Prix Enterprise Transportation derivative Crude July or Austin, type this November CTV, the throughout credit, day the delivering CTVs the was specially-configured Formula for as was proud and Florida's for Screaming astronauts Eagle Artemis Canoo again, of future revealed Army mentioned,

book temperature on of when proud with strong the order looking and on sales orders, XXX% derivative customers. very state team stability given the testing, deliveries very pilot duty of discerning X X with pipeline, side customer product including our build XXXX merchandise. billion-plus count, XX% our and book, driving workforce. On across areas found high-traffic with in of growth We the X are the other our general XX,XXX days acceptance our industrial with partnership $X choice backlog. Through deliveries to through pipeline fleet on both in LDV rural high satisfied thousand products. to multiple allows recently and XXX, on to XXX XX,XXX its use over both X at sales high-volume, orders. predelivery segments. prelaunch locations. and reliable continuing cases target more the many X of use miles unique growth be customers weather fleet across key and made our and performance order trials and metros, customer The across environments, X% and Stage to concluded evaluations Strong acceptance, Oklahoma commercial last and key sequential and extreme unique total and continues commercial are LDV Stage our conditions reservation and pricing quarter modulate of order over cycles, food deliveries and XXX-plus years we us Six

we At production, units receiving Canoo, our As customers. expect our to across and been we we hyper-focused have deposits also move on described, delivering customers to fleet optimizing business. start our from as Tony into commercial

a it raising using milestone-based and amounts functional small have to different of achievements. allocating and record areas of strong We track capital

securities, certain total raised in convertible During investment the was that Canoo. The most Canoo we to from million another in has in closed ability October million have strategic partnership at that as we long-term support vehicle. successfully investor of capital a interested our $XX $XX parts to the investment a we with can we raised in very $XXX growth million and million. equity-linked recent attractive quarter, foreign in and support October, for Year-to-date, significantly raised $XX partner its of preferred points approximately the manufacturing is upsize Canoo price achieve to continue milestones. This

with including continue We capital overseas focused be on variety partners. alternatives, to a of other additional

business continue focus will to primary going and this quarter plan. achieve efficiently capital and Our our forward allocate to be

many generating at savings be in levels. that are We business can the redeployed

We getting maximum capital, that on from mission. is our efficiency continue focused to my be and

so. the and backdrop our more as objectives to Ramesh dislocations do in market to of detail. In advantage take will We raised despite arrive, will and opportunities continue will summary, this we very a achieve have challenging those year, successfully describe capital market

innovative scrappy, is and team persevere. Our

to We achieve the I of opportunities business the plan and now to Ramesh will financial take continue to it optimize our our to over advantage will hand front objectives. spend of us results. in review

Ramesh Murthy

Thank you, Greg.

XXXX. quarter walk Now the are a was you we It me for revenue-generating exciting let now of reasons: X QX company. an through results first, and historic

delivered As delivery time, earlier, first the revenues and of Tony Innovation we QX were the X XXXX. generated followed approximately of revenues by engineering certain our our generated revenues Department Defense on when modules in battery of first We to mentioned Unit. in NASA July vehicles of certain milestones of from Defense's generated $XXX,XXX completion

the Our at, of delivering revenues beginning vehicles starting ramp quarter in low-volume are inflection point manufacturing QX the reflect approach we the third XXXX. phased in

customers. schedules our XXXX. that XXXX We a expect $XXX,XXX and months being XXXX pace during rest in the match at to of delivery with cost incurred agreed to September We X to the with ended XX, the are revenues volumes measured ramp of over

Our cost and revenues and assembly our producing amortized includes an vehicle and and components primarily parts of involved costs labor costs capitalized parts, of in tooling components.

net Our logistics XX, primarily $XXX,XXX. vehicle gross NASA or XXXX, of increased and approximately costs deliveries a certain freight of was the cost value and build adjustment X September or ended to custom includes to $XXX,XXX due the LCNRV initial negative lower months margin of and during realizable

improve cost production per-vehicle basis savings achieve we costs. We to increase labor material commercial expect and gross overall a on levels on negative margin as and

been in as milestones expenses negative company. our the focus Second, have since operating has narrowed public EBITDA optimization we of on continuous a adjusted lowest and resulted our

to income the Moving statement.

of loss year third loss reduction in million of prior the expense $XXX in XX% for XXXX follows: $XX.X share prior QX to million million was year Research EBITDA to million for compared totaled for $XX.X the are a million for the year expenses million $X.XX net for million per $XX quarter XXXX. prior per negative was the quarter compared year Our of results Adjusted negative as the development $X.XX prior negative a period, GAAP the $XXX.X GAAP million EPS $XX.X compared period. to from quarter XXXX. EPS the to $XX.X adjusted compared quarter negative SG&A the was Adjusted net period. in reduction the and QX in from quarter of share to the quarter $XX.X prior was compared period, year period. in XX%

million. giving $X.X Turning preferred to cash for million, sale have September $XX flow. cash the and $XX.X used months period. of was to in $XXX.X X and would our million delivery XXXX, total We ended a cash the effect of to the million compared operations issuance, million the prior been $XXX.X shares cash quarter in After balance ended equivalents. with of and warrants for year Cash XX,

XXXX cash the months $XXX.X ended to was net X ended provided $XX.X of to for million the XX, million. September cash XX, September Our financing X capital ended compared activities financing XX, compared September September months the XXXX the XX, XXXX. Net million $XXX.X expenditures $XX.X of for for XXXX months X for by ended provided months X activities by million

cash lower our monthly XXXX QX Our month in XXXX. per flows was cash XX% flow of than approximately in average

optimize We QX we of as continue to into cash XXXX. move

of of to guidance. second follows: our $XXX of million, $XX guidance for EBITDA $XXX and million. had Moving provided CapEx to to We previously as million half $XXX negative the our year negative adjusted the million

adjusted management, is to amongst second deliberate production, EBITDA to to the for to between others for XX% to have as cost, minimize including to used change revised to industry, phased and of improve and labor the EBITDA be allows our expansion mentioned it tools factors, our with to higher allow mix the guidance of ramp Our the long-term $XX our share our relentless transition reasons guidance asset and avoiding amortization switching utilize we the above being thereby units and other a Oklahoma equipment This the engineering to the manufacturing Greg low-volume pace million tools discipline from fully in align result our million purchase CapEx the which us in guidance. reduce second relates guidance $XXX focus has of prior strategy XXXX, to over other acquire us a produced. with in reasons, over resulted perspective, allows revised $XX optimized million combined guidance. Thereby, expense we labor our the from with now half $XX negative to us in These to of to partnering following quarter. From to manufacturing at prior half our negative improvement commitments, as adjusted arbitrage our XXXX of improvement minimally CapEx shared high-volume workforce a initial approach million.

XXXX full adjusted $XXX guidance is negative Our prior EBITDA negative will guidance negative half $XXX approximately to year. bring second our which to XX% to negative adjusted million EBITDA reduction the year million from of $XX million, million a $XXX

Now remarks. let turn it to for Tony final me back

Tony Aquila

we to flexibility time and Operator, for Before to our our through take the to want to to suppliers of questions. way Canoo this partner the I their next support especially please all and and thank our Q&A, take supporters go team we while phase. incredible it the navigate

Operator

[Operator from with first comes Gengaro Instructions] Stephen Our Stifel. question

Stephen Gengaro

things for me. X think I

the And just reduced annual run and quarter your the that? needs ties guidance reduced get to announced you your XX,XXX-unit call, rate. run time that CapEx CapEx on and does today into that getting that The kind rate. efficiency to on as frame the as this progress first, on the of second to of curious CapEx change you the I'm XX,XXX-unit far

Tony Aquila

to from unfortunate opportunity of some we're for others. such buy actually equipment No. Actually, situation advantage the we've the enhanced processes our that taking of

beyond do processes developed have manual you bring and alignments because and In full that have you automation. addition to some can you that line actually so we've scale do as bumps we above the to to that,

to by the the feel Oklahoma to give we ever chance happen if And in City best we've be you area, tour. you So happy a be felt. we'd

Stephen Gengaro

Thanks, I take on that. will up you definitely

probably want on we move you when number me positive, think thing of units to numbers, of other need and to thoughts sort your there? the can you about, you don't The about gross toward us margin me of we updated for the when I know sort think think roughly get was give give precise you but

Tony Aquila

around the implemented. to democratized we've automation breakeven we scale come really scaling XX,XXX environment manual have we XX,XXX the so to of so to others start frontload programs We and and can and We units, and repair on profitability incentive And the the processes the kind of of the methods between workforce CapEx. the we've Yes. orders, That's Oklahoma. don't for depending the what it to so fine-tuned with train Nation Cherokee of state the assembly we we and we have can the manufacturing AI through great developed workforce. course,

So do the XX,XXX- we'll why we XX,XXX later feel that at to good unveil we'll units. we more that a to concentrated range, as about date. XX,XXX-unit but There's the on

Operator

Wainwright, Dayal Our next with H.C. question comes Wainwright. H.C. from Amit

Amit Dayal

you delivery and February Can of into in, perspective? the say, Any XXs in in later the from Is sort XXs XXXs us units for January, and a how directional? then to ramp the year? honing ramping just schedule in give this the on of XXs number Tony, XXXX. will a of sense it

Tony Aquila

Yes.

So voice. hear to your good

second and produced and to the you'll X% studied manufacturing. you going refined the not stick do from, locked we everybody see, way system time of us developed what we've But be that for as reality we're we dual hockey is event in we developed the that stick our is when is how ] stepping exiting so bringing us same we're for all, And because vehicles and a And invitation to than just scaling. well front-loading and that full path has it it the order why seat, imperative it. assuming process they're to logic is see as run scale do less fully throughout you [indiscernible] are method high-tech at methods I XX,XXX-unit that run like coming that's if [ and as exit people MPPX year. quarter, the through So if book, capacity we're that methods to we've what of delivering first is year you in the come training areas line, now, leaning rate. do the it's can visit hockey we while a we 'XX, done the that and AI. But as not as XX,XXX And extend on of automated. announce X I'll will that semi-manual the XX automated units The look entire it CapEx towards, walk it that manual you'll which is we're well have We're

been many factories. to You've

find CapEx you'll things I have done that think we've what generally we it these pretty how loads. interesting some and been democratized of heavy

Amit Dayal

that. I'll take up on you

So from working have when Are for managing the Walmart, to has delivered many how how of customers, around we there of were now thinking XXXX you delivery changed? likes they received, they the schedule terms to still that say, be say, about units certain in in are of units these with them? expectations, cetera, expectations might et and

Tony Aquila

Yes.

a First of scaling as it its which anyone, and and a than when of in leadership and we company customer all, delivery I like very in understand privilege well working me. logistics they demanding bring Walmart better to as the believe, manner location especially team, on better, with had

of been to they've our of we've a level level all in about X X we've customers with super level year different multiyear about orders. we X, done delivery customers a in because So our accuracy them awesome this. And a are worked what through years talk in and how year different is

giving end that. we customers of to to course, reach. choose in us and participate do higher And have, the the XX% gives order to for at If we and so that opportunity that can decide needs, accelerate some have minimum we a of we an XX% to advances confidence to that a us CapEx in

tour it's you everybody to now Rather be So it. willing you those that that for, we're hitting finally talk for because appropriate really try a see than give to it, again. can we'd through stage

Amit Dayal

Okay.

for last one Just one me.

In who terms U.S.? this is you are on investor looking potentially side? mentioned the color of to that any partner entity for outside strategic call, on Is they if earlier on the the you of the manufacturing and with

Tony Aquila

very have all, amount it's of trust. incredible development and of they capabilities many lot that an done incredible they of reasons, work have American XD They which use And large money being development, a I've in more an the based funds several rapid around various we're strong advantage. ally could name of printing for It's workforce amount of competitive for with methods a cases. business invested but this us people highly before. have sophisticated give time, even for Most there's parts at doing, kept on But confident. the is

Operator

question with next Lafferty. comes from R.F. Our Jaime Perez

Jamie Perez

your on manufacturing. Congratulations

me just be your LDVs? going new I going vehicle, it? you Are to sorry. on to take are of that? going little to trajectory Could of reservations also your you pit mentioned you It's the you bit dog, on producing the And Now Pitbull, website. producing that? know be a give color for Are you

Tony Aquila

So yes.

yes, out the and definitely one, come it's behind see -- right MPPX you have a and Georgia the heck we it boy, put see so It's and platform. it. to same So see of come being the here the tour. what you out drive when you'll But

use life. military to don't more for you to coatings. We these wells, use before the frames ladder to the everything and It's You'll much see down designed use, and e-coat. the consumer We we process compares how how industrial MPPX, longer a their gives that advanced built the used much a others. durability --

And the of we'll able produce So reusable. look is you top at vehicle MPPX to hat, our is top the be because front if hat. the just

parts between We'll same using line we're So can multiline-capable it's [indiscernible] the system. because XXXs a build we units spend so LV various XXXs, of the on XX% building and XX% be

of to because, who with do question, to So the that's the answer on from next our reasons a credit Bulldog. limited we'll LV volume are have one, why But we're able may customers will adequate one, maybe vehicle. concentrating debugging are your highest-grade large since we which XXX runs in way the we on it one customers. flow The is LDVs be to the build XXXX, cash it the a customers, high-volume optimize we

Jamie Perez

the of that you My a strike, a issue still anticipate getting labor mean, backlog. do know Are or next you bit strike, suppliers had question. that? of supplies? seeing the UAW with any the the I you Are some little labor I

Tony Aquila

rating. don't as different worked it we taken, we of very running deliveries Ramesh good on said, think We've anything build are days our orders a more are kind for on of because of that a little with problems negotiations our these effectively XXX,XXX-unit unless approach the problems promising were are in I a Yes, accelerated credit it's Jamie, probably people and XXX,XXX-, into typical much because different, they -- -- lot where partnership actually sense the legacy negative presold and has pricing. a

deals, volume. happy but to the recut who's So rewarded [indiscernible], I are to ring partners special shout get supplier why we're we of them because, a to and as out somebody I able mean, to the next kind I gave those not do think that's for find only not actually trying out

BOM So our and versus fully to level and automation that pricing continues our more costs manual we a but at more get moderate address at all hybrid better automated. much a of

margins those dramatically. as up, lines So come improve our

Operator

from Poe Global question with comes Partners. Instructions] Our Fratt next Alliance [Operator

Charles Fratt

convertible you can just options same be about the Can the It potential forward? then million will convert preferred part your that? expired. the won't debt your more then just then it issue timing that on raising investor? going just of you of be be And part strategic And -- capital of you your just talk funding forward? looks like next confirm talk $XXX And any with going because won't there about will the mix

Tony Aquila

Yes.

So that some will sources. from different come

I that will as mean, We these customers that provided are earlier. I about they're real, and revenue. grow talked revenue, prove right? generating times, discerning that we're revenue very right, started we interesting So And quarter-over-quarter. needed to

that. to needed we So prove

milestone-based terms. And extended appreciate now. think order for it, also to start hands, well from money breather helping funding because mix why, to we'll for young companies company have a that take just-in-time to a come what willing us. capital have they will strike do me our So and And do, opportunity continue supplier with come that's And value been in the the back them or perspective, below I look from right books at I book from derisks tremendous it's them. mean, the others, a our to to now in as and deposits we'll whether again, trading we're I'll fund that partners, progress as at

So as to we're extremely. And just and the investors, come prove swings, know, pendulum we around. those all always we long-term ourselves things will want

So visibility see, good to and to of 'XX as we see about based the we we room of the improve today. for guidance we're on through macro giving environment we're everything step us feeling lots on

Charles Fratt

amount Meaning the out a coming Can just other about talking understand dilutive attractive. you certain were for nondilutive that of that help term you me you just the might can less with levers are there you to can clarify? On the financing capital some last expect tap capital still that pull. Or occur? were terms into? of there sort in potential and sheets call, the should look we When

Tony Aquila

Yes.

phase with customers. So glimpse deposits, are allocation right? and fact that our in these into an now in gave you is sizable also to nature I And a we're allocation the approach connected

a we volume that strategy And markets and the as always shares. have starting side. growing and -- just it's your tell the is long-term realize long In market addition mentioned, and it's towards not obviously help. I the we our not about to that liquidity will team strong more that announced that, price great a ago, terrible time It's it. believe I liquidity par, about we below are trading in to have of base of the that we about is

So see we to that access capital.

capital to that, are that are cost to more you of that payments addition we In as you are of much and associated other more to. And associated big advanced capital the with working get the sources there contracts. for contracts, of programs that various those win lower are

interested in selling capital to capital long-term put and In addition PIPEs is areas. aren't other the that, to ability in that there

first set We our A -- have starting very from credit we'll on. now credit, great incentives year. bankable we've to when our get And POs incentives and get got advances of the BBB the first Grade flow to of spread, in into

on amounts before in of as you time. to the with that money own of market and the we're all the a vary have that also of our makes invested In a we connected a strength It's And the think it this, get balance the much on it's burn tell of early units. a I of seeing is make balance of phases, sheet them capital. behavior amounts get focus where this I -- cost been whole become big However, an our long use phase sheet. sheet ways they balance not to all we rates. creates can the it the sheet. so I big pay to that's and are companies, now we like That units balance on dollar less want would capital, company raise big on when the inside it trading frequency, the is question efficiency question wasteful. When have can they you often we as investor doing you I've small you, But capital a customers how the what ask is the

Charles Fratt

million you've to a you the do for get that? million to more I'm of or required you looks if math, And you going if fourth of -- so to capital how end is can And sounds -- then take be coming roughly enough $XX secondly, $XX just million the targeting Is production year. it well, $XX the get the stab Great. one, capacity. to like is the and that's CapEx to XX,XXX-unit you at, in between rest quarter asked million like sorry, Can the you're to XX,XXX-unit that XXXX? much you I for capacity been think production it $XX

Tony Aquila

Yes.

we're not does for take some invest some capital had before another effect million. buying dollar we'll a the stuff on $X.XX perspective, they of customers. CapEx from the So about the That front-loaded of and some of less that $XXX

that. So different we're come have using techniques. I sold the and I good don't of that We you really again, understand to use show a phase, we're the market. to in a we of company out and e-coat. back. way background painting We plus years creativity a of coordinated happy visit a PPG

accelerate automation. our capital. our process XX,XXX-unit able this obviously with point work we So a really exit rate, customers to to in at we could ability want perfect the run At more been we've to see put which we don't if we to that time, need because because for

So go lot be the that goes the a we together, line able obviously, those to on margins and amount the we'll the see by of XXXX fact capitalize democratized we opportunities. up assembly use capital. We least our of way

it Some think very for timing. reason. if the luck, of very pivot some you back it's the beginning And occurred specific to a occurred, when of it's

got of that money for think And we why a has up. it that's in democratize that. like concentrated find able you down to in You the something on. I they're don't always we'll your I XX,XXX-, couple been a not to quarters, build business because we explain make you'll did range. to to anyone market And said, XX,XXX-unit

Operator

Our next with Stifel. Gengaro Stephen from question comes

Stephen Gengaro

Just a you the at are and that are quick sort the for the now? the between you were follow-up. driving year When factors biggest improvement, EBITDA in where and where of what are the you change delta guidance look

Tony Aquila

has So deals contributors. our team it's lot a -- our been of They've with huge been renegotiated suppliers.

Oklahoma. I utilize labor CapEx. In able will, Cost it's reduction of it. those to in great. addition you our I also for if got We've a seen better to been businesses, upside an mean, workforce to of them look between all we've living amazing Oklahoma. and that, arbitrage state California, lot in the a encourage strongly is and have at that of It's

out like it funnels picking when places. all from the all think it reading So but we're water you're from -- the up -- the like coming it's and of down center to

Operator

management no this time. the And for back questions floor remarks. hand further there I'll closing at to are

Tony Aquila

A the instruments democratized supported with have investors, equipment us Again, and those to that out needs, introducing our line build-out, a we'd of on with system see shocking a to that more for material bring what much time. for Thank first our the to those that out partners shout you. the and And our and ecological us is us assembly of like thank believers shout that that big come helped industry to of everybody. big that the visit you'll you continue us, is. work to some

Operator

disconnect. All may good that And call. concludes today's Have parties a evening.

Canoo (GOEVQ) 14 Nov 232023 Q3 Earnings call transcript