Good morning, and welcome to Nikola Corporation First Quarter 2023 Earnings and Business Update Call. Currently, all participants are in a listen-only mode. We'll begin today's call with a short video presentation, followed by management's prepared remarks. A brief question-and-answer session will follow the formal prepared remarks. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is my pleasure to introduce Dhillon Sandhu from Investor Relations. Thank you, operator. Good morning, everyone. Welcome to Nikola Corporation's First Quarter 2023 Earnings and Business Update Call. Joining me today are Michael Lohscheller, Chief Executive Officer, Stasy Pasterick, Chief Financial Officer, and Carey Mendes, President of Energy. A press release detailing our financial and business results was distributed earlier this morning. The release can be found on the investor relations section of our website, along with presentation slides accompanying today's call. Today's discussions include references to non-GAAP measures. These measures are reconciled to the most comparable U.S. GAAP measures and can be found at the end of the Q1 earnings press release we issued today. Today's discussions also include forward-looking statements about our future expectations and plans. Actual results may differ materially from those stated, and some factors that could cause actual results to differ are also explained at the end of today's earnings press release and on page two of our earnings call deck, and also in our filings with the SEC. Forward-looking statements speak only as of the date on which they are made. You are cautioned not to put undue reliance on forward-looking statements. After the video presentation, Michael and Stasy will give their prepared remarks, followed by analyst Q&A. We will conclude with questions from our shareholders. Please begin the video presentation. Thank you. Today in Southern California, we had a wonderful start for the ACT Expo. Nikola kicked it off. Good morning, everybody. I had the opportunity to give the first keynote speech this morning. We also then had the opportunity to show the Governor of California our fuel cell truck. California has an enormous impact on the U.S., but also on the world. People at Nikola share the common vision: pioneering solutions for a zero-emission world. In a time of uncertainty and challenges, you have to focus on what you are really good at. We've got the right product at the right time. You're taking diesel trucks off the road, we've got a solution for that. We've got the fuel cell truck, we've got the mobile fueler, and we've got the supply. Man, this thing gets up to speed. It does. Nikola's business model depends on changing the world. This is not a side hustle for us. This is the business we're in. I think it's absolute focus on what the customer wants, and that's what we're delivering. Thank you, Dhillon, good morning, everyone. Again, welcome to our first quarter 2023 earnings call. During the call, we will update you on our truck programs and energy business, and of course, Stasy will cover our financials. Before hopping into this, I want to let you know one thing: Nikola is the real deal. We have real trucks that are being ordered, delivered, and operating in customer fleets now. We have world-class software and technology and elegant zero-emissions products decarbonizing the high-polluting commercial transportation market. We are building a real hydrogen business via our HYLA brand with solutions for the entire ecosystem: production, supply, and refueling. We recently signed a deal with Voltera for up to 50 refueling stations, are advancing progress with HYLA mobile fuelers, and are moving forward on the Phoenix Hydrogen Hub in Arizona. We are doing these things at a time when governments are offering incentives for transitioning to zero emissions now and introducing regulations requiring the transition in the near future. We think we are the best-positioned company to spearhead the zero-emission transition and accelerate the hydrogen economy with our trucks consuming our hydrogen fuel on the highway. With that in mind, let's get started. The last few years at Nikola, we have been laying a foundation. This foundation allowed us to gain many skills, great technology, great products, great people, and a bit of humility as we hit some speed bumps along the way. The strong spirit of the company remained constant. With this foundation and spirit comes one thing: focus. Focus on our mission to pioneer solutions for a zero-emissions world. Let me lay it out very plainly. The future of Nikola is hydrogen. Hydrogen with our HYLA Energy brand, together with our Class 8 hydrogen fuel cell truck. And for more efficiency, integrated autonomous technology, software, and vehicle controls in our purpose-built trucks. Our market, North America. That's it. With that focus comes important decisions. Part of the plan for the new and refocused Nikola is to be geographically focused on the North American market. The United States is a leader in the energy transition with revolutionary federal incentives such as the Inflation Reduction Act, and many states like California, New Jersey, and New York offering both truck and fueling incentives. California is also mandating zero-emissions vehicles through the Advanced Clean Fleets rule, establishing targets for drayage fleets, government fleets, and fleets over 50 vehicles. Beginning January 1st, 2024, only zero-emission drayage trucks may register in the CARB online system. All drayage trucks entering seaports and intermodal rail yards would be required to be zero emissions by 2035. As part of this transition, we are selling our stake in the European joint venture to Iveco. This will reduce Nikola's cash spend and capital commitment and allow us to dedicate our resources to the task at hand in North America. Iveco is and will remain an important partner and key supplier for Nikola. Iveco will also maintain a substantial stake in Nikola and continue to cheer for us in our long-term success. We are grateful for the partnership and expertise we have gained and look forward to continuing our work with them. As we get our fuel cell truck ready for production, we are pausing production of our battery electric truck. The battery electric truck is a great product, and its development has allowed us to create many of the critical components and software systems that we can apply to the hydrogen fuel cell truck. We have sufficient inventory of battery electric trucks for our customers, and when production resumes this July, the battery electric will be built to order at our facility in Coolidge, Arizona, to better align with our capital allocation plans and improve working capital. I am confident to say we have best-in-class products and no other company can do what we have set out to do. This direction is exciting for all of us. We are creating an ecosystem that will allow Nikola's customers to own a hydrogen fuel cell zero-emission truck, and with HYLA, fuel that truck with readily available hydrogen. It has already started. The U.S. and Canada have put themselves on the forefront of hydrogen production, and the countries and states or provinces have created incentives to make it possible to dedicate all of our efforts to capture a sizable share of the commercial trucking market, as well as a quickly growing hydrogen infrastructure business. The upside potential on both businesses is virtually unlimited. We are well on our way to making it happen. Nikola fuel cell trucks are in heavy testing, along with HYLA hydrogen mobile fuelers, all of which will be available to customers later this year. Autonomous technology with our Plus AI partner is being tested today on the battery electric truck and will be available next year, with availability on the fuel cell following shortly afterward. It is truly amazing to see what this technology does to the trucking experience, improving safety, easing stress for the driver, and adding even more energy efficiency to each trip. We have made changes to our business as well. We have a new CFO, a revised sales organization, a more focused board, and have transitioned out or promoted the right people to the right positions. We have new partnerships and have continued progress with our previously announced partners. On the energy side especially, recently announcing our joint development with Voltera to create the largest North American open network of commercial hydrogen refueling stations. We have a stronger sales, commercial, and service network with new dealerships and salespeople eager to sell our trucks and energy solutions. Our employees and team members, including everyone listening in on this call, are our focus. We are all in making this happen together. What does this mean? The future looks bright if we do as we say, build and sell trucks, continue constructing the HYLA business, and drive costs down. There is no doubt we can be successful. Beginning with our energy business, on May second, we announced the execution of definite documentation with Voltera Power, a subsidiary of EQT, one of the largest clean infrastructure funds, to develop the refueling infrastructure required to support Nikola's hydrogen fuel cell electric vehicles. We plan to develop up to 50 stations with Voltera throughout North America over the next five years. Voltera intends to supply the capital for the station cost as well as operating the stations. Nikola will provide the hydrogen fuel and the technical expertise for the station construction. The stations are expected to provide both hydrogen refueling and electric charging for Class 8 trucks. We have made significant progress on the Phoenix Hydrogen Hub, recently receiving unanimous approval from the City of Buckeye on our general plan amendment and rezoning application, continue to progress on ordering long lead time equipment. In addition to the progress made on the Phoenix Hydrogen Hub, we continue to work on completing phase two of the Department of Energy Loan Program Office application process and work closely with Fortescue Future Industries on the co-development of large-scale U.S. green hydrogen production facilities across North America. We believe these two strategic partnerships, along with the many others announced over the last several months, further validate our business strategy to be capital efficient and prove the demand for financial partners in the build-out of our hydrogen refueling ecosystem. The most critical component for early adoption, we believe, are flexible fueling solutions. We believe mobile fueling will be an important part of our business moving forward as we look to provide customers with refueling, while at the same time remaining capital efficient and matching fuel cell truck network fueling demands. We are pleased to announce to date we have commissioned four HYLA hydrogen mobile fuelers. During the quarter, we announced our partnership with Chart Industries, which includes collaboration for the development of new mobile fuelers and modular hydrogen refueling stations. We have also signed agreements for additional mobile fuelers from other third-party partners, including Taylor- Wharton. Mobile fueling solutions can be rapidly deployed in any geography and with lower capital requirements than permanent station infrastructure. Mobile fuelers and modular stations allow us to match the hydrogen fueling requirements in geographies as trucks are introduced into the area. In our hydrogen fuel cell program, we remain on track to deliver trucks to customers later this year. We are currently building 10 Gamma trucks. Gamma trucks will be used for customer pilot testing and to finalize vehicle validation. As of today, we have completed the first two trucks and are in the process of finishing the next four trucks. The remaining four will be built and commissioned by the end of June. Pilot fleets include Biagi, Walmart, Linde, and AJR Trucking, a leading carrier for the United States Postal Service, who recently announced an order for 50 trucks. The first production units are anticipated to be built in July. We believe Nikola will be the only company with a production Class 8 hydrogen fuel cell truck available for purchase this year. Our dealers have already received more than 100 orders for the fuel cell truck from end customers. Our commercial team is working diligently to secure additional orders and fill our remaining backlog for 2023 and 2024. The hydrogen fuel cell truck and our energy business will be long-term value creation opportunities for Nikola. We believe we are the best-positioned company to take advantage of the massive incentives provided by state and federal governments and can take a significant market share as a first mover in the Class 8 zero emissions vehicle market. We are also beginning to build sales momentum with the battery electric program. During the first quarter, we produced 63 battery electric trucks, delivering 31 to dealers. In the quarter, we achieved 33 retail sales, a significant increase from 2022. Our revamped commercial and sales organizations and strengthened dealer network have improved the go-to-market strategy. We believe we will continue to improve end customer delivery numbers. This will be made possible through new financing options and providing customers with fully integrated mobility solutions. We believe these positive changes will continue to compound and build momentum as we look to reduce inventory and move trucks into customer hands. We will continue to provide these battery-electric trucks to customers on a build-to-order basis. In Coolidge, we continued with progress on the phase two assembly expansion hall, which will be complete by the end of Q2. At the end of May, we will temporarily pause production in Coolidge as we convert the assembly line to accommodate both the battery-electric and hydrogen fuel cell trucks. We will resume production in July as we begin fuel cell production. We also plan to begin battery module and pack manufacturing in Coolidge by July 2023, and will begin Bosch fuel cell power module assembly in Coolidge by December 2023. I will now pass it on to our new CFO, Stasy. I am happy to have Stasy join me on the leadership team. She has great knowledge of our business and her passion for the company is evident in her work. She is off to a flying start and will be a great partner with me and the rest of the leadership team. Thank you, Michael. Good morning, everyone. I would like to begin by saying I'm thrilled to be Nikola's new CFO and I am thankful for your support. In my last four years with Nikola, I had the opportunity to develop a deep understanding of the company's operations and financials. By joining the leadership team alongside Michael and our board, I am excited to be in a position to make a positive impact on the strategy of our business with a greater focus on financial discipline. I believe Nikola is the leader in Class 8 zero-emission transportation and hydrogen economy, and can capitalize on the virtually unlimited opportunities in the marketplace. To get that opportunity, we need to navigate a highly challenging macro environment, make the right business decisions, and unlock the long-term value of our business and the positive impact Nikola can have on the world. My number one goal is to align our spend with our strategic priorities, focusing on fuel cell, hydrogen, and the North American market. It is critical that we optimize our cost structure, slower cash burn, and achieve positive EBITDA by 2025. Let's review our Q1 results. During the first quarter, we delivered 31 trucks to dealers and recognized total revenues of $11.1 million. Cost of revenues for the quarter was $44 million, generating a gross loss of approximately $32.9 million or -296% versus nearly -700% in Q4. This is a substantial improvement attributable to higher delivery volumes, lower inventory costs, specifically related to transitioning out of Cypress, improved inbound freight costs as we manage inventory receipts while we pivot our manufacturing strategy for battery electric to build to order, and improvements in plant and labor overhead cost structure. R&D expenses came in below our Q1 guidance and below Q4 levels at $64.4 million, including $9.1 million in stock-based compensation. SG&A expenses came in at the midpoint of our guidance and significantly below Q4 levels, totaling $53.7 million, including $14.7 million of stock-based compensation. With the new executive compensation plan and cancellation of remaining market-based RSU awards, we expect the stock compensation run rate to be substantially lower moving forward at roughly $16 million per quarter in the second half of 2023. GAAP net loss for the first quarter totaled $169.1 million. On a non-GAAP basis, totaled $143.6 million. GAAP net loss per share was $0.31 basic and diluted. On non-GAAP basis was $0.26 basic and diluted. Turning to the balance sheet, we ended the quarter with approximately $206.3 million in cash, including $85.2 million of restricted cash. Not included in our Q1 cash balance is $96.5 million of net proceeds we received from the follow-on and direct offerings, which closed in April. Our current access to capital is approximately $796 million and is comprised of $206.3 million of cash on the balance sheet, including restricted cash, $243 million available on Tumim ELOCs, $200 million available on ATM, $50 million available of convertible debt, $96.5 million of net proceeds received in April from the follow-on offering. We want to be clear, much of this capital availability is dependent upon additional shares being authorized by our stockholders in June, and registering those shares per the applicable agreements, along with certain other contractual limitations and market conditions, including stock price. In addition to facilities we already have in place, we're vigilantly monitoring opportunities to raise capital, including monetizing the existing assets on our balance sheet. At the end of the quarter, accounts receivable balance was approximately $27.6 million, down by approximately $4 million from Q4 despite higher sales volume. Through April, we have been able to secure $20 million in floor plan facilities, resulting in AR collections of $15.4 million. They're working hard to substantially improve our financing options, both on the dealer and retail side, to enable sales and faster cash conversion. At the end of Q1, we held approximately $123.6 million in inventory, flat versus Q4 levels. This includes $80 million of finished and WIP inventory, including 152 battery electric trucks in Coolidge. Now that we have sufficient stocked inventory, we are adjusting our manufacturing strategy from build to stock to build to order to improve cash burn and optimize working capital requirements by minimizing raw materials. CapEx for the first quarter totaled approximately $52.3 million and was predominantly spent on Coolidge manufacturing facility expansion, which is now substantially complete, supplier part tooling for the fuel cell truck, hydrogen production equipment, hydrogen mobile fuelers, and the fuel cell power module production line. As Michael said earlier, we are exiting the JV with Iveco in Europe, allowing us to exclusively focus on our most important market, North America. In exchange for our 50% stake in the JV, Iveco will pay Nikola $35 million cash and deliver 20 million shares of our common stock back to Nikola. By shifting our focus to the North American market, we expect to realize near-term benefit consisting of savings from European development spend, future JV contribution commitments, return of investment from Iveco, and being able to utilize the 20 million shares for additional capital raise activities. We see improved sales momentum from our new commercial team and remain focused on hitting our delivery numbers this year. The product mix may shift from battery electric to hydrogen fuel cell as we see strong demand for that technology. For full year 2023 guidance, it is too early in the year to update as we are working through cost center alignment and prioritization. At this time, full year 2023 guide remains unchanged from the last call. We do have a line of sight to reduce CapEx by at least $20 million by optimizing our manufacturing footprint and being capital efficient on our energy infrastructure. We are also taking a critical look into our OpEx, and we'll provide an update on our Q2 call in August. In Q2, we expect to deliver 30-60 battery electric trucks for revenues of $10.5 -$21 million and generate gross margins of -240%- 130%. We expect gross margins to continue to improve as we scale our volume throughout the year. Once production commences, we expect the gross margin on the hydrogen fuel cell truck to be substantially and immediately superior to the battery electric due to higher ASP and lower bill of material costs. Our goal is to reach gross margin break-even point by the end of 2024. Our estimated R&D for Q2 is in the range of $75 -$80 million, including $8 million in stock compensation. 2023 R&D expenses are front-loaded due to the Beta fuel cell built in Q1, Gamma fuel cell built in Q2, and fuel cell validation activities ahead of launch. We expect our R&D run rate to drop by approximately 30% in the second half of the year. SG&A will be in the range of $60 -$65 million, including $20 million in stock-based compensation expenses. Stock compensation will be higher in Q2 due to the cancellation of the remaining market-based stock awards for executives of $7.2 million and impact of executive retirement of $3.3 million. We anticipate Q2 CapEx to be $45 million, primarily focused on modification of the production line in Coolidge to accommodate the hydrogen fuel cell truck, the fuel cell power module assembly line, and fuel cell supplier part tooling. Going forward, we expect our CapEx spending to reduce significantly as we will have the footprint and capacity to build trucks with minimal additional investment. In Q2, we expect the weighted average shares outstanding for the quarter to be approximately 687 million and the total shares outstanding to be approximately 698.5 million. Our redefined focus at Nikola will allow us a much lower cash burn as we realign our cost structure. In 2022, our cash burn was approximately $200 million per quarter and $240 million in Q1 of 2023. Q1 cash burn was inflated by almost $40 million of costs related to Cypress operations and severance. This level of cash burn is not sustainable for our business. We are looking at every option for reductions in spending. We are already beginning to see some progress with April cash burn coming in at $46 million. I am personally driving renewed focus on aggressive management of all three pillars of working capital: cost reductions, specifically payables, inventory procurement and management, and of course cash collection. We already have a line of sight to achieve approximately $150 million cash burn per quarter, and are working intently to reduce quarterly cash burn further with targets of $120 million by the end of 2023 and $100 million in 2024. This will take focus to find further opportunities to improve our cash position and show tangible progress towards reaching profitability. Now I will pass it back to Michael for closing remarks. Thank you, Stasy. Let me summarize our priorities and how this focus will make Nikola better. We will focus on our hydrogen refueling business and the fuel cell truck in North America. This is where we have clear competitive advantages. We are the first in the market with our hydrogen fuel cell truck and have a leading role with our energy infrastructure. We will change our model to build to order for the battery electric truck and focus on autonomous technologies which help drivers and fleets. We expect this focus will reduce our cash burn and in turn help Nikola achieve profitability sooner. By focusing on our strengths, we will continue to increase our sales momentum in both hydrogen fuel cell and battery electric trucks and capture a meaningful share of the market. This concludes our prepared remarks. Operator, please open the line for analyst questions. Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question is from Jeff Kauffman with Vertical Research Partners. Please proceed. Thank you very much, and thank you for that very detailed rundown. Stasy, first of all, congratulations on your promotion, and best of luck to you. I just wanted to follow up on your comment on a line of sight to $150 million cash burn per quarter, $125 million at the end of the year. Could you give us a better feel for what types of programs you have visibility on? You know, kind of is it mostly second half where we're going to see some of these adjustments? Or is it going to be more of a constant re-engineering throughout this year and the beginning of next year? Thanks, Jeff, and thank you. I appreciate the kind words. It's good to be here. I'm excited. Obviously, we have a lot of work to do. Jumping in, talking about the cash burn, as I mentioned, we already have made some progress coming in at $45 million in April. That's, you know, comparatively, if you look at our monthly average in Q1, which was $75 million, we're doing much better. Still, again, a lot of work to do to get to below $100 million, which is my ultimate goal here. To get there, it will be really a combination of things. We need to improve truck economics for one, reduce OpEx, limit CapEx, which we've mentioned briefly in the call, and of course, manage working capital, and that will be critical as we ramp up our fuel cells. A lot of that will come in in second half of 2023. Once we get into fuel cell production, really roughly half of our cash burn will be attributable to working capital. If we can manage that more effectively by managing our inventory, switching to build to order, making sure we have financing available, then we can drastically improve it. Okay, thank you. Then just one follow-up, and this is more for the energy business. With the announcements that have been made, moving with the mobile fuelers and the partnership with Voltera, how does this change the economics of the energy business? Should we just think of the Voltera deal as Nikola not having to put out the money for capital for these stations? In terms of the energy model, how do these recent announcements change anything or do they at all? Jeff, it's Carey Mendes here, President of the Energy Division. Great question. I think, you know, we have a very detailed economic model when we look at the energy business and are negotiating with our partners. The Voltera deal, actually, you're absolutely right, relieves a significant capital burden for us building these stations. Partnering with them actually enables us to get a first-mover advantage in this whole ecosystem, right? Building the stations, having the mobile fuelers. As an energy person with a lot of experience in this, you know, getting a first-mover advantage on infrastructure gives you a leg up on the competition, plain and simple. Voltera has been a great partner on that. The economics of how we model this don't change. You know, what we've negotiated with them is a fair competitive rate. They understand that we are first movers and are partnering with us. I'd say, you know, as we go forward, you know, looking at our models, this relieves the capital burden and the economics don't change. Okay. Well, congratulations, and thank you very much. Our next question is from Bill Peterson with JP Morgan Chase & Co.. Please proceed. Hi. Thanks for taking my questions. Nice seeing you last week, Michael. At ACTX, you're showing both your trucks and presumably having a lot of conversations with fleets. Then you announced that, you know, Advanced Clean Fleets, you mentioned that there's more sticks coming, especially in California. I guess my question is, where are most of your discussions focused on coming out of that conference? Are people really gravitating more towards the fuel cell or batteries? I'm particularly talking about maybe newer fleets that you don't have current arrangements with. Yeah. Thanks, Bill, for your question. First of all, I mean, ACT Expo was a very big show last week. I mean, I was really overwhelmed. I think there were 11,000 people, and we had a very good opportunity to discuss all kinds of business topics with our customers. I see a couple of very important trends. First of all, I mean, zero-emission mobility is coming, right? The stakes out of California are so obvious. The level of interest was much, much higher than the year before. In terms of battery-electric truck and fuel cell truck, we see still both very relevant for our customers, but it depends on the applications, right? Like the ports in California, they prefer a battery electric truck, and we are happy to continue to produce the battery electric truck, right, while we pause now production, but we are happy to build this truck going forward. At the same time, I will say, and that's why I think Nikola is uniquely positioned, there is a very strong interest in the fuel cell truck, right? The range of 500 miles is very competitive. It's best in class. Who else is out there in terms of a fuel cell truck now? I mean, we produce the fuel cell truck now in July. My takeaway from ACT Expo was, yes, there is interest in the battery electric truck, especially for ports, but overall, the topic is really hydrogen. What Carey just mentioned on the infrastructure, that is where most customers will go. I mean, I think you see it in the numbers. I mean, we have 140 firm orders from customers to our dealers, and we're very positively surprised about that because it shows, and actually, this number is going up kind of on a daily basis. I mean, I got the next order this morning. It shows that people want to have this truck now and don't wait. I think we see a clear trend in terms of fuel cell and hydrogen. Okay. Thanks for that. My second question is for Stasy. You know, you've been in the role here for some period of time. I guess, how do you think about the options you have looking ahead for raising capital, any particular preferences? I think you mentioned that there may be some options, you know, things you could use, I don't know, on the balance sheet. If you could just maybe elaborate on that and, you know, what options do you have from here. And by the way, it's nice to see the cash burn come down, but just what options do you have going forward? Yeah. Thank you, Bill. Great question. Obviously, capital raise is very high on the priority list here, along with limiting the cash burn for me. We all know market conditions are very tough right now, but we remain positive, and we have demonstrated ability to raise capital. In Q1, we raised $120 million through the existing instruments, and also we went out right after the quarter end and raised additional $100 million through the follow-on offering. Obviously, again, in a difficult market, not a lot of companies are able to pull that off. We're remaining cautiously optimistic. As far as the remaining access to capital on existing facilities we've covered is about $500 million. As you mentioned, we're also exploring other opportunities to raise money, including monetizing the assets that we have. If you look at our balance sheet, we have a lot on our balance sheet in terms of PP&E, land, buildings, things of that nature, as well as IP. We're working on that in parallel to make sure we always have options available, and we'll continue to access capital as needed while cutting costs. Thank you. Our next question is from Dillon Cumming with Morgan Stanley. Please proceed. Hey, good morning. Thanks for the question. wanted to go back to one of the ones that was asked earlier in terms of just, you know, I guess it ties into the cash perm. Stasy, you made a comment in terms of still being confident or still targeting a positive EBITDA or breakeven EBITDA outcome by 2025. As you're going through the cost structure, right, I think this ties into some of the comments you made on the cash perm, but what level of truck production and/or deliveries, I guess, would support that outcome at this point relative to some of your cost reduction actions? Yeah. Thank you for your question. The way we think about it, one, you know, now that we realigned things, on everything that was talked about, we have a better path to get there to be profitable on an EBITDA level by 2025. Step one is we need to make money on the truck. And to do that, we need to reduce our BOM costs, and primarily on the fuel cells, where we have a lot more opportunity to reduce costs because a lot less of the BOM on a fuel cell is coming from battery pack and battery cells, and increase our sales volume. While we haven't given guidance for 2024, we expect in 2024, we at least need to be able to sell from anywhere from 1,000-1,500 trucks, depending on the mix, to breakeven. That volume would need to close to double in 2025 for us to be able to cover our current level of cash OpEx. Again, I will mention that we're working on our cash OpEx. This will come down as well, but that's currently where we are. Okay. Sorry, go ahead. No, the only other- Yeah. The only other thing I wanted to mention, obviously on the fuel cell, we have a lot of opportunity with our pricing. It's not just the reducing the BOM, where we have a very specific BOM reductions that we're working on, but also the pricing. Given what Michael talked about, we're gonna be first to market, so we have a little bit more pricing power there, and we'll be able to get better margin on the fuel cell. Okay, great. Yeah, that's super helpful. Thank you. If I could just ask a question on the Iveco partnership as well. Can you just flesh out, I guess, what the end game looks like in terms of that collaboration with them? I think, you know, you still mentioned in the press release you're planning to license the S-Way kind of framework and technology from them going forward. You know, does, I guess, the dissolution of the JV open the door to potentially test out new kind of platforms for your hydrogen fuel cell product? I think I'm asking in the context of The market's solving some concerns about whether or not a cab-over truck is the right model for the U.S. or not. Just be curious on your thoughts there. Yeah. Thank, thanks, Dillon. Let me take that, Michael here. First of all, the partnership with Iveco will obviously continue. I mean, Iveco will stay shareholder of Nikola in a meaningful way. We, from the Nikola side, will continue to have a supply agreement with Iveco, so the cab and also the eAxle. So in a way, the partnership continues, but in a more focused way. Why does this make so much sense for both partners? I mean, it's much better that Iveco does the business in Europe, and we focus here on North America. With all the positive momentum we have on the fuel cell truck, I also need my engineers here focusing on the fuel cell truck. It will actually help both companies to implement much faster. Let me tell you, in terms of operational experience, sometimes it's not a good idea to have, like, engineers on the other side of the world with 9-hour time difference. Implementation will be much faster. In terms of your cab over, great point, and also there at ACT Expo was a very good feedback for me. There are many people who love the cab over, in particular, once they are in the truck. Is it an unusual cab over? Yes, absolutely. Not everybody loves it. Once people are in there, people are actually delighted. They see also our infotainment. I'm very, very positive about the cab over. Yeah, you will find one or two customers and they say, "Look, we don't like it," and that's okay. Got it. Very helpful. Thanks, guys. Our next question is from Michael Shlisky with D.A. Davidson. Please proceed. Good morning, thanks for taking my question. Michael, it was great to meet you last week at Expo as well. I wanna ask about the HYLA mobile fueler business. I guess the Voltera deal, they'll be paying for the stations out of Voltera's bank account. The mobile fuelers, are you paying for those for the customers to use as either a bridge or an area where there's no stations being developed? As I kinda walked the show, you know, a lot of tanks. Prices are coming down, but it's still, you know, a few million dollars, it seems per like unit. I'm curious who's gonna be, you know, paying for each of those HYLA fuelers there? Yeah. Thanks, Mike. It's Carey Mendes again, and good question. Again, I think this is one area where Nikola is leading the ecosystem here with these mobile fuelers. The first one that came out in December, we developed on our own, 700 bar pressure, which enables a faster refueling time. We've got three more now that we've developed, so four of our own. We've got another 16 or so coming for the rest of this year and then more next year, and those are from third-party suppliers, some of which we've mentioned in the press release, and Michael talked about Chart Industries being one, Taylor- Wharton being another. These will be liquid mobile fuelers. We've got good terms with each one of those suppliers in terms of being able to lease those from them. Look, the value in these partnerships is they're keen to see greater use of these mobile fuelers, so they're being really good partners, and I think we've got good terms with each of them. I think the next question then as this business scales up, it is a really profitable business, I think, to have these mobile fuelers because stations take a couple years to build. These mobile fuelers come on stream a lot faster. We are also looking at, okay, what's the partnership model for those? I think especially since the Inflation Reduction Act, you've seen the Voltera announcement and others, there's a lot of people with solid balance sheets, capital, looking to get into this space, take advantage of the various incentives and the fact that we're bringing demand to the market, first off, in hydrogen. I'm confident that with partners like Chart, Taylor- Wharton, as well as others that are looking to get into the space, we'll have similar solutions for spreading the capital cost and the risk. Just to clarify, the customer is not gonna be paying. The person who's driving the vehicle, that the end user is not paying for the mobile fueler at their location? Yeah, no, good clarification question. At the end of the day, the mobile fueler is a cost as part of dispensing hydrogen, so we will be building it into our economics just like a station. A mobile fueler is a temporary station in a way. The customer ultimately, the sales price we have will reflect that. Okay. Outstanding. I wanted to clarify the plan for the Tre BEV going forward. You mentioned you'll be doing this on a build-to-order basis. I guess I'm not sure what that means. Will you no longer have dealer inventories once the current ones are depleted? Will you have to kinda shut down production entirely at Coolidge once you change over to the fuel cell to kinda make any small orders? Will you have enough volumes to keep at least one line running with the Tre BEV? I'm just kinda curious how many Tre BEVs are in the mix going forward and how that might affect your production process. Thanks for bringing this up, Michael. Happy to clarify this. I mean, first of all, we paused battery electric production at the end of May. Why do we do that? Because we launched the fuel cell truck in July. With all the experience we have, it's important that the factory line has time for training, preparation, and that's exactly what we do. At the same time, we have inventory available on our side, to be precise, 152 trucks, so that is inventory now we want to obviously move to our dealers and then to end customers. We will pause the battery electric production, and then once we see then orders coming through, we will resume battery electric production. I think it's also fair to say the level of inventory is a little higher than we would like to have it. I mean, we basically have two advantage out of this production pause. We will continue to produce the battery electric truck once we have the order level. Just to like, just to clarify, if someone orders two trucks, two batteries of trucks, let's say next year, do you have to shut everything down just to make those two trucks? Will they be just inserted into the line of the fuel cell trucks? How will it happen once you're out of inventory and you have to build some more, you know, a few at a time? Yeah. No, great point, but it's very clear. We have the capabilities to produce both trucks on our line. Battery electric truck and fuel cell truck can be produced on exactly the same manufacturing line. That is actually also what we set up. Whatever the customer then wants to have, let's say, at the end of this year or next year, we will be able to produce, but we will do it on a order basis because obviously the working capital is high. We need to bring this down, optimize our cash burn, what we discussed. No, very clear, our production line can produce both trucks, the battery electric and the fuel cell truck. Super. I'll pass it along. Thanks so much for the commentary. Our next question is from Winnie Dong with Deutsche Bank. Please proceed. Hi. Thanks so much for taking the questions. First question is one of the Q1 results. Can you provide a bridge to the Q1 gross margin has improved quite a bit sequentially, but what are the drivers for the more negative margin versus the guidance expectation? If you can also reiterate sort of the bridge to the full-year gross margin guide as well in the near term. Thanks. Yes. Hi, Winnie. Nice to talk to you again. Good question on the margin. I think we've been very open that our margins obviously will only improve as the volumes improve, right? We have a high level of fixed costs, and we need to produce more trucks, plainly to be able to cover that cost. That's number one, and that's partly why we're a little bit below where we want it to be. Also Cypress operations have contributed pretty significantly to the negative margin in Q4 and Q1, and we've talked about that. As we're able to move our operations out of Cypress, and establish the manufacturing line in Coolidge, which is happening in July, we'll be able to limit a lot of the labor and overhead that comes into manufacturing it back at a separate facility. That's really the key here to get to the range of the gross margin that we have communicated for the rest of the year. Got it. Thank you so much. A follow-up question on the BEV, as, you know, the new strategy is now built to order. We did see quite a bit of improvement, you know, in terms of retail delivery from dealers to the end customers. Maybe can you talk to us about some observations that you've made in the end market? There seems like encouraging signs that, you know, end customers are taking retail delivery in the quarter. Thanks. Yeah. Thanks for bringing this up and happy to give some more color on this. I mean, first of all, you're totally right. I mean, we have seen now uptick on the retail side with 36 trucks being retailed in the quarter. Actually, that's much more than we retailed in the total year 2022. There is momentum building. Couple of things we have done. I mean, first of all, we had some important changes on the dealer side. We have really active, engaged dealers now, in particular in California. They do a good job. Also, frankly speaking, time is helping. The more people we bring into the truck, the more people like it, right? Experience, like coming back to the ACT Expo, we had 200 test drives, like, within three days. Those things are helping a lot. We see momentum on the sales side. Of course, I want to go faster, right? Because we have inventory available, and that's also a benefit. I mean, having inventory in these days is a great thing because if people then are interested in zero-emission mobility and have to wait 24 months, that is not a good thing. I think Nikola is probably the only one at the moment with inventory available. While we want to bring it down very quickly in terms of financial aspect, it's also a benefit, right? I think we see first good momentum and want to go much faster. Great. Thank you so much. I'll pass it on. As a reminder, just star one on your telephone keypad if you would like to ask a question. Our next question is from Tyler DiMatteo with BTIG. Please proceed. Hi, everyone. Thanks for taking the question. Michael, I wanted to follow up on the fuel cell vehicle. As you look to roll that out more towards the end of this year and the order book continues to grow, just at a higher level, how are you thinking about prioritizing those orders, presumably as your order book continues to increase while you're trying to bring all of these pieces in-house? Just any way to think about that, any more color there? Sure. Great point, Tyler. Happy to add some color. I mean, first of all, as we said in terms of the manufacturing line, we have total flexibility. Whatever customers really want, we will be able to produce it. What is very obvious, and it was confirmed last week when we were all in California, that there is a strong trend in terms of the fuel cell truck. Why is that? First of all, the range of the fuel cell truck is 500 miles. Which other zero-emission mobility truck can do 500 miles at the moment? I think we have a unique selling point. The fueling time is only 20 minutes. In an industry where it's all about uptime that you have to drive the truck, it's a very big benefit. What's also obvious with everything being decided now in California, a lot of people pay attention to that, and it's really pushing people into the zero-emission mobility. That's why we think the fuel cell truck has much more potential going forward, and that's why this focus is also important for us. North American market is very big. Fuel cell truck can play a big role there. Fair to say, we have a unique selling proposition because at the moment we're the only ones in the market starting production in July. So we feel very good about that. It's our second truck we launched, right? I think we have demonstrated with the battery electric truck that we can develop manufacturing and manage to have a world-class truck, and now we do it the second time. We came back last year with a lot of optimism in terms of the fuel cell truck. Again, people order it without really having driven it. I mean, a few customers have demo trucks, so we are cautiously optimistic on this side. Okay, great. Then I wanted to follow up on the financing piece. Clearly, you know, retail orders this quarter were pretty good. Just what are you hearing from customers on the financing piece? What are they telling you as you know, look to roll out more trucks on the BEV side and then really hit the ground running on the fuel cell side? What are you hearing in the market from customers? Clear feedback is, trend towards leasing, no question. People want to have like monthly rates. Then every customer is very similar, a very detailed comparison to TCO of diesel. What is the current level of TCO? What is the TCO then with our truck? We can actually match that in various states already today. I think this is great. I mean, you can get a zero-emission truck, so no emissions and can keep your diesel costs and we have the total cost of ownership. This is very, very strong. We can't do it in all states, that's also true. We need some support, some incentives. Clearly customers are focusing on the monthly rate, total cost. Okay, great. Thanks for the time, guys. I'll turn it back to the queue. Our next question is from Jeff Osborne with TD Cowen. Please proceed. Thanks for taking the questions. Just a couple on my end. I was curious if the recall on the BEV had any impact on your decision to, you know, narrow the focus. I applaud the decision, like the outcome, I'm just curious if the recall was a variable in your thinking there. Not at all. Thanks, Jeff, for bringing this up. I mean, this was a recall. We worked through this, had no impact on our decision whatsoever. Got it. Good to hear. Is there any, you know, one-time cash items for the remainder of this year or next? I was just trying to recall the details from the SEC settlement that you entered into some time ago. I think the payments were made over multiple installments over two years. Did you already reserve the cash for that, or have you already paid that, or is that something on the come? Hey, Jeff. Yes, we are looking at making very small incremental payments to the SEC to the tune of like $1.5 million. We're stretching that out. It's in our liabilities right now. Got it. Then is there any, you gave the gross margin, or cash burn, and the target of gross margin, I did know if you could provide more incremental details on the path to EBITDA positive? Yes. Again, I think it kind of goes back to two things, right? 1, we need to improve our margins on the fuel cell first next year and get to fuel cell breakeven. How we can do that, right? Right now on the fuel cell, we need to improve our BOM costs. We are gonna hit production at about $440K per truck material costs, and our target is to get to $275K per truck in 2025. We can do that by, one, bringing the fuel cell power module manufacturing in Coolidge, and also just having higher volume and getting better pricing power with suppliers. We already touched on the average selling price on the FCEV. We expect that to be better just being first to market. Got it. Thank you. That's all I had. Thank you. I will now hand the call back over to Dhillon for shareholder questions. Thank you, operator. The first question is: how many trucks have you sold so far, and how many orders from companies do you have? Through Q1, we have made 162 wholesale deliveries of the battery electric truck. Our improved sales and commercial team, in conjunction with our dealer network, have been improving retail sales as we work with them and customers through infrastructure challenges, add additional financing partners, and make product improvements. 33 retail sales were completed in Q1. We see good momentum building to increases. As we showed on the slide earlier, battery electric retail customers include TTSI, Univar Solutions, and Avant-Garde Auto Logistics is using our truck to deliver Nissan electric vehicles to dealers. On the hydrogen fuel cell truck, dealers have received orders from over seven end customer fleets for more than 100 hydrogen fuel cell trucks. We have announced previously orders from Biagi Bros, Plug Power, and recently AJR. The second question is: What plans are being made to advance hydrogen technologies that will bring Nikola to the top? Sure. Right now, we are on the verge of bringing the hydrogen fuel cell truck to market. We believe we will be the first company with a production hydrogen fuel cell electric vehicle available for purchase, and have a significant head start on the competition. In conjunction with the truck, we have made great progress on the energy side, recently announcing the joint station development agreement with Voltera and making good progress on the mobile fuelers. No other company is coming with both trucks and energy. No one else is doing this. In fact, our competitors may be coming to us for hydrogen fuel. We are excited about our hydrogen fuel cell truck and energy business. There is a massive potential. Thank you, Michael. Stasy, there are a few questions surrounding breakeven, profitability, and what production volume we would need to hit to achieve those metrics. Maybe we can go over those now. Sure. Thank you, Dhillon. Now that we have refocused our business model, we have a better path to achieve positive EBITDA by 2025. Before we talk about profitability, first, we need to be able to make money on the trucks we sell by reaching gross margin breakeven in 2024. This will come from several places. We have to reduce our BOM cost, specifically on fuel cell, where we have a lower material cost to begin with, as it only has two battery packs versus nine battery packs on the BEV. As you know, for BEV, the battery packs themselves make up over 50% of the BOM cost. For fuel cell, we currently anticipate hitting serial production at $440k per truck, and we will be driving that cost down to $375k by bringing FCPM manufacturing to Coolidge and achieving higher volume, with eventual goal of getting to $275,000 per truck by 2025. For BEV, we're currently at $396,000 BOM cost, with a line of sight to improve that to $340,000 once we sell through the current stock of finished trucks and batteries on hand. That improvement will come through battery pack cost reduction we have discussed previously, as well as picking up lower battery cell pricing in future material purchases, as lithium prices have come down significantly. While we are not giving guidance for 2024, we expect we will need to sell at least 1,000-1,500 trucks, depending on the mix to breakeven on our business at the gross margin level. That volume needs to close to double in 2025 for us to be able to cover our cash OpEx and get to positive EBITDA. Thank you all for listening to our first quarter earnings call and for your ongoing support. As we discussed, we are very focused and we'll continue executing our business plan. Wish you a wonderful day. Goodbye. See you soon. Thank you. This now concludes today's conference. You may disconnect your lines at this time and thank you for your participation.