BREA, Calif. - Mullen Automotive, Inc. (NASDAQ:MULN), a manufacturer of electric vehicles (EVs), announced today the creation of Mullen Credit Corporation (MCC), a fully owned subsidiary to support its dealership network with vehicle floor planning and provide financing options for fleets and small businesses.
The establishment of MCC is part of Mullen's strategy to accommodate its rapid business growth and the projected sales increase for 2025. David Michery, chairman and CEO, stated that MCC will offer "financing flexibility for our dealers and customers as we pursue accelerated growth and expand our market share."
Mullen's commercial EV lineup includes the Mullen ONE, a Class 1 EV cargo van, and the Mullen THREE, a Class 3 EV cab chassis truck, both of which comply with U.S. Federal Motor Vehicle Safety Standards and have received EPA and California Air Resources Board (CARB) certifications. The vehicles have also qualified for various state and federal incentives, including a $15,000 incentive through Massachusetts' MOR-EV program and up to a $45,000 cash rebate voucher in California through the HVIP program, in addition to a $7,500 Federal Tax Incentive.
The company’s commercial dealer network recently expanded with the addition of Papé Kenworth, joining other dealers such as Pritchard EV, National Auto Fleet Group, and others, providing sales and service across key U.S. markets.
Mullen Automotive operates two U.S.-based vehicle plants in Mississippi and Indiana and has been in commercial vehicle production since August 2023. The company has also been approved for federal EV tax credits and has received Foreign Trade Zone status for its Mississippi manufacturing center, offering benefits such as duty deferment.
This announcement is based on a press release statement from Mullen Automotive and contains forward-looking statements regarding the company's plans, which involve risks and uncertainties that could cause actual results to differ materially. These statements have not been independently verified, and the company's performance should not be relied upon as a guarantee of future results.
In other recent news, Mullen Automotive has made significant strides in its operations, including a projected $75 million in GAAP revenue over the next six months and a reduction in monthly spending by $5.5 million. This is part of the company's strategic move to enhance its financial position and improve operational efficiencies. Mullen Automotive also reported a substantial 6791% surge in quarterly revenue, bringing it to approximately $4.5 million for the quarter ended September 2024.
The company has expanded its dealer network and initiated a 1-for-100 reverse stock split. Mullen Automotive's vehicles have received certification from the California Air Resource Board and the Environmental Protection Agency, qualifying them for federal EV tax credits.
In terms of financial developments, Mullen issued convertible notes and warrants, raising around $12.5 million. The company also secured a $3.2 million order from Papé Kenworth for a fleet of commercial electric vehicles and received a $210 million order from Volt Mobility. These recent developments highlight Mullen Automotive's transition from pre-revenue product development to revenue generation.
InvestingPro Insights
As Mullen Automotive (NASDAQ:MULN) embarks on its ambitious expansion plans with the creation of Mullen Credit Corporation, investors should consider some key financial metrics and insights from InvestingPro.
According to InvestingPro data, Mullen's market capitalization stands at a modest $3.84 million, reflecting the company's current position as a niche player in the competitive EV industry. This aligns with one of the InvestingPro Tips, which notes that Mullen is indeed a "niche player in the automotive industry."
The company's financial health presents some challenges. An InvestingPro Tip warns that Mullen "may have trouble making interest payments on debt," which could be a concern as the company scales its operations and launches new financing initiatives. Additionally, the tip that Mullen is "quickly burning through cash" suggests that the company's aggressive growth strategy may be putting pressure on its financial resources.
On the valuation front, Mullen is "trading at a low Price / Book multiple" of 0.11, as per InvestingPro data. This could indicate that the stock is undervalued relative to its assets, potentially offering an opportunity for investors who believe in the company's long-term prospects.
It's worth noting that InvestingPro has 19 additional tips available for Mullen Automotive, which could provide further insights into the company's financial position and market performance as it rolls out its new financing subsidiary and expands its dealer network.
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