Ladies and gentlemen, greetings, and welcome to Workhorse Group's Second Quarter 2022 Investor Call. As a reminder, this conference call is being recorded. It is now my pleasure to introduce your host, Workhorse Group's Vice President of Corporate Development and Communications, Stan March. Sir, you may begin.

Thank you, Brock. Good morning, and welcome to all of you joining us on today's second quarter 2022 results call. Before we begin, I'd like to note that we've posted our results for the second quarter ending June 30, 2022, via press release. You can also find this release as well as an accompanying presentation in the Investor Relations section of our website. We've also filed our second quarter Form 10-Q this morning. We will be tracking with the posted presentation during the call today, so please follow along either from the link in the press release or through our website directly. And with that, let's get started. As you can see on Slide 2, joining me on today's call are Rick Dauch, our CEO; and Bob Ginnan, our CFO. We have a straightforward agenda found on Slide 3. Following my opening remarks, I'll hand it over to Rick, who will give you an update on the progress we've made on our strategic and financial priorities for the second quarter of this year. Bob will then walk us through our financial results for the quarter and cover our 2022 guidance. Then we'll take your questions. Moving to some other important items. Please note that in today's press release, we provided a note to specify what we mean when we use the term orders, which refers to a customer's contractual commitment to purchase, as well as defining what we mean by a slot reservation, which means a commitment to make a portion of our production capacity available and which is secured by a customer deposit. Our disclaimer can be found on Slide 4. As you know, some of the comments that we've made today are forward-looking, and therefore, are subject to certain provisions as well as risks and uncertainties. You can find the full disclaimer statement in our Form 10-Q and other periodic filings on file with the SEC as well as in today's press release. I'll now turn the call over to Rick Dauch. Rick?

Thanks, Stan, and good morning, everyone. Thanks for taking the time to join us today. My 1-year anniversary as Workhorse's CEO was just 1 week ago on August 2. And what an interesting and challenging 370 days it has been. On Slide 5, we have identified some of our major accomplishments as the new leadership team here at Workhorse. Over the past year, we have addressed several issues, while developing a 3-year business plan to transition from a technology start-up company into a full-fledged OEM, providing best-in-class commercial EVs. An organization's collective success starts with recruiting, hiring and retaining experienced professionals and capable staff. I identified the need to reshape the leadership team here at Workhorse shortly after I arrived. There is not one part of the organization which has not been strengthened over the past year. From reshaping my direct reports in the corporate staff, to building an operations team from scratch, to adding the necessary experience, talent and depth to our engineering and technical staffs, we have completely rebuilt the organization, and more importantly, the capability and skill sets of the Workhorse team. I will not belabor the point further, but will simply say this cohesive leadership group is now full of accountable driven and capable individuals who are fully aligned on our critical business initiatives. And as a team, we are just getting started on our journey together. We also undertook a number of critical actions in a timely fashion to strengthen the company in the near term such as grounding and recalling the C1000s, eliminate all of our debt and dropping the USPS lawsuit. While painful, these were absolutely the harder right decisions to make for our company. When I got to Workhorse, we were a one-trick pony from a production portfolio perspective. The only vehicle…

Thanks, Rick. Let's turn to Slide 14. Our results demonstrate the steady progress our team continues to make to strengthen our financial position and drive greater operating efficiencies, which will allow us to deliver enhanced value to our customers and shareholders. Sales, net of returns and allowances, for the second quarter of 2022 were recorded at $12,600 compared to $1.2 million in the same period last year. The decrease in net sales was primarily due to a decrease in volume of vehicle sales in connection with the previous recall of our C1000 vehicles. Cost of sales decreased $3 million from $14.8 million in the same period last year. The decrease in cost of sales was primarily due to a $6.7 million decrease in inventory write-downs and a $2 million decrease in costs due to a reduction in volume of vehicle sales. Additionally, the decrease in cost of sales was due to a reduction in costs associated with the initial production of the C Series vehicle platform. Selling, general and administrative, or SG&A, expenses increased to $13 million from $7 million in the same period last year. The increase was primarily driven by an increase of $4.8 million in employee compensation and labor-related expenses from increased headcount, noncash equity compensation and the appointments of our new executive leadership team. R&D expenses increased to $5 million from $2.1 million in the same period last year. The increase was primarily driven by an increase of $1.3 million in employee compensation and labor-related expenses due to increased headcount. Additionally, there was a $1.1 million increase in consulting and prototype expenses related to the continued development of our Horsefly, W56 and W750 vehicle programs. Net interest expense was $100,000 compared to $10.5 million, respectively. The decrease in net interest expense is primarily due to an…

Thanks, Bob. I want to briefly discuss our Q3 priorities on Slide 18. First, we need to continue adding depth and specific skills at the next staffing level -- layers in the company with an emphasis on the commercial and aftermarket and service teams. We need to keep executing on our product road maps and get production started at Union City. We need to get the Michigan and Ohio tech centers up to speed with their full testing capabilities by year-end. We plan to get our ERP planning processes kicked off with the transition to a new fully integrated system in 2023. Lastly, and most importantly, we need to get out on the road with our demo trucks, vans, cabs, chassis and drones and secure further customer orders. Before we turn the call over to Q&A, I want to reemphasize 4 important points from our call today on Slide 19. First, through the efforts of our team members, we have built internal engineering and test, supply chain and manufacturing capabilities as well as modernized all of our facilities, most notably Union City, providing a rock-solid foundation for future leadership in EV technologies, products and processes. We're building a company with a rock-solid foundation that's here to stay and win. We will continue to hire experienced, capable employees for critical positions and further strengthen our operational, supply chain and technical capabilities through hands-on and in-classroom training. We expect to hire more than 100 -- 150 hourly and salary associates in '23 and '24 to staff our production and testing sites. Second, our strategic product road map plan is on track and on budget, and we made important progress during the quarter with the initial production to start this month at both the CV and Aero sites. And third, we remain confident in the market opportunities ahead in our industry to deliver value to our customers, shareholders and other stakeholders. The transition to EV-powered commercial vehicles, including UASs, while still early in the game, is in process, and we expect to emerge as one of the winners. Finally, we have the needed access to cash and capital resources to execute our plans. That concludes our prepared remarks. Thank you all again for your time this morning. We look forward to continuing to update you on our progress. And we're now ready to open the call for our questions. Brock, please provide the appropriate instructions.

[Operator Instructions]. Our first question today is from Jeff Osborne of Cowen & Company.

Several questions from my end. I was wondering if we could get a crash course, Rick, on how to model both the contract manufacturing piece and the aerospace piece. I think most of Wall Street is not giving you credit for those 2 segments, and you sort of leaned into those in the prepared remarks. So it would be helpful to just go over how the puts and takes on modeling both revenue per unit as well as potential margin structure?

Yes. So Jeff, I'm going to defer that over to Bob. But let's say this. We're not going to go and do any business that we don't make money. I'll start with that as the CEO. How is that? So go ahead, Bob.

So Jeff, the -- I'll start with the contract manufacturing business. As Rick mentioned, up to a couple of thousand vehicles per year. Our component will be basically the labor to do that. So that will be somewhat minimal there, but we will have a positive margin that we expect in a -- who might see a normal operating margin there for contract manufacturing. So it should be something pretty normal and basic there. On the Aero side, as Rick mentioned, we're still conducting the prototype builds. So we're still finalizing costs there. However, again, we do believe it to be a very positive margin business. And we'll also come with follow-on parts, services, et cetera, too. So we expect that to do very well once we ramp up to full production and start getting the parts in that we need to build the scale.

Yes. And Jeff, I think today we have 3 or 4 individuals dedicated to production over at Aerospace business. We're buying one-off parts in the open market. And so as we look to model that out, we have better numbers probably for you in the fourth quarter in terms of -- it takes about 70 hours right now to build a drone. I'm not sure exactly where our target is in the future, but it will be a lot less than 70 hours. And we want to be able to get out and lower our build material costs. Even the way we do things today, it's still a very profitable business. So...

Got it. And then just 2 other quick ones. On the -- can you touch on your battery supply for '22 and '23 just given the inflation? If you could walk through how much batteries you have for next year? And more importantly, how the prices adjust given the inflation on nickel and lithium that we've seen in recent weeks?

So we're locked in on our contracts. We will have some metal modifications to these contracts. We won't really start getting into full needs until midyear next year. And of course, the sourced chassis that we're getting now come with batteries already in them. So we're locked in there as well. So it's -- right now, I feel like we're in pretty good shape there. Obviously, things change every month, it seems like. But right now, I think our timing works out well for us.

Got it. And the last question I had is just on the revised guidance to $150 million to $250 million. You mentioned supply chain and I think you mentioned 60 days of lost production. Can you just flesh that out a bit more? Was there particular semiconductors or were the chassis slower to evolve and come in than originally planned? Or was this all due to the C1000 redesign taking longer than expected? It was a bit unclear exactly why the guidance was revised lower.

Yes, it's basically 100% tied to the C1000. I think the redesign was more extensive than we thought it was going to be, talking about frames, full front suspensions, several issues that we caught during the FMVSS testing. So we've got a large list of -- probably, 30 or 40 different things on the vehicle had to be changed, which causes lots of parts configuration changes. So first, you got to get the redesigns done. You've got to validate that on your computers. Then you've got to go do some testing of parts. Then you got to go buy parts. And you're going to buy some parts from people who you just told we're going to kill the vehicle. So they're not too happy about doing that, right? So it took us a while to get some of that resolved. We had a couple of battery supply issues with our previous battery supplier. We had to get suspensions, and then we got backed up bringing those suspensions in from Asia. So it's lots of excuses. As my old Mama says, "Don't give me your excuses. Just deliver results." And we're going to make up that production and get it done. It might just take us a little bit longer than we thought. So it's still the plan: redesign, fully test, repair and build and sell C1000s. It might take us just a little bit longer than we thought. The good news is that we've had we've had fruitful discussions with customers that we think we have a home for every C1000 we're going to build. So...

Got it. And the last one. The 161 that you are repairing, how do we think about the margin profile of that just given you've already written them down? It was unclear if your guidance is only really based on revenue. But I wasn't sure in particular on gross margins as Union City ramps up. But selling a repaired vehicle, I haven't seen that flow through other P&Ls in the past.

Yes. I think it's pretty much an accounting answer as we wrote the value down to net realizable value. So the way that will flow out on the P&L is that basically revenue will equal cost more or less. And so the margin will be 0 on those. However, because the cash was spent last year, the cash flow will be pretty substantial on each one of those.

The next question is from Greg Lewis of BTIG.

Rick, I was hoping you could talk a little bit more about contract manufacturing, the opportunity with TROPOS. I guess those vehicles a little bit smaller, not directly competing with what Workhorse is going to be producing in the near and longer term, it looks like. I guess in that, like are they going to -- do you see the opportunity for additional contract manufacturing opportunities with other customers? And is this something where you've actually been able to kind of -- just given how you've quickly repositioned the company, is there an opportunity for Workhorse really to develop a niche in assembly for other EV producers?

Yes, a good question. First of all, remember, I consider myself to be an operational animal. So I love being in the factories and I like creating jobs here in America, right? So there is an opportunity here. What we inherited in terms of the Union City plant, there was good bones there, all right? Most importantly, there's good people there. And they had basically been left behind in the last decade as they changed ownership a few times. Lack of investment up there. So we've gone up and revitalized that. But again, the bones were good. We expanded and we leased the warehouse next door. We can convert that into a factory space. And we leased a storage place to put all our batteries rather than have them in 2 or 3 different places. So we have a unique situation at Union City to create a real hub for EV production. We had the land expand. We have the building space to do things. It's an opportunity. When you look at other EV manufacturers, they talk about, "We need to build a factory. It's going to take us 12 months or 18 months." Or some say 6 months. We already have a factory. We already have a workforce. We have a plant that used to employ over 1,200 people. When we got here, it had less than 100. Today, we have about 80 down there right now. We have a hungry environment. We've talked to the mayor. We talked to the state level in Indiana about how we get some incentives, whether that's tax breaks or training money to put people back to work in good jobs so they're not driving 40 or 50 miles away from the farming community of Union City to go find a good paying…

Okay. Great. Great. And then just...

Yes. One funny thing over dinner -- and we were talking about TROPOS. They're talking about, "Well, you guys are kind of in the middle of the country." I'm like, "Well, actually, you can get parts here pretty quickly. You can come down the St. Lawrence Seaway. You can come up through the southern ports. You can come up the Mississippi River." And so we had to give them a geography class. John and are California based guys. Not everything has to come through the ports in California and Washington, Oregon.

And lately, it's almost better if you're not.

Absolutely.

And you did -- I guess, on the drone opportunity, I guess, for a lot of people that have been following it, historically, this was going to be something that was going to really be something focused on last-mile delivery. I think you called out some government work. And as well as you have the Slide 12, where you have the different segments. I mean, I guess just looking at that, it seems like the near-term opportunity would be outside the conventional -- I don't know -- the conventional wheelhouse for how we thought the drone was going to -- the Horsefly was going to be used. Is there any way to kind of throw rough -- I don't know -- TAMs around what the drone opportunity could be over the next 5 years, even -- or maybe even outside of, say, last-mile delivery? Or is it still too early?

It's a little bit early. But I'll tell you, in less than a year, I'm more excited than I was when I first got here, okay? One of the first things I did -- I think the first 10 days, we had a review of the Aerospace business and site. And when you pull in and you can't find a parking spot because there's not enough room because we're growing. We could do some training outside, but limited training outside of the flights. Now we're in a different facility. We have plenty of parking. We have plenty of room to grow. And one of the first questions I asked John was, "What else could our drone do if we can carry a 10-pound package 10 or 12 miles? And we came up with some of the ideas about the aerial reconnaissance and the mapping that's led to a grant from the USDA, which has led to multiple grants from the USDA, which has led to opportunities at states to do some transport of parts like in the oilfields up in North Dakota to around the Ohio 33 corridor here to move parts. We've talked about moving medical supplies between hospitals and blood banks. It's almost endless. We've had to actually step back and say, "Hey, let's focus. Yes, our bird can carry 10 pounds. It can go 10 or 12 miles, basically a round trip. What else can we do?" And so it's very interesting, as I say. It's probably too early to tell you the TAMs, but I would tell you that we think it's pretty robust. We wouldn't have moved into a 75,000-foot space, probably triple what we needed from the old space. But if we can put our supplies in there and we can manufacture in volumes -- I think we've said before: 10, 20 this year; hundreds next year. We're talking thousands of drones by '24, all right, at pretty good pricing. And the pricing there -- it's a new market. There's not a lot of players. There's 2 opportunities we're talking to very actively about delivering last-mile delivery: one off the truck and one not off the truck. And there's other opportunities to deliver packages around the world. Greg, we'll try to give you some more details over the next few quarters on the opportunity in the drone business, but it's real.

The next question is from Colin Rusch of Oppenheimer.

As you start to ramp here, can you talk about some of the key manufacturing challenges we're seeing? Certainly, any number of folks struggle with some of that initial ramp. But I'm curious what you guys are seeing given kind of your long history around strong execution in those regards?

Yes. It's a good question, Colin. So obviously, there's supply chain challenges, whether that's ports that are backed up or the cost of freight coming over from there. But we got that built into our models. And we've looked at bringing some of the trucks from Asia, different ports versus coming into Southern California. So that's number one, is more logistics. The first trucks we build, the W750 and the W4CC -- the W4CC is pretty much a simple truck to assemble and -- rebadge and assemble. We can get those out there. There's strong demand out there right now. There's not any other Class 4 truck that I know right now that can carry 5,000 pounds. If there is, let me know and we'll go find out and benchmark it for sure. The W750 is a little more complex. There, we have a tight timing to finish the design and source all the parts to go ahead and put the van backing, so it can become a delivery fan, right? One of the things we're doing is -- as you know, I'm a big practitioner of Toyota production system. We've gone through extensive training with the same consultants I've used at several companies to teach our guys the fundamentals of lean value stream mapping; PEP or plan for every part; operator balance charts, machine balance charts; material flow; working capital management. And so we're getting that button down pretty good. I'm starting to hear the language when I go there, runners, repeaters and strangers, not just the truck business, but also the Aerospace business. Not just the manufacturing people, but the supply chain, the finance people are talking the same language as well. So it just react, teaching people lean, exercising our muscles and working through supply chain logistics. I'm not worried about torque tools. I'm not worried about getting a dynamometer installed. All those things are pretty standard equipment. And we have a workforce. It's not a bunch of young kids up at Union City. We have some experienced manufacturing people in their 30s, 40s and 50s who built complex chassis for General Motors and for Navistar in the past. So I'm confident they know what to do.

Excellent. And you alluded to this a little bit. With the competitive environment, there's been a lot of money raised with a number of platforms and there's a limited number of folks that are actually producing vehicles at this point. As you look out at the landscape with the redesign on the platforms and in talking with customers, what can you say about the competitive positioning that you're seeing for Workhorse? And how your trajectory is looking relative to some of your peers?

Yes, a good question. So I'd tell you, it's a Wild Wild West in the EV space, especially on commercial vehicles. Yes. There'll be some casualties. We've talked about that before. Even from the first time -- at the ACT show, I sat down at lunch and said, "Some of these companies are fake and some of these companies are real. Which are the ones who are our biggest competitors?" We've narrowed down who we think are going to emerge as the real competitors in our space. We're not worried about people doing big trash trucks or stuff like that. We're worried about who's going to try to compete with us in the Class 3, 4, 5, 6 delivery -- last-mile delivery. There, we think we're well positioned. We lost about 12 or 18 months with our misfire on the C1000, but we've quickly pivoted and we are -- we feel we're in a really good position with the W750, the W56 that's coming down the road. Those will be benchmarked vehicles, and we can go out and win our share of the market. We don't have to win a huge percentage of the market share to be a successful profitable company, right? As I said in the past, some of the space has been a duopoly for a long time, a duopoly in chassis, which are restricted, and a duopoly in body upfitters, which is somewhat restricted with capacity. So the market needs someone like us to come in. And not everybody is happy we're coming in. But we know we're going to come in, and we're going to fight and win.

The next question is from Chris Souther of B. Riley.

Maybe on the W56. You mentioned 75% of the build materials is locked in here. What are the critical components you're still looking to dial in over the rest of the year here? And could you maybe walk through vehicle -- how vehicle pricing is shaking out as we're getting better clarity on the supply chain? That would be helpful.

Yes. We're basically 85%, 90% sourced on the key chassis components, so the brake, suspension, batteries, I should say, powertrain as well. The last things really to source are going to be the cab, the body, some of the interior. And that stuff has shorter lead times. So I think we're still within our lead time targets. We have a very disciplined process we put in place here now, where we track both the time lines and the dates we have to meet so we don't get behind schedule. And two, we have budgets, right? And so that's something that was new here, I think, at Workhorse. You just can't design a truck that works. You got to have a design a truck that works, is safe, is reliable and makes money. And so we're trying to put that discipline in here. It's like that. So I think we're in good shape. You asked the question -- well, you asked about a specific part or -- did you say brakes? Or what did you say? I can't remember what you said.

No, I was just -- what were those critical components which you addressed? And then just the vehicle pricing. How we see that kind of shaking out as we're getting better clarity on the supply chain? It sounded like previously when you talked about it, you thought there was kind of room upward from where the C1000 had been pricing for the entire kind of fleet given the competitive landscape. I just want to get a sense on the W56, if you had any sense of pricing? Or if it's still too early to kind of tell there?

No, we know -- we bought a couple of the current competitor vehicles, non-EV, and we've torn those down. And so we know what they cost from a frame and body standpoint. We've seen some of the pricing from some of our competitors out in the marketplace, whether that's someone like Xos or BrightDrop and others. So we feel like we have a good handle on where we need to come in to be competitive and where we need to make money. And we've rolled that down to our manufacturing team from a labor standpoint, and we laid it down to our supply chain team from a component standpoint. So I think we're confident. So Bob is -- his team is right in there with us in all these reviews and making sure our models are right. And we'll see what happens. Now one of the wild cards is the money that the governments are going to put forward, whether that's in California, the HVIP program, or if this Inflation Reduction Act actually gets passed. You'll see significant incentives there to move towards EV-type vehicles, not just passenger cars and trucks, but also commercial vehicles. And so we'll take that into account as well. At the end of the day, you have to go and get an EV powered that can allow the final customer to make money in what they do with these trucks, whether that's taco trucks or delivering bread or delivering uniforms or delivering groceries or delivering packages to our houses, right? Electric vehicles based on the models, especially with diesel at $5 to $7 a gallon, higher than that in California right now, the TCO calculation gets pretty good. And we've done some work with one of our customers on drone deliveries and it's even better in terms of the cost of delivering a package, especially a small package, especially to a rural area or somewhere you've got to cross heavy congested traffic or river ways.

Okay. And then maybe just on -- it sounds like the guidance movement is -- the potential, from C1000 being pushed into kind of early next year. So I just wanted to get a sense of, if that was indeed the case versus -- W4 or W750 expectations remaining pretty similar. And then as we're looking at kind of that order book conversion for folks who had previously been waiting for the C1000s, can you just talk a little bit about what the customer discussions are? If you're either -- that kind of next-gen W56 versus the 750, where those discussions are kind of shaking out at this point?

Great. A good question. So yes, on the C1000 is that basically we're going to slide a little bit to the right. I told the guys, "Maybe no one goes home for Christmas unless they're all prepared and built." I think they're confident. It's all about getting the parts in, okay? And so we lost some time -- as Bob said, we lost about 60 days in some of the redesign and testing. And then it took us a while to get some of the parts. And we're just finishing up the due care testing actually this week. So that's C1000. But as I said, we think we have a home for every one of those. And we've adjusted some of the pricing that covers some of the repairs as well. W4CC and W750, the order we talked about today basically is a combination -- as Stan said earlier, it's a combination of purchase orders and build slot reservations. If you take a look at the build slot reservations, it's for almost 40% of the trucks we're bringing in with GreenPower. So we feel that's a good start. Now we've got to convert those reservations to firm orders, which we intend to do. But the customer that we've been working with on that program is very bullish about the EV space, has a lot of knowledge in the EV space and thinks he can sell a lot of these trucks. Some of them will have to be van versions, and some will be just go out to the market like a Mitsubishi or an Isuzu truck that gets a different package on the back. You can go to a lot of upfitters there. The W56 and the W750, our customers want to see the working prototypes. They've seen a couple…

The next question is from Mike Shlisky of D.A. Davidson.

I wanted to start off with a few follow-up questions of details on the TROPOS agreement. Can you give us a sense as to the tenure, the length of that agreement? How long will that go for? And are they building their own facility? And will this year when there's ramps up? And maybe secondly, what does TROPOS' supply chain and their order book look like? Do you feel confident that they'll have 2,000 units a year starting next year?

So the agreement is for 3 years. I think they will continue to look for ways to enhance their production capabilities. But they really like our facility and location as a key spot for the U.S. market. In terms of their supply chain and customer book, we've been very impressed. That's why we wanted to do this deal. We think they've got not only a good supply chain, but a good supply chain strategy. And they absolutely have customer book and demand.

Yes. One of the nice things about TROPOS is they're out talking to some customers that would not be our first target from a last-mile delivery, but they're institutions or organizations who are fully committed to going green. They've already ordered some of the TROPOS vehicles, and we want to come in behind with TROPOS and say, "Hey, let me also introduce you to a Class 5 truck or a Class 5 van." If you're going to do your whole university campus or, in some states, your whole state university system is going to go green, you got the small trucks, whether ambulances or shuttles or whatever, but you need some trucks to go service the cafeterias and the sports facilities, et cetera. And we think that's a target-rich environment. And we think that the TROPOS' team has been out ahead of us on that for probably 12 to 18 months.

Yes. Got it. Hello? Are you there?

Yes, we're here.

Sorry. I wanted to also ask quickly about your SG&A and R&D spend. There was a slight increase, and that's been happening obviously everywhere. I just want to get a little sense of the trajectory on SG&A and R&D going forward. Should we expect to see a little bit more increases in Q3, Q4 as you make those last few hires and some more investments in the C1000 and W750? And could things tamp down a little bit next year as some of those expenses roll off?

I think we're getting pretty well filled out on the teams. But I will remind you, as you think about modeling out third, fourth quarter that, as Rick mentioned, we have a new VP of sales starting here. And we've not really had a full sales function. And we'll want to round that team out with some expertise on the selling side. So we still have that to add into this. So I think -- if you think about your model, I think you'll still see somewhat of an increase in third and fourth quarter before we're fully loaded and leveled at that point.

Yes. As Bob said, we're 95% full. Now let's tweak it a little bit and then it kind of stabilizes. Then we got to drive the volumes up across the fixed assets. So a lot of expenses to pick up and relocate 1, 2 teams, recruiting fees to higher the talented people out there, onboarding costs, just getting basic fundamental systems in place. But we understand where we're going.

Okay. Okay. Maybe lastly, I want to touch on charging real quick. A few companies we heard from this quarter have discussed charging as a bit of a sticking point. The customers want vehicles, but they haven't put all the effort into and all the thought into how they're going to charge them once they get them. With Workhorse, you've got like a second bite of the apple here. You're kind of starting with some brand new platforms and vehicles. You had a charging strategy in the past. I was wondering if you're making any changes to how you will help customers make sure that they're ready to take these vehicles and charge them as soon as they get them? Or is your old strategy sufficient for the time being?

Mike, that's a great question. I'm still relatively new to this industry, but I continue to hear infrastructure, infrastructure, right? Obviously, the federal government is putting money forward, whether it's through the DOT Infrastructure Bill for charging systems. The Inflation Reduction Act adds some more money for investments in EV infrastructure. The Department of Energy has put forward some grants to allow companies like ours to transform old ICE-related factories over to EV. So there's lots of opportunities there. We have a partnership that we signed up with ChargePoint. We think they're the leaders here. We've been out and checked out their hardware and their software. I'll just say stay tuned. We're working on some things we'll probably talk about later in this year.

There are no further questions at this time. I'd like to turn the call back to Rick Dauch for closing comments.

Thanks, Brock. Thanks again, everybody, for calling in and your interest in Workhorse. We have a good team. We've got solid products. We've got great facilities, and we need to go put our nose to the grindstone to work and kick some ass. Have a good day. Talk to you later. Bye.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.