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AYRO Is Putting the Peal to the Metal to Create a Niche in the EV Industry

22 Mar AYRO Is Putting the Peal to the Metal to Create a Niche in the EV Industry

Ayro, Inc. (NASDAQ: AYRO), a designer and manufacturer of emissions-free electric vehicles for last-mile delivery and community transport, announced an agreement with one of the world’s largest pure-play automotive fleet managers namely Element Fleet Management (ELEEF). Element currently runs operations in 5 countries and manages more than 1 million vehicles for over 5,500 loyal, world-class clients.

The partnership will leverage AYRO’s marketing, engineering, and production expertise with Element’s global footprint and consulting experience to enable the deployment of AYRO electric delivery vehicles over the next four years in the U.S and the Canadian Market. The deal encompasses access to Element’s suite of services spanning the entire vehicle lifecycle such as consulting, commercial sales team and service infrastructure.

Rod Keller, CEO of AYRO, Inc, commented,

“Our partnership with Element is intended to support large-volume deployments of our EVs that are purpose-built for the delivery market. Restaurants, food services, and delivery companies with national footprints need more than just EVs – they need financing, telematics, and maintenance and repair services to manage the entire fleet lifecycle and keep operating costs low. Together with Element, we should now be able to provide custom, end-to-end EV fleet management services for commercial customers, enabling us to quickly and effectively scale. We believe that Element’s market dominance and global footprint also give us a significant competitive advantage against other companies that do not have this support in meeting immediate demand for sustainable delivery fleets.”

The companies will initially target the U.S and Canadian market but will be open to meet the demands of global markets in the future, backed by the strength of their supply chain capabilities and other resources.

Ayro, Inc. (NASDAQ: AYRO)

Market Cap: $272.31M; Current Share Price: 6.91 USDChart
Data by YCharts

The International Energy Agency predicts that Electric Vehicles, which stand at 3 million today, will grow to 125 million by 2030. The Global Electric Vehicle market is all set to compete with the internal combustion engine (ICE) vehicles in the next five-year, accounting for one out of every five cars sold by 2030, according to Seth Goldstein, an analyst and chair of Morningstar’s electric vehicle committee. The growth of this industry is a result of the initiatives by governments around the world, in the form of tax rebates, grants, and subsidies for adoption of renewable and more environmentally friendly options for transportation. Unlike conventional vehicles which can only replenish their fuel at specific public locations, Electric vehicles can be charged at home or commercial charging stations.

However, the limitation of sufficient charging capacity to cover long distances discourages the use of these vehicles. There is an increased focus on research and development activities, especially in the passenger car sector, to improve infrastructure and supply equipment and establish EV chargers at easily accessible public places, to allow long distance travel as well. Range anxiety which acts as the biggest impediment for the market at present, will soon be a thing of the past, with Companies racing to develop connectivity modules.

The demand for electric vehicles will also bolster the demand for ancillary industries such as engine components, electronics for propulsion systems, battery optimization and torque transfer devices. In fact, the demand for lithium, which is a crucial component of energy storage in transportation batteries, is likely to quadruple over the next decade according to Seth Goldstein.

A report by McKinsey estimates that by 2025, there will be more than 350 EV models introduced into the market, with ranges of 200 miles. However, a lack of charging infrastructure could hamper the growth in the market. The report also highlights the fact that besides price and driving range, lack of access to charging stations is the third most serious barrier to EV. However there has been a gradual decline in prices and improvement in driving range and companies are making a concerted effort to provide the requisite charging infrastructure. Furthermore, the total energy demand for electric vehicles in China, the United States and European Union alone will reach 280 billion kilowatt-hours by 2030.

Image Source: Mckinsey

There has been an increasing interest in EV’s owing to environmental concerns, which has prompted leading automobile makers such as BMW, Daimler, Ford, and Volkswagen to announce an investment plan for deployment of 400 charging sites across Europe, in addition to investing approximately $90 billion in electric vehicles, according to a report by Reuters.

AYRO forte is purpose-built electric vehicles (EVs) that cater to the micro distribution and last mile delivery market. The Company’s offerings are customized to suit specific user requirements and enable a smooth transitioning to Electric Vehicles for the clients. AYRO’s EV’s not only reduce CO2 emissions and noise pollution by nearly 75 percent, but also cost almost 50 percent less to maintain, as compared to an internal combustion engine vehicle. The Vehicles are a perfect fit to the needs of educational campuses, hotels and resorts, government and corporate entities who are looking for vehicles that offer easy mobility, efficiency and reduced carbon footprint.

Image Source: Company

The Company’s Club Car- 411 is a compact all-electric vehicle suited for low-speed logistics and cargo services, and is targeted at campuses or urban environments that need agility and efficiency. The vehicle can be customized as there are multiple bed configurations to choose from such as truck, pickup bed, and flatbed. The vehicle comes with features such as Power-assist steering and 4-wheel hydraulic disc brakes, backup camera, cabin heat and ventilation, and an LCM display. In addition, the vehicle can also be turned into a part of a smart fleet through use of a GPS locator, alerts and geofencing.

AYRO-311 was first launched in 2018 as an all-electric 3-wheeled vehicle meant to serve the delivery and micro distribution market consisting of Restaurants, pharmacies, retailers, and other businesses. The Company is now working on the next generation of the vehicle by incorporating inputs from leading brands and its own research and experience. The vehicle named 311X is a customizable purpose-built, all-electric vehicle that has a longer driving range and improved features to serve the needs of commercial fleets. The vehicle is especially suited for the delivery requirements of packages, pharmaceuticals, groceries and restaurants.

Image Source: Company

The Company has developed an Electric Vaccine Vehicle (EVV) to meet the specific requirements of on-demand and mobile clinics engaged in COVID-19 virus testing and vaccine administration. The vehicle has features such as power to support medical-grade freezers and refrigerators, lighting systems and drop-down treatment tables that conform to CDC Vaccine Storage Requirements and are equipped with medical-grade equipment. The Vehicle can be used as a transportable vaccination center that can travel to different neighborhoods for easy administration.

Key Takeaways

  • AYRO’s agility to adapt to changing times is its biggest strength as evidenced by the Electric Vaccine Vehicle that fills the gap for a transportable vaccine vehicle adeptly. The Company is now focused on designing AYRO 511 4×4 Concept, an all-season, all-electric truck designed to drive any terrain or season. In addition, the Company is also working on the next-generation AYRO-311X, an upgrade to its first legacy model that serves the delivery and micro distribution market.
  • The global last mile delivery market in the U.S was valued at over US$9.5 Billion in the year 2020, according to a report by Furthermore the new U.S administration will invest close to $1.7 trillion over the next 10 years in its bid for a “Clean Energy revolution” that aims to establish US as the clean energy superpower and transform the energy sector by providing economic impetus. The Company is well-poised to capitalize on the opportunities that arise from an increasing number of people looking forward to sustainable and environment friendly transportation options.
  • The Company has signed a deal with Club Car, a division of Ingersoll Rand that develops golf cars and utility task vehicles, which provides AYRO access to its dealer network. AYRO has managed to leverage the partnership to gain entry into Princeton University and Penn State University as part of a test run. In August 2020, the Company also placed its vehicles in a military medical campus in the Northeast United States, and sees potential opportunity for follow-on orders.
  • The Company is likely to face increased competition in the future with more and more Companies jumping onto the electric vehicles’ bandwagon. The Electric Vehicles industry has seen an influx of players, from conventional internal-combustion-engine vehicles (ICEVs) vehicle manufacturers changing with the time and making a switch to Companies like Tesla that are revolutionizing the space with their forward thinking and innovation.
  • Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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