Earnings call transcript Q4 2022

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Operator

Good day and thank you for standing by. Welcome to the Hyliion Holdings Fourth Quarter and Full Year 2022 Earnings Conference Call. At this time, all participants are in listen-only mode. After the management’s prepared remarks, there will be a question-and-answer session.

I would now like to turn the conference call over to Kellen Ferris, Hyliion's Director of Investor Relations. ahead. go please Kellen,

Kellen Ferris

Welcome earnings Holdings’ conference everyone. full quarter year XXXX call. to morning, fourth Hyliion and Good

On the Officer. call available Executive accompanies Officer; today conference on are Thomas Jon this website our Healy, Hyliion's Panzer, Investor Chief at and Financial call A Relations presentation and slide is our investors.hyliion.com. Chief

Company's during today's that make note outlook. we will certain business forward-looking Please call, statements regarding the

such projections that and to predictions, forward-looking are cause and subject as are assumptions call. on statements about could events on other statements and Forward-looking anticipated differ risks expectations based current and factors the uncertainties. are to statements this materially Many from results actual

information filings differ press and our Company's more earnings For such with may Exchange as Commission. refer factors results materially as well the to cause release to Securities our the forward-looking about that from statements, please

the as are speak of statements date Forward-looking they only made.

information we law. statements. duty are to reliance on You forward-looking this required put undue not undertake no cautioned unless And by to update applicable

Now I call Thomas. to over will turn the

Thomas Healy

you And XXXX our year for quarter morning, fourth everyone. today us full for call. joining and earnings Good thank

We and we've the plans past made the to lot year exciting XXXX. with progress you over for of have share a about our news

that milestones quarter full year. key the achieved and review for let's in the fourth we XXXX First, of the

testing. hit milestone winter power path on by to the train commercialization We starting another ERX of our Hypertruck

guidance full for the the completed ERX XX first XXX up bringing of units. latest Hypertruck year We the for year. total revenue achieved added revenue slots, also production We initial and orders generation our to another

Cheri We've our Jon including the advantage by employees XX will which generator workforce Officer, fuel competitive by we Lantz. Chief Panzer, year having agnostic a In over efficiency, KARNO addition, acquired our Strategy CFO, us technology, the a and our increased high generator. during give

and recently Jay role. added former Board over the our he the took also of to of Craig, CEO Meritor, Directors, Chairman We

scale and help our to them PACCAR which market our solutions also Cummins, more both us bring expanded relationships with quickly. will Peterbilt We and

made the We progress on great as well. regulatory front

included to Reduction in mandates, be adoption Advanced and significant These we have CARBs Our truck expected Clean the accomplished. and technology Advanced and we is clean OEMs are Act all for define fleets. for and Inflation production which will achievements, proud with are requirements Clean Truck Fleet and qualify what

milestones. Shifting back ERX to the Hypertruck powertrain

and As a consecutive XXXX, quarters, reminder, we milestone timeline have schedule in for hit we shared commercialization since then. back initially this on every five

another pure vehicle. to encountered while over most in which due more our box by expect During range powertrain to components, do We've can commercialization opportunities battery plug-in on a year. where distances not far. testing, CNG weather. reliably impact putting plans and winter the we start greater Because initiating vehicles Northern some includes than environments, really electric checked of has with our thus production paces our we've today powertrain operate extender, its it through this been quarter, And we cold later we've struggle roadmap results anything the our powertrains experienced commercial to the a adversely pleased strengthen to

next used testing will but winter through go to development are incorporate trials continue we learnings. summer the initiated testing, and past of also to vehicles expanded XXXX. completed new build Having all testing, will validation These that throughout fleet be generation beginning vehicles for

I'm to we certifications our year, fleets. the track NHTSA and expect of obtaining CARB, are that the year, towards start for head commercial units the late second we also share pleased we milestones on before be delivering to final which production half to As in the in of EPA

it's DSV buy the of solutions, shared trucks they out deployed to in focused as logistics units a with with largest such world seeing U.S. for one us the DSV reducing with third-party an customers demand option Class received trucks companies in Dallas XX these more. ERX we XXXX, its offer the XX Late an is are for and ERX to from Hypertruck emission with of that region. their on order expanding system. Hypertruck X growing DSV business powertrain

customer DSV We theirs. with are them and excited to work continue to we growing while base, our help grow

is freight. We’ve one Council also their vision controlled to placed initiatives additional member, an only transition climate fleet and also shippers. for they Ruan of has but committed more continued is one Hypertruck largest execute order Ruan, XX trials, change slots. to for goods Innovation not production moving completing recently with movements of a sustainable to Ruan to a

of additional to but we see would continue placing go us prior firm to our as or milestones expect that see in backlog through participating production year. fleet they we development Hypertruck therefore us, We believe late like fleet are in we reach we orders the goal customers interested approach orders. trials more from slots. fleets commercialization have will the powertrain, our to for to told grow additional orders ERX As trials, in other Various

next an our on Founders I provide want Program. to update

mentioned call, to will white-glove our the and We’ll have Dallas and service ensure support our these calling a we As are service deployments Founders launch trucks, experience. a of on Program. provide positive region customer our trucks, last in to initial facility

later needs more are to progress. make look location we XXXX Dallas We share we best and in the our researching in facility as for will

the of facility We as also Texas. customers new location, the at will in Denton, be certification to plant anticipate line Peterbilt deliver we the trucks through where launch go they that end

update. a to Shifting regulatory

ACT for same provides Fleets. that the are for tax CARB truck drive a reminder, initiatives the is vehicles the Act, The and and a in there OEMs on incentive Inflation that to we a powertrain The vehicle a plug-in credit mandate a or Reduction As CARB qualifies and of are ERX $XX,XXX zero electric credits with Advanced a Trucks incentives as pursuing: Advanced sale Clean years per vehicle Hypertruck IRA production main three CARB ahead. emission truck. qualify Clean

as cell qualifies for. qualify similar of mandate on ACF to purchase system a XX% truck plug-in for Hypertruck the truck ZEV ERX still or Hypertruck will a for fuel is that ERX value is but regulation, the of zero our cell truck. is the or it same or zero to emission According as XXX% qualify but the credit stage, in to drafting fleets ACF BEV credit a this a ACT, will product ZEV the today, fuel electric or trucks. stands near

proposed some charging trucks there associated a or not of recently purchased. documented can CARB’s exemptions with purchase, delay fleets a available In a seek clean the to are if for ERX will either with fleets ACF confirmed exemptions offered the not if delays changes that to policy, powertrain available where is with installation be compliance are infrastructure. be on-site Hypertruck near-zero if meeting, recent to vehicle, like truck to CARB emission

as vehicles, and shaping is the that sustainability are electrification policy with our We trucking ACF transition we goals. value believe to range extending of electric cleaner pleased the recognizes in how CARB’s meeting plays operating powertrain up, system broader

are as cell development under gears, a we Shifting truck XXXX, a we fuel that collaboration off undertaking kick announce agreement. the are to of we excited

agnostic replace that we for engine a generator. range know, the you the more KARNO As fuel with We powertrain have efficient generator. with roadmap extender as showcased CNG starts generator the then three-stage our CNG a development hypertruck

in as is And supplier announced manner finally, In XXXX, availability our the we agnostic the transition to evolves Cummins along CNG powered we time, for a to clean that need We to a transition powertrain fuel aligns our and cell truck. roadmap electric with the that also our fuel And over engine. charging of believe sources infrastructure. solutions solution. fuel KARNO unveiled with

accessories, of the retain most also software the including leverages most entire and platforms, that vehicle our same the batteries, to electric ability axles, controls It system. components the across importantly, powertrain the

for vehicles, see the occur fashion electrification the we we hydrogen market will trucks. based CNG prominently most hydrogen a of used fueling source. range designed electric While extender Initial evolving believe towards around also new in vehicles to regional a will fuel likely locations on as the support in adoption fuel be near-term greater

our Hyzon’s is cells a fuel powered down, electric adoption Peterbilt to in Hyzon regional Hyliion shift that announce of chassis. expect to partner haul. more development stations of Together, and built vehicle. long Therefore, comes the integrate out we fuel Motors the cost powertrain into grow and collaboration As we the are and see pleased we applications are hydrogen include will to cell from the this system

industry an powertrain electric the developing in production in solutions. cells leader industry is an of leader Hyzon is fuel and Hyliion

truck are excited vehicle to powered We teams have years. in working we that the a develop predecessor together our be fuel hydrogen commercial to future the of a version cell to of a expect prototype

We expect this of complete to this year. later truck the development

available at in years trucks sources a portfolio for we cost By with strategic in new in cell demand ready to fuel advancing coming Hyliion fueling the are be of hydrogen become positioning our as growth hydrogen powered for solution, the markets. lower product

the this year. opportunity cell about and later with excited collaboration this technology. fuel are Hyzon its team the We work come More and to to

Before this handing December long Ed take be it an after Chairman Jay Ed excited did of over our our his investor initial in I'd and the passing and Olkkola, for we're former not Jon, at Board, who Chairman was but He me role. XXth, contributions like of He Hyliion. Craig will success a away for With taken moment was and Chairman, his our to our for to have has fought remembered. am over mentor in also a acknowledge him to passing, leukemia. to extremely always only to passed Hyliion. team everything grateful to on personally the as battle I a with the

call And the I with will that, over Jon. turn to

Jon Panzer

and Thomas morning you, everyone. good Thank

ago in in a to of in third financial a excluding that results systems, we quarter we quarter, outfitted normalized lower $XXX,XXX operation Operating recording we reported three financial totaled in $XXX,XXX from quarter expenses after $XX.X in also than our the our for to first acquisition to note to of a September. full sequentially want million the we year but the are this million $X.X this for third quarter with Hybrid I Turning million the up the the expenses the related recorded $XX.X quarter fourth the the including of revenue the the We fourth from quarter. million and closed in compared KARNO of million time reported year for $XX.X quarter $XX.X KARNO sales, ago. impact accounting the Hybrid XXXX, of is year trucks fourth results.

million accounting. $X after million, about again but impact $XX.X of from up the down KARNO $X.X totaled excluding R&D million quarter, the from the expenses prior XXXX, purchase

$XXX,XXX for in $XXX,XXX down from as quarter million, to starting were growth level quarter, up XXXX the on the spending expenses SG&A overhead costs. but from the out third $X.X are we

than Hyliion million $XX.X we net of quarter, XXXX of reported by nearly XXXX compared two flat for were of in loss the the and In a income million loss quarter the reported is $XX.X our net interest periods, in the which mostly fourth gross XXXX. million Comparing loss higher total, fourth offset but on were about expenses $X operating higher investments. smaller to

$XX.X was R&D and expenses accounting reported Sequentially, third income. XXXX we all our lower loss higher than loss, excluding the in improvements loss $X.X lower of million quarter lower operating gross KARNO including in of interest areas million the SG&A and with

was line guidance with our Turning trucks. systems full year, year. now million revenue for full to of $X this million revenue Thomas most sales recent Hybrid approximately and in $X.X mentioned, of in the Hybrid the on is

in which Looking $XXX.X in expenses, million results, total year the XXXX expenses adjustment the were compared all mostly excluding $XX.X full KARNO reported The expense at component of purchases additional and for were more were than and Hypertruck XXXX. operating driven in and in side higher in our testing million to XXXX acquisition as in and $XX.X $XX by powertrain on by R&D development XXXX units in million, XXXX. a system, we expense year R&D trucks million was well driven plan build work to development increase built as we ERX full

ago. in million year to Full expenses million, net was delays components for than were XXXX note recent our mentioned And lower $XXX.X XXXX. million, loss up full services that $XX due in I compared that year $XXX I earlier year most forecast that to million $X year about million R&D XXXX. operating $XXX.X $X.X totaled primarily into of were pushed SG&A million, million and from expenses want to $XX full a of

period long-term $XX with third investments expense. the almost of million, We period million entirely ended increased the compared the a during prepaid accounted net and and $XXX quarter loss to about the of cash, with by the short-term at of cash million our quarter, also end use for $XXX in total insurance

of in we we XXXX, commercial Hypertruck expect $X.X we revenue averaged with full the into forward per ERX Hybrid XXXX, move Hybrid to systems as rate of continue system. to Looking installed systems same quarter, quarterly at towards about trucks deliver million or about launch the and as

the due production ERX versions recorded of to to system sales start trucks Initially, Hypertruck this at expect with we our margin be truck nature positive quarter cost commercialization components plan in year. sales these of assembly. margins. to of of time, the be do we delivering gross activities, negative We a Over our fourth including to startup procurement the driving reduced, our expect and

operating $XXX our to range. more full also continued towards $XXX million Also expenses, XXXX expenses delivering We level system to and Hypertruck ERX XXXX. as growth in we in testing from we off estimate in trend support. largely research are million XXXX late SG&A continue noted year and the reflects beginning to expect commercialization focus our development activities which a but expect earlier, to This on the in transitioning be

to system. XXXX, in continue for grow outsourcing cell these collaboration additional fuel the KARNO services. spending that our reducing to is simultaneously our platform projects on other engineering in-house generator, development resources our XXXX with and projections the Hyzon development leverage ERX while work development Hypertruck truck for Included in and plan of spending We program

reduce activities have Hypertruck last collaboration ERX to that to project. for Hyzon commercialization acquire that development sufficient that powertrain as well months, and to XXXX, for truck parts the planned deliveries. product as in of some later will the believe to supply primarily continue for fund delay working of the By we year. resources current this We quarter risk needed capital for chain our coming expect as KARNO noted trucks We assembly our the production we see increases for we in issues financial activities we components start beginning initial acquire

see product generator, in work, Finally, cells. investments a we year, assembly truck and the to out validation additive increase of KARNO in headquarters the facility, capital our an build spending printers as to Austin expect for support construction test including facility and we

to year, we cash to we still used XXXX. million the working Although build in spending is the less $XXX capital year than be early and our $XXX compared it in to support used in expect million inventory total that operations, capital

it remarks. over With for to I that, turn will Thomas closing back

Thomas Healy

share have remarks, a few to you. For our we updates exciting closing and events with

to we exhibiting First, in we California the Anaheim, at be May. ACT want highlight that Expo will early in

Hyzon’s generator. We'll the will KARNO our we proof-of-concept displayed. time have been our into the generator KARNO ever well first hypertruck. ERX utilizing the that both has and as KARNO We integrating as technology to will will This have truck be also publicly At KARNO Hypertruck showcasing cell initial that technology. the see semi you will in be a opportunity fuel a show, booth be the a

share are to connect We excited industry leaders space. the and with in our the with other progress

generator not ease about help produce solutions can the I participated Davos, January, or a charging World infrastructure grid KARNO is to panel support early grid in Economic the the at issues. in a and is model, we In where distributed spoke in Forum locally how able like charging the how EV to electricity

spoke trucking. about watch channel, hypertruck vehicles panel infrastructure EV size are the can as range recently avoid also many you the problems. how what We as batteries of educational on needed like on discussion We released for video our help to the YouTube our encourage well truly extender

our at we Texas Lastly, conference headquarters that investor an will we hosting pleased are announce on be to June XXth. Austin, in

about existing all learn technology for the some on. our our and are future and interested and advancements of will working to be electrification. attend We investors our showcasing parties vision future We the of of we encourage more

year. we over very past the are with the we made conclusion, progress have pleased In

With our important we confident regulatory sustainable innovation more strides. collaboration, our We expanded have are lead on the customer significant continued towards to future. and focus efficient and in base ability and achieved our made milestones, industry a

operator. Please we look ahead. go will you questions. Thank the you to to months ahead, on our for your that progress ongoing and open support, call in updating the With forward I

Operator

Instructions] comes Bill the JP Morgan. from [Operator line first from And your of Peterson question

Mahima Kakani

you potentially Hyzon Bill the launches This if fuel taking for is us Thanks timing my the little the the more could Kakani about KARNO and/or collaboration addressed? cell morning. a Mahima between bit on markets please questions. and Good the Peterson. change tell key Could

Thomas Healy

Sure, absolutely.

to we're market CNG is range you cell working going extender the the on the be then, coming first solution. here as as ERX, is Expo to development first fuel vehicle to on which That already couple In parallel, a So showcased of at ACT going just the today, announced be vehicle. working development Hypertruck in know, KARNO we're a And we've well. will as months. start

a the go those regulatory fuel to that that terms does cell solutions, it's we just that bring have So, compliances less to in through timing to one order advantage of of need market. solution is in

So, schedule there is there. development the some acceleration of

timing we'd that because terms incorporate actual initial Hyzon to that the ready to out, like and of just to what of fit vehicle, with we're really showing work the when our to able to In market market, the to share range proving this to how then market powertrain bring be of is bring there, from can fuel customers be. we just the ready KARNO that not it development around the extender agreement to and CNG, that determine a with is solution generator, timing see incorporate a we'll would potentially we'll best solution Hyzon cell, with and yet showcase the

out, the is be solution bringing to to market say on easier the and year. side that'll should of one later first means, and is tailpipe fuel because your to in just of production all ERX end. this start or emissions. barriers more on of focused But less cell the team by zero to things the we're are market that regulatory I come as there But is pointing So, question -- a bring

Mahima Kakani

as the to maybe forward, of is follow-up collaboration, then, Will that or say it be expectations. primary that cell the fuel let’s the of larger a hydrogen kind proof And from meets strategy a Hyliion? Hyzon strategy of concept is that part

Thomas Healy

today, higher So, there only hydrogen are stations is, the fuel of pretty semi even right? And can even where a question you much, where refuel hydrogen we future, when, we've just as a a on actually than think bullish probably the still sit a vehicle, diesel, see truck. been being as hydrogen I much biggest out few we here but costs is there's

So from expect areas. localized hydrogen be there from we those from kind as And fleets that standpoint, and to in really interest we being a delivery. of see fleets demand

But for country the natural the we being trucking, definitely real, gas, especially and the gas like of over the as vast fuel of choice. majority renewable see road natural

we including because to already we're millions a a miles is to expect the So, going that that in CNG make hydrogen when maybe of that with is ready, And that, wanted at have we've is a of time, -- we to and the solution piggybacking the and criticism built why costs to reasons the we’ll we out, some range a going roadmap infrastructure be we are or of that well, as hydrogen -- that by gotten we we've roadmap gotten of a like, out powertrain on that's proven even able we have be going contender company, extender. millions --whenever in want marks come to available? cell gets fulfill show be question true the, ready as stage Are had one fuel to down, those when past point? we sure three

space And well. the to as be strong showcase we're so, a contender we in hydrogen want going that to

Operator

Cantor Sheppard Your from of the next line Andres question comes from Fitzgerald.

is open. line Your

Andres Sheppard

quantitative question bit the and on taking questions. the Thank you. end, on quarter, thanks our side. Hey for on Thomas, our a Quick congrats

the are orders, end as a you you. year, margins of of from have expect more by XXXX more turn we feasible those, which should this perhaps how As be production, realistically gross envisioning XXX margins? year, startup but timeline? Now, as be don't you half we second and this was or those positive -- we the should increased a to thinking we Thank about know guide last I quarter, approach you should

Jon Panzer

take Hi. Andres, question. Panzer. is that this Jon I'll

that this truck be we we're So, mentioned the commercializing going to later year.

what we're deliveries making So, or we to how quarter, start don't in know going sometime fourth many. date exactly the

positive assume we wouldn't in I So, XXXX would that margins. see

lower with be As changes higher we them And that's actively when turn volumes. there's some the from to out, those we're are also positive. costs But and inefficiencies you're to truck. assembly, and better going working mentioned, engineering the starting of procurement component more purchasing to efficient just in

too number be -- little one So, our truck, early priority but a reliable our delivering future. can it's to that's for besides the you sure predict, a that's bit

So, it's when exactly little a bit be. to will hard predict that

Andres Sheppard

of on this a have you, you Jon. bit entire disruptions as That’s problem trends more Thomas, maybe is, Maybe for chain a Understood. you side? helpful. the follow-up, I'm the have Thank curious. supply obviously, what Maybe little supply Right, been one for been kind seeing big industry.

Just curious what you've thoughts maybe and been for Thank XXXX? any you. seeing

Thomas Healy

past to lead continue lead seeing hurdles in their times. -- times told markets couple starting seeing us way. some. to definitely in they anything, lead If the the we're time. They're and seeing moving We're the go not those some I achieving definitely the instances, it's suppliers guess, extend other supply the years, easing we're the the of that of in So, over were chain place

it think everything's to we So, and see see head thing pricing is was, on where level pre The reduce supply base it we're to the heading our start of in chain or direction in I start obviously to markets. next that the going supply market. with this to right kind push supply the the back this hope of to was towards shake-up the to

So big one that'll our be pushes here. of

is into hands, forecasted we're and interesting another get question customer the we've lie. kind BEV fleets And to we're in going demand really little a see really struggling to these is abilities the market been and the into vehicles, focus past more out the of are question hurting charging where things seeing is what's our the having great. to the is -- of this out bit vehicles customers’ a that starting get which parlay with just of topic maybe One is to on things, this it causing massive just, in be of to then issue, more as fleet’s uptime that amount return factors the being of seeing and infrastructure, which that cost are spends vehicle, just all these the time best the they're is the BEV solutions, adopt actually into that demand solution recharged, are

And were of some senior And not just to an after their actual executive that, put BEV, was, there many did they while with ago, vehicles. the into comment the who but and BEV solution to long adopt came fleet, the never too story very to with headaches very we at BEV, he's with they vehicle vehicles, another operations, us adopt some because see they being our will practical. had and plug-in again their back their experience as just BEV the trying hurdles company, adopt how to

the definitely. path on for are most positive news some we that's So,

Andres Sheppard

there. helpful. It's very start one, just one needs, there? Thomas, us of last any squeeze you kind your your color again context, in. capital funded is that expectation remind I Appreciate -- production, it through Maybe additional of Obviously, if but what on

Jon Panzer

I'll Yes. This Jon that. summarize is again.

And $XXX we us So, capital think that the balance our liquid when so it spent, million on year. available it. need of $XXX roughly be finished million I to was with we sheet, year assets we last will

The by the this we year. of many million trucks just how sell there also build the end is under our We $XXX year. somewhere capital working and unknowns spending guided to

So, south million. somewhere $XXX of

to -- year So, that's going over we end is the million $XXX leave are to us this our of going projection. by

So that us leaves in shape. good

a start to start us we any puts to year up it ramp So, this all we have plans no as even position capital great to and in XXXX, raise sales.

Andres Sheppard

Thank on again very Excellent. quarter. the much. it on. Congrats Thank you I'll you. pass

Operator

Markets. question the comes Donovan next Northland line of Capital from from Schafer Your

Your open. line is

Donovan Schafer

Thanks by questions. to know Hey, early passing. firm. offering I want condolences he an do just in the investor start the my guys. taking I actually for around was Ed's off

something, role he like time. a time. long even COO XXXX think there he back of for stretch had was of I I for think know to a or it sort like And goes some I

missed. sure So he that will no doubt, be I'm

So I just wanted to pass.

Thomas Healy

Appreciate you. that. Thank

Donovan Schafer

questions. So turning to

XXXX, what -- guys ramp about units, ball like all ERX hinted of and think guessing, anything to the initial for I some crystal in Hypertruck far or all capital about For we you the But, second exactly working know like chain that. with to you give some ramp, the this and and on would thinking third sourcing Hypertruck too have XXX it, early and supply of of love of that. fourth course, us a it's following on looks guys ERX XXXX. you guys quarter, quarter, for XXX I'm for quarter talked

need need need place for where decisions? the forth. QX points those QX, able What's some year and if to point what the to please like, in number so own your in you can, do this other do. what the to course, when to Of like of procurement units need view you gating know points internal produce at to or if not, you making do to is, have decisions procurement you of But I'd would start making start things, would be decision? When -- and you

Thomas Healy

Sure.

So, too, in we hinted kind not you are question, share it at XXXX yes, point. led as of with just ready the this for volume to expectations

out team. just terms buy We that to of in make to going that up great are of part XXX initial the are we pre in to But of procurement we as some ramp it time. the set by delivering we we earnings question, XXX to of end sure of a mentioned, those achieve we for work things plenty trucks the were because all it's great you starting shared be going calls, make them these QX sure the to 'XX, very what for in is which of had confident a past vehicles and of hard

based a varies but on components, six-month fair is it markets, usually chain probably a Supply bet.

longer are components Some than that.

mark Some with use I are much when to customers. of that the orders, analysis making would for of before actually But when need to shorter be six-month kind placing deliveries in terms need kind would of placing we purpose, the would be than so. we orders that of

obviously We're we just relationship We're good those working trucks, of XXX Peterbilt well. is initial closely on in availability and end, and very the working builds. that highlight shape feel with confident one through to Peterbilt going And thing for the there.

to with was just milestones we the off Hyliion. them. Peterbilt's de-contented a make And internally the for specked of great actually, for truck that big of progress team the specifically of did was continue line first build one here We recently

So, of as here, were those or and and kind we've to taking then taking them were components. having we talked in the stages, about sell those off in discard full the we early trucks, components past, of

Now, we're from forward source be, continue milestone. move chassis them grow with And that directly expect which here. to is trucks to we to need being are to relationship huge able -- built we moving forward and as that how to a Peterbilt we

Donovan Schafer

I'm some In I that insights EVs. or something waste the summer sure testing. cab, And weather, with some And then, it's how of points curious for performing where testing, vehicles the the the from with winter like it heat maybe already And you sure lot amount gas start full with a just consume that for this us frustrations testing. any scope winter know testing, finish far to various color I'm like so But given get heating, to of an about the give but the not if the generator, cold for been it there versus winter testing, are begun assessment. assessment natural winter from the you've have to finished. you was that. has some have updates in yes, also, or said new I'm talked phases or a that allows complete, you on have you any incremental would energy you

heating a internal engine. why that's So, in problem isn't really an combustion

and testing, any comparing far? and curious, incremental so So contrasting winter, summer seen what from you've benefits updates just

Thomas Healy

Absolutely.

So that of a parts few different question.

now, is have So, just were the going we the some we're design. starting start is. hit some getting on in this off continue still pictures of ready it of So, updated just already for design, ongoing? the and are middle road. road, Actually, improvements vehicles out winter design as yes, noticed on. still it right we're of made batch the we to the the call, Actually, next I'll to we truck to with it the been new Actually, there's vehicle. that The testing

have underway. continue. to But already excited will we're So, testing that

terms testing In right? learned what philosophy to want point far, you learnings, to things break there them. we've thus with The the been have of that you is push

figure points you out weak So where are. the

that we're I we're made say just thus go found that that. will So, testing rethink But to nothing the far what have on. we've us and back is timeline in doing has

huge improve, though. ingress, the sheet a win. metal to that's were to been major improve areas, from designs nothing to learning But raised water learnings improve that's have things have -- So, of that like connectors

help from, new the and the winter. As that of components well years, of as of the been around well we're those or learnings designs some feedback their we've for even give to companies electrification as of whether industry sourcing had well components. of bunch they're been able they're and space. into suppliers in the iterate on brand summer last new a continuing -- newer kind versus them to to but then was question your through part the But We've to established

of as a normally batteries is of you is electric very, because actually I for need think be battery to to thought don't capacity vehicles difficult batteries very it heat to like the and because cold. lot being use winter your

gas the of to as with cold that attributes performance generator doesn't weather. a natural does BEV. And much can It during of see of help affect as One vehicle. things be it nice have our powertrain don't the the we that much the as powering is as as thus, actually electricity negative you we out pointed time to we advantage, an producing use

with the overall, been pleased So, though. testing very

Donovan Schafer

Okay. And originally Program, they're last then, production launch if one tied for slots about I sort kind could the in just of squeeze and the XXX two -- to there's the Dallas. facility the Founders of, question

but orders of you've be that to is and we Program, same that they so idea get that Now, XX and the remarks, relation come in, folded incremental by got things I get as that ordered you going and you kind everything Dallas in those additional to just facility? in monitoring out the with talked incremental Founders like were white-glove your are to DSV, think at the about clarify kind prepared highlighted initial of hinted XXX that think kind of orders we XXX, and treatment to to Program? into about that a initial servicing add that of of on incremental units wanted Founders how as

Thomas Healy

Sure.

fleets Dallas were the with through to that with vehicles out these anticipate going area to facility. those the initial to the they're coming be those we be vehicles that the make of Dallas launch Coincidentally, sure to going well. XXX operating and using we is founders So, DSV, be as worked and

to going vehicles, solution Dallas available So, as just that to to with forward, to the the it the fleets use of we their be country. in we're But launch and we loosen wanting assist addition. through constraint across plan are coming sure go going make a to that's make really facility

through at. if going we there, some more to just identifying to of Obviously, a going that is we're fueling can are just process fueling color coming a options, Dallas, still we're facility. Dallas, is fuel fueling then where nearby also up fleet the use to located, exactly where that trucks And in having launch in that versus site put on facility exploring, the station potentially be having

or area initial location. good complete we'll when ones on a the and in those the fleets we're are that launch So, have Dallas we of to all of out supporting be that trajectory this later year, by vehicle, that other

Donovan Schafer

Okay.

idea about about of talking glove, service, talk doing service white potentially that like you as you a you markets, in type a where it intend is XXX. want involved. service here's this something make then actually and that's flawless so white-glove learnings when not available. a So, really elsewhere, the thing expand was the perfect have everything just, to would this first oh, to and We It's all the other

white-glove just XXX. the first it's So, for

available markets. forward correct? least than -- Is want other actually to that's something option have that You going at as an in you

Thomas Healy

how to a to were just about maybe put of So we it. try little thinking more color to it

are it that that as design we see So get for where sure as failure much points the coming we that make to we possible XXX, initial no of these there first is robust, off learnings approaching up. critical it's are vehicles the

issue. working is So, as experiencing the tracking are any perfectly what the to sure even data they fleet anything. -- eyes we see and going to we asked We it be it's the don't if would working would have is on truck we visually Obviously, fine, still vehicle XXxX. expect get the want we aren't to that make

the with we trucks. initial have those of kind that's So agreement XXX

scheduled there go we we the past eyes routine that, that's on issue an to be vehicle. the only there was be the if As going goal a on that maintenance would or if vehicle, are getting is

is maybe kind truck. we that's of maybe white-glove the normal it's so the than with the an more any other want XXX, would like more us versus on would of of the to arrangement the production technology And use be creating we normally into fleet of kind involved difference after we they once, the where volume it are fleets that's

Donovan Schafer

of helpful. I'll That's very, take questions the rest very my you. Thank Okay. offline.

Operator

from Instructions] the next Your line comes UBS. Jaroslawicz [Operator Avi question from of

is open. line Your

Avi Jaroslawicz

guys. for Hey. on Steve Good Avi Fisher. morning,

OpEx questions year. So, Jon, this couple for I on of think a

maybe be for to just year with So, terms expenses, how towards but the I does And that part commercialization geared then how R&D about can in year some expected bucket the then or versus of of future mean, this also the year? year off, R&D flat SG&A and thinking products? development leveling know one flattening we for increasing this of last out be you kind should much of is of from is there?

Jon Panzer

Sure.

there reach all, of on where larger starting and we first that build need to are organization. don't the side, just SG&A, of is So SG&A the really the lot we maturity on the Company, to of a side guidance the indicate administrative to kind

And -- it's just kind it question, but we so, your out. hairs I of split don't leveling see want to to here,

at hey, and that. take that's fourth like give You might or quarter a look more just say, number

Of it It than little XX% grew bit. last looks course, a a less grew like it little year. bit

So, be to look that fourth at. point good quarter just a might

of opportunities I just it's or focused we a versus way side. expand want don't to it, saying, that focused we to we right just So, don't hey, again, the could but now. on And the administrative grow, overplay see on we product are are see R&D, because

in on making are field. testing we we into talking the and then the R&D, have Thomas in to certification terms R&D support sure from just product we activities that and then about was over a commercialization support, shifting And good that of can

shift project, over, zone the that starting some shifting over certainly high are We to into KARNO. of to R&D

conference more other we that to other later investor talk some about And products year. and we things, get will the our when in opportunities

it's other are not too to value the it parse There's the and lot yes, out we starting So, commercialization going of to definitely get to shift. things and to to finely. on a trying point start exciting in as things do But we shift truck.

Avi Jaroslawicz

the regulations, of can discussed it. emitting tailpipe than And lot. to generator? that know then, be it really some of no you the so cells the you the like why but a cells, mentioned in of we explain fuel the terms better whole emissions, know tech generators fuel terms like strategy in Thomas, are behind shouldn't the KARNO I the seems use I for KARNO

generator? of the KARNO to versus trying just advantages fuel understand the So cell

Thomas Healy

Sure.

brings the fuel it’s a tailpipe. only the So, nail you it's the agnostic. head, that hit this on cell on on It fuel opportunity runs hydrogen forward KARNO side, zero versus

a is it can than run tailpipe natural So the it better significantly but would on emissions, of can very, do still a to you we're of NOx gas, it. engine do going that tailpipe on on coming run are hydrogen. be it very have Similarly, have gas, on significantly, combustion you you emissions also When hydrogen, seeing but that running natural have out they internal are producing. emissions, micro amount a

fuel going that a efficiencies, is So, KARNO we efficiencies in better than to terms expect actually cell. forward though, the of pull

think that the on customer fuel a they're presenting do interest has base cell. the customers will we Hyzon fuel with And going we're are stations see work that and and to is Hyzon we where will areas expect see working we have going of I what adoption. these the built So, some are cell seeing some already out, going to already likely for solution.

we of is use between have fleets, could more various be, proof, kind solution for that gas, a can the we chosen then, over trucking, the the right? is KARNO what those could going fuels But hydrogen, look to natural use by long they could as road it a at also haul because go generator think problem. that's you really future it for without You and of

it pretty on technology we’re still in So, bullish that is but that's KARNO has, opportunities the a development.

well. as that's we why so, cell the are fuel including And

just to One highlight other is thing certification. around the

So, to of -- the government pulled the even into time been, long kind one ERX, has we're for that are are there, out mandates we're going and a be portfolio with we probably fuel of are questions and the all ACT, IRA, across to pulled those ACF, going of product the be our ERX, three seeing the in. that of cell, KARNO all the

there just discussion that's highlight draft there's to lot in around by ACF, is thing one mandate a of the And been which CARB. recently format is

they're and saying ACF. looking to is don't been on that actually CARB to have what pushing on ACF proposing. on that from exemptions Fleets color they So, later little back vehicles for CARB adopt need

call that a not be performance having they if good it vehicle and a and for vehicles that expressed emission vehicle they fleets is for has adopting, characteristics an correct they're that that should is -- going things reiterated not grant available recently exciting exemption. saying a CARB the good is near-zero available, where CARB infrastructure the get doing to so get they're not us is of and not being emission near-zero going enough that One because is extensions to able had to

vehicle vehicles long-term credit. us. and obviously, those during still us for kind of into available. if we're one will and of that forced So, same a vehicle, Because a near-zero And adopting adopt isn't time that's one even huge fleets the now could or BEV a be they get emission

a you. for touch So there, points on I wanted to longwinded of couple answer but

Operator

Thomas over further no the are remarks. you at questions final this time. call back there I And some Mr. closing to turn Healy, for

Thomas Healy

a -- excited of Terrific. And demo call that today. with the everyone to today A Hyzon. the we Expo is everyone around showcasing be the We're as in June the the attend our about as as please either at with headquarters ACT exciting going appreciate please interested investor Well, join on lot XXth. us encourage the joining happening that's you're vehicle interested KARNO. we well Or happening for which news. will We're announcement to our ERX early to May. in well, if conference lot be

what showcase meeting. we're We expect to during be of able lot that really investor a live doing to

So, appreciate again look everyone taking next the time quarter. and we to forward chatting

Operator

Thank today's call. conference your you concludes This participation. for

disconnect. may You now

Hyliion (HYLN) 1 Mar 232022 Q4 Earnings call transcript