\n<\/p>\n
Arrival set out<\/span> eight years ago to make electric vehicle production \u201cradically more efficient.\u201d So far, its plan to forgo the gigafactory<\/a> for local microfactories has proved anything but.<\/p>\n Arrival trumpeted how its automated microfactories would simultaneously churn out electric vans for UPS<\/a>, cars for Uber drivers<\/a> and buses for the U.K.<\/a>, Italy<\/a> and California<\/a>. The past 15 months provide a different story line. The company laid off workers four times, slashed production targets and dropped its Uber car and bus programs. It\u2019s even struggling to meet Securities and Exchange Commission filing requirements. The company reported Friday in a regulatory filing<\/a> that it missed another deadline to file its 2022 annual report, putting it out of compliance with the Nasdaq Exchange. If Arrival fails to appeal, Nasdaq will suspend trading of its ordinary shares November 9.\u00a0<\/p>\n Arrival, which went public via a merger with a special purpose acquisition company in the high-flying meme stock days of 2021, appears to have<\/span>\u00a0little hope of realizing its goals.\u00a0<\/span><\/p>\n Prior to its first SPAC, Arrival started life in stealth. Will it die the same way?<\/p>\n Arrival\u2019s next earnings report could shed light on whatever gas it has left. Yet, since the company failed to share its September financial report, and hasn\u2019t responded to TechCrunch\u2019s requests for comment, we\u2019ve rolled back the clock ourselves to put Arrival\u2019s current state of limbo into context. Here\u2019s how Arrival, a company that debuted on Nasdaq valued at $13 billion, has withered over the past 15 months to a market capitalization of just under $20 million.\u00a0<\/p>\n Layoffs first hit Arrival in July 2022, when the company said it would slash its workforce by 30%<\/a>. Arrival had 2,700 workers at the time across the U.K., EU and U.S., per the Financial Times<\/a>. By that math, the company would lay off more than 800 people.<\/p>\n At the time, the Hyundai-, BlackRock- and UPS-backed startup was far from alone \u2014 Tesla<\/a> and Rivian<\/a> also announced significant layoffs around this time. Collectively, the automakers blamed a looming recession, rising interest rates, inflation, the pandemic, supply chain issues and so on, for the jobs they eliminated.\u00a0<\/p>\n In August 2022, Arrival founder and CEO Denis Sverdlov looked back at the second quarter and noted \u201cbig achievements<\/a>,\u201d including EU certification for its van<\/a> and bus<\/a>, and \u201csuccessful internal trials [\u2026] on public roads.\u201d The CEO added that Arrival would produce EVs in its first microfactory in a matter of weeks \u2014 a moment he said would \u201cfundamentally change the automotive industry.\u201d Sverdlov also doubled down that Arrival would deliver its first vehicles to UPS that year, and kick off U.S. production in Charlotte, North Carolina in 2023.<\/p>\n The company would make good on at least one of those promises.\u00a0<\/p>\n Arrival\u2019s reported cash on hand was $513 million at the end of Q2 2022. The publicly traded firm said it would raise an additional $300 million from investors via an at-the-market stock offering<\/a> based on its share price. For reference, Arrival opened on August 1 at $77<\/a> per share.<\/p>\n By the end of September 2022, Arrival celebrated its first microfactory-built van<\/a>. Reaching the milestone was \u201cmore difficult than we had initially imagined,\u201d said Sverdlov. Tucked into the announcement was news that everything Arrival made in 2022 would \u201cbe used for continued testing, validation and quality control\u201d \u2014 and not sold to customers.<\/p>\n Arrival initially said it would deliver 10,000 EVs to UPS \u201cfrom 2020 to 2024<\/a>.\u201d The shift meant the company had just two years to reach that goal.<\/p>\n Arrivals big pivot<\/a> to the U.S. came in October 2022, just one month later.<\/p>\n Arrival\u2019s stock price steadily declined. By mid-October, it slipped to around $35<\/a> per share. On October 20, the company announced that, \u201cdue to the current share price and daily trading volumes,\u201d it did not find the at-the-market offering to be \u201ca reliable source of capital.\u201d (So much for that $300 million.)<\/p>\n To save its expansion plan in Charlotte, North Carolina \u2014 and take advantage of Inflation Reduction Act<\/a> EV credits \u2014 Arrival abandoned its plan to scale up production in the U.K. The company said it would \u201crestructure\u201d in order to \u201cfocus resources on a family of Van products.\u201d That meant layoffs, and hitting pause on its bus and Uber-inspired electric car.<\/p>\n A depiction of Arrival\u2019s UPS van. Image Credits:<\/strong>\u00a0Arrival.<\/p>\n<\/div>\n Arrival also had plans for a U.S. factory in Rock Hill, South Carolina, where the company said it would produce electric buses by the end of 2021. Arrival even received a $500,000 grant from South Carolina\u2019s Commerce Department, on the condition that it create 240 jobs and invest $45 million into the facility. If Arrival doesn\u2019t meet those commitments by December 3, 2025, it will be \u201crequired to repay a pro rata portion of the grant funds disbursed,\u201d SC Commerce Department spokesperson Alex Clark told TechCrunch over email.<\/p>\n It seems Rock Hill has yet to produce a single bus. Arrival\u2019s \u201cproject in Rock Hill is not active,\u201d York County\u2019s director of economic development, David Swenson, clarified in a separate message to TechCrunch.<\/p>\n When Arrival reported its third-quarter results in early November 2022, it disclosed a $310.3 million loss. (Up from $30.6 million in Q3 the prior year). Sverdlov said the company would hunt for additional capital after a \u201cchallenging year.\u201d The CEO argued that Arrival\u2019s IP still gave it a \u201cunique advantage in developing electric vehicles and adapting to new market conditions quickly.\u201d<\/p>\n Arrival reiterated that it would restructure to extend its runway, cutting jobs \u201cpredominantly in the UK.\u201d The company didn\u2019t say how many jobs it would cut, but if we assume the earlier disclosures and reports were accurate, the math says it eliminated roughly 300 roles during the third and fourth quarters of 2022, leaving it with about 1,600 staffers.<\/p>\n Arrivial told investors it would end the year with between $160M and $200M in cash, and it warned that revenues wouldn\u2019t come until 2024. The firm added that the cash it had would fund the firm \u201cinto Q3 of 2023.\u201d<\/p>\n Weeks later, Arrival\u2019s wealthy, visionary founder\/CEO stepped down<\/a>. Sverdlov switched places with Arrival\u2019s board chair Peter Cuneo, who previously led Marvel and got involved with Arrival via the SPAC merger.<\/p>\n Arrival\u2019s president and strategy boss Avinash Rugoobur also stepped down around the same time, \u201cfor personal reasons.\u201d<\/p>\n Arrival reiterated to investors that its \u201cmission is to master a radically more efficient\u201d method of making EVs. Sverdlov said in a statement to The Guardian<\/a>, \u201cI am more committed than ever to ensuring Arrival\u2019s success.\u201d The company\u2019s stock price fell to around $17 per share.<\/p>\n By the end of January, Arrival appointed another CEO \u2014 its former digital boss Igor Torgov. The company said it would halve its remaining workforce to about 800 employees. Arrival said it brought on a consulting company called Teneo to help it find funds. Soon after, it raised $50 million<\/a> in equity from Antara Capital, a hedge fund.<\/p>\n By March 2023, Arrival\u2019s fiscal 2022 looked all the more dire. The company said it finished 2022 with $205 million in cash<\/a>, and Hyundai executive Yunseong Hwang left the board.<\/p>\n In April, Arrival planned to merge with another blank-check company<\/a>, or SPAC, to avoid bankruptcy. The deal pegged Arrival\u2019s value at around $524 million. (Two years earlier, Arrival was valued around $13 billion<\/a> on the Nasdaq.) Come May, Arrival said it ended the first quarter of 2023 with $130 million in cash. The van was still in the works, targeted \u201cfor production in 2024,\u201d according to Arrival\u2019s CEO. He added that the planned SPAC deal \u201cvalidates Arrival\u2019s strategy.\u201d<\/p>\n By early July, the reSPAC deal died<\/a>. Arrival\u2019s stock price hovered around $2.60 per share.\u00a0<\/p>\n Arrival\u2019s efforts in Charlotte are also in question.\u00a0<\/p>\n Axios Charlotte<\/a> reported in August 2023 that Arrival removed a sign from its offices there, noting they looked empty. The company said it maintained a diminished presence in the city, adding that it \u201cis committed to maintaining our North American headquarters in Charlotte.\u201d Also that month, Arrival announced<\/a> that it would report its Q2 2023 results in \u201cearly September.\u201d It didn\u2019t.\u00a0<\/p>\nLayoffs<\/strong><\/h2>\n
\u2018Big achievements\u2019<\/strong><\/h2>\n
First microfactory van<\/strong><\/h2>\n
U-turn<\/strong><\/h2>\n
More layoffs<\/strong><\/h2>\n
The swap<\/strong><\/h2>\n
Yet more layoffs<\/strong><\/h2>\n
Running out of cash<\/strong><\/h2>\n
Undelivered vision<\/strong><\/h2>\n