 Hi, this is MXUX. I just want to do a brief intro on this. This is a bit of a complicated topic. We're going to find out if Lordstown Motors is going to go broke by the time they reach the start of production in Q3 2022. And I also have a quick review of a Rivian I happened to spot in the wild. And so I'm in regular traffic, not at a special setting. Hopefully giving an idea of what it really looks like. I saw a Rivian in the wild. I didn't get a photograph or a video of it, but I did see it. It was this same color and it was at night. And I just wanted to let you all know what was going on, how it looked. First of all, I hate the front end on this truck. I think it looks like a smiley face. At night in the dark, the headlights in the light bar make it look totally different. It looks pretty cool. I got to give it that. Okay. So that was the front of the vehicle. So the light bar, you know, pretty cool at night. Not bad. Not bad. Front end, don't like it. Okay. Second thing not shown here is the back end of the truck, the tailgate section. Incredibly plain. To the point of being bland. Absolutely no style cues whatsoever. Really looks generic. I don't know that they run out of money, narrow dynamics, whatever. As far as these flares on the side and these styling cues, absolutely looks flat at night with the regular street lighting. Thing looks like a loaf of Wonder Bread. Okay. I want to talk about the ride height. I don't know if whoever was driving this thing had it jacked up via their suspension, but this thing is really, really off the ground. Okay. Very high. And like I say, I don't know if that was the normal configuration, but the height here, you know, over 12 inches. And this is on a city street. So go figure. Anyway, overall, the truck itself. Okay. Here to here. Big truck. Big. Like a F-250. Big. Okay. Across the width from here to here. Really big. So this is a really big truck. Okay. It's much bigger than it appears here. I would hate to park this thing in a parking deck or even in a garage. I mean, that's how big it was. Now, the one thing that looked out of place was this bed back here. Dude, really short. Looks kind of unbalanced and awkward to me. That's just my take. And it was about, it was this color. It was this blue, green, aqua, marine, green, blue color. Horrible. I think it, personally, I mean, this is like the old crayon, original crayons. You got that one blue, green. It's kind of like that color. I thought it looked horrible in person. I am not a fan of this color. And it had the orange accents on it. And you could even see some of the orange here, even with the dim lighting. The orange clashed with this color. It looked horrible. Horrible to me. Just horrible. Of course, it was totally silent. It was moving really slow. But the other thing I was, I was shocked about was, you talk about tire noise. Wow. I don't know, maybe these are new tires, they're not worn in, you know, maybe they got to wear the edges off the tires or something. But I don't know how this thing sounds in the cab. But man, I'll tell you what, there was a lot of tire noise, a lot of tire noise. You could hear every four wheels. Every four, all four wheels as it went by, I mean, you know, like a semi trailer or something. Anyway, my overall impression of the truck, kind of a gelded pickup truck, if you know what I mean. The squat bed makes it look out of balance to me. I was shocked at how big it is, the volume it takes up. And, you know, I had just parked in a parking deck and all the spaces were more compact. I don't know how you would park this thing in that situation. I mean, it looked that big to me. I mean, this is, this is as big as a, you know, it's bigger than an F-150. A guy I know has a Silverado 2500. It's the one ton Silverado. It's that big. But, you know, there's two feet cut off the bed back here. So in my estimation, it looks a little awkward. And, you know, I would add, you know, you got the short bed that makes it look awkward. Then you got the really plain back. That looks awkward. It looks, it looks better coming than it does going. I'll tell you that. I'm not a fan of the Ruvian. This is an affair review, but I just wanted to give you my impressions of it. Bisa V, the Lordstown Endurance, which I have not seen live, but I gotta think it looks better than this. Anyway, not a big, I mean, I could see how some people might like this. I can see how it might appeal to females maybe, because it doesn't, it doesn't look that truck-like, but it's neither fish nor fowl to me. And it's really big, awkwardly big, with the short bob tail. Looks kind of weird to me. Again, the ride height was high. The width was wide. And man, that tire noise, it blew me away. I mean, there was a lot, again, I don't know. Maybe the, you know, maybe the edges have to wear off the tires, off the little checks in the tires, you know, whatever. Anyway, that's my impression. Hi, this is MXUX. I just want to go over this. What I think is going to happen with the ride as it goes to the Q3 2022. Will it go broke before it goes into production? SOP. So the main thing here, I think, and this is a back of the napkin. So this is really rough. This is kind of like remote veiling here. We're taking a look into the future. We don't know exactly what's going to happen. We got bits and pieces of information, but we're going to do an analysis anyway. And let me add that I do think they're going to make it to production. Anyway, let's just get started on this presentation. The most important thing that's an unknown here is that Lordstown will be reimbursed for OPEX. Don't know what that is. It's not defined from September 2021 to April 2022. So this is when they entered into the basic agreement to buy the plant. And then this is when the plant is supposed to close. So during that period, Foxconn is going to reimburse Lordstown for the OPEX. Now, what portion of the OPEX? We don't know. This is all being negotiated. The battery in the hub underline are Lordstowns. It's not going to be part of the deal. The sales administration and general, I don't know what this G stands for. I always forget the G. General administration, something. Anyway, that is part of Lordstown expenses for their own private thing, too. But what percentage of that will be reimbursed? I don't know. Will it be 50%? I mean, obviously, they're administrating the whole place. They're paying the general expenses. That's what that is. They're paying the electric bill. They're plowing the snow and so forth. And the taxes as well on the place. So will that be this is all up in the air? We don't know what this reimbursement is going to be. I'm going to try to estimate what it'll be. R&D is going to stop on the more powerful hub motors. 100 PPP vehicles are going to be manufactured between now and then. Mostly they're already underway. Is this going to be reimbursed? These are Lordstowns property. I don't think so. Okay. Lordstown is using at most 40% of the plant. Okay. And I'm including any materials they have stored out in the parking area or in the receiving area that were covered in my last video. Let's say they're using 40%. 60% of the plant, they're just paying to keep open via square feet. Could this be the metric? Could they just split it by square feet? Could they say that 60% of the OPEX is devoted to the empty plant? I don't know. It's one way of doing it. The current OPEX is about 90 mil and a quarter. It's 90-92. There's going to be three quarters as of right now as of today. Three quarters of OPEX before April 2022. Okay. And if you go from September to April 2022, so September to April, that's going to be eight months in some partial amount. So you fudge it to three quarters. So we're looking at, I don't know, three quarters of reimbursement. If they give them the full 90 million, which isn't likely, and that includes everything, that's 270 million. If they go with 60%, so in other words, they cover the cost for the 60% of the plant that's empty during this time. That would be 162 million. So this reimbursement, I mean, I don't know, if you had to put a number on it, would that be the number? Would that be close? We don't know. But if you go by some common metric like that, that's what comes out. So the capital raise for the plant total is 230 million in cash, 50 million in stock, and the reimburse, which we don't know, which we've calculated at 162. So is everybody on board here? All right, let's move on to the next section. So here's the total income. We got 50 million in stock that Foxconn bought. They put 100 million down in November. February 1, there's going to be a payment of 50 million. On April 15, there's going to be a 50 million payment, and there's going to be a 30 million payment on, let's say, May 2022 when the deal closes. So it's 280 million from the sale, and that's not including the reimbursement. And that's three quarters of OPEX at current levels. So basically the sale cost is going to equal the time they're waiting to start production as far as OPEX goes. The capital on hand at the end of Q321 is like 2.7 quarters. So there's supposed to start production in Q3 2022, and that is in four quarters. All right, if you add all this up, you got 5.6 quarters funding available without reimbursement. And there are some stock warrants involved here that I'm not accounting for. If you add in the OPEX reimbursement at 60%, you get another 1.8 quarters. So you got 7.4 quarters of OPEX available at 90 million a quarter, and four quarters till start of production. So you got an excess of 3.4 additional quarters of OPEX at 90 million for a start of production in Q3 based on prior OPEX, which will change and lightly go down. Okay, so what this works out to is Lord Sound Motors will have 306 million in cash at the start of production. And that's with the estimate of 160 whatever for the reimbursement. If we back the reimbursement out on 62, but if we back the reimbursement out of that, it's still 200 million, 240 million. So will they be able to start production? They're going to have 240 million minimum. I'm estimating at the high end, 306 million. This is at the start of production. Is it enough? Who knows? They always need 500 million in these car companies. But they're going to be positive cash by at least about, you know, I don't know, let's say 200 million at the start of production. Now that's a pretty close call when it comes to cars though. That's not a lot on hand. But basically they're going to have at the start of production what they have right now. I'm trying to find that figure. I can't find it. They're going to basically have this exact same figure when they start production. Okay, so the sale and all these proceeds are going to cover everything for this fallow period. And then when they start production, they're going to have this basically this amount of money on hand 230 million 234 million. That is what they're going to have. And they may have more. Is that enough to start? I think it is. I think it is enough to start production. And their costs are going to go up. But let's take a look at their costs. Once Foxconn takes over this plant, the OPEX drops because all the production costs shift over to Foxconn. And all the maintenance costs shift over to Foxconn. And most of the administration costs shift over to Foxconn. So they're going to see a big drop in their OPEX costs. Likely the R&D costs will drop at Lordstown. SAG sales administration and general expenses again is going to drop markedly. And now the sales and general expenses, they're going to be there because they're going to sell the truck. But the rest of it, you know, the taxes all overhead the HR. And this, this is going to be a big drop in their, you know, their 90 million a quarter operating expenses they have now. Also, the vehicle is going to be approved for production. All that pre production costs and so forth, PPV vehicle costs is all going to be behind them. So there's going to be a lot of cost cutting going on here just by nature of doing the deal. Now there's going to be some costs that are going to appear as well from this deal. They're going to pay Foxconn a fee for each vehicle made if they work it out that way. So let's say, you know, whatever their fee is, you know, $5,000 vehicle, $10,000 vehicle, whatever they decide to charge. Let's say that they're going to charge it, right? It's $5,000, whatever. LMC is also going to have to go into mass production for each drivetrain needed. They're going to have to build the batteries, the battery packs and the hub motors. So that is going to be an increase that they're going to face is scaling up those productions. And they're going to pay for the sales administration and general expenses for endurance deliveries in the United States. That is another cost that's going to increase. On balance, I don't know, I think there's a slight, I mean, I think there's an edge to cost cutting here. And the other thing is they're going to be able to turn off and turn on production easily with Foxconn running the plant. They're not going to have to, you know, face shutdown and startup costs. So that gives them a lot of flexibility. And again, a lot of things are going to drop, a few things are going to go up. All in all, I estimated in the past, there's a 30% margin on each endurance. That's past estimate. And the first two years of production per prior videos and research are sold. So will this margin get hurt? You know, it's going to be paying Peter to out of one pocket into the other pocket. Is it going to be a wash? I don't know, it looks like it might be a wash or close to it. So are they going to maintain the margin? Maybe. I think the margin is going to get a hit by the production cost on each. Of course, Lord's time is going to have to buy the bill of materials for each car. They're going to have to pay for the materials. And they're going to have to pay the fee for the manufacturer or the putting together those things. And they're going to have to buy the drivetrain too. But do they have enough money to pay for all those things and get started? I think so. The battery pack is going to cost what, like $8,000? Let's say the motors are going to cost $4,000. So you've got $12,000. Whatever the rest of the truck is is $7,000, $10,000. So that's $22,000. Anyway, they're going to come close to keeping this margin, I think. And they're going to have the flexibility of turning things on and off easily when demand slows. And also, Foxconn's supply chain may be able to even get their bill of materials costs down on the more generic items in the production. You know, can it all work? Is there a synchronicity? I think there is. Do they have enough money to get started? Yes. Do they have between $200 and $300 million? Yes, they do. Is it enough? It's never enough with the car company. Do they have a revolving line of credit based on stock price that might go up right as production starts? Yes. Can they access $400 million there? Yes. Will that give them between $700 million and $600 million? Yes. Would that be enough to do the production? Definitely. Would it dilute the stockholders somewhat, but it would guarantee the start of production? In any case, I do think they can swing it. They also can do convertible bonds or other debt financing. Foxconn could possibly give them financing against receivables, so forth, as far as their payment for their fees. Once they get started, the first two years of production are supposed to be sold. That's seven cars a minute to start and then four cars, I'm sorry, seven minutes of car to start production. Then four minutes of car once the line gets up to full speed so they can pump out a car every four minutes at full speed. They can get the revenue wheel going. That's it. I think they can do it. I think they can swing it. It's Lordstown. It's on the edge. It's not Rivian. They don't have $10 billion in the bank, but they have a much better product than Rivian. Will this method be cheaper of bill of materials with Foxconn in charge? Most likely, yes. Foxconn is a supply chain specialist. Will the unit cost be lower with Foxconn manufacturing? Probably, probably, because the bill of materials is going to be lower and maybe they can bring in some advanced manufacturing techniques that aren't being used now, especially supply chain, moving materials to the line and so forth, that could also lower costs more than they are right now. Will the battery hub motor cost go down with mass production? Yes, it will. The question has already been, the hub motors are slightly more to produce right now than induction motors, for example. However, once you move into mass production and you get that really clicking, they should go down and become equivalent, or at least close to equivalent, with other things. The thing is, even with the higher cost of the hub motor, because it's so simple and so many other parts are eliminated, it actually is cheaper than an induction motor overall. But anyway, that's also going to go down. So, there's a lot of things that are going to go down when this starts. Look bigger now. Anyway, the point is, yeah, I think they can do it. I think they can get started. It's going to be a close call. They may have to do a capital raise. They may sell some bonds. They may borrow against receivables. Who knows? But are they going to be $0 bankrupt? No, they are not. They are not going to be $0 bankrupt at the start of production. That's not going to happen. Now, there are unknown unknowns. Potential SEC fines could come in. No, it's right. That could be really bad, and it would increase their legal cost, their administrative costs as well. So, we don't know if that's going to happen. Sale of plant, not approved by CIFAS. This is a poison pill in the agreement. If CIFAS does not approve this, then Lord Stein is going to have to pay back everything. That is a worst-case scenario, and that would zero out their cash position or very close to zero it out. So, the CIFAS approval has to go in. By the way, that's what's holding everything up. The CIFAS approval is going to be at the end of April. I don't know if I've said this. That's when they're going to give their issue their decision. That is going to allow Foxconn to be listed as the manufacturer on the certification for the vehicle, and that's what's holding everything up right now because they can't certify the vehicle until they have the manufacturer. Anyway, the point is, once this CIFAS goes through, the manufacturer is applied to certification. It's green light all the way. Now, another thing that hasn't been mentioned is there was a blurb that said Lord Stein would sell the truck domestically, and Foxconn will sell internationally, which would mean what? We don't know. Probably that Lord Stein would get a royalty on each truck sold, which under the present circumstances, Foxconn has a massive distribution network and so forth and presence across the world, and they are in a better position to sell internationally. This might be a better deal for Lord Stein, at least at this point. Who knows what this clause is, how long it goes on for, but this actually might increase Lord Stein's sales more quickly internationally than they could do it on their own. This is really a positive, I think. Also, I didn't want to mention this, but we've got to bring it up. The advanced vehicle manufacturing blah, blah, blah loan that Tesla got. Lord Stein was signing up for $250 million on this, I believe. Foxconn has entered in on that deal, and as for more, Foxconn is an expert at getting these loans around the world. It's one of the things they do when they open a factory. We'll have to see how it works. This could be a lot of money for the complex. Another $200 million for Lord's Town. Probably put them in the ballpark of $500 million for sure to start production, so that would probably be the best case scenario. But in any case, is Lord Stein going to go broke? No. Do they have a lot of excess fund? No. Once they start making money, can they squeak by and get the car out and start? I think they can. It's going to be close. It's not, like I said, they don't have $10 million. That's my analysis. I think they can do it. I think they can do it. I think the numbers are there. You guys can go through this slowly and tell me what you think. This is just, I'm not a financial advisor. This is a case study. This is back of the napkin. This isn't generally accepted accounting principles. This is my own idea as an analysis. Investing in ride could result in catastrophic loss. It's a pre-revenue, SPAC, EV manufacturer, under investigation by the SEC and DOJ. Those are a lot of strikes. Okay? It's a risk on and high risk investment. Okay? Good result in catastrophic losses. Do your own due diligence? Always seek advice of a professional manager before making any investment. Anyway, that's all I got to say. I think according to my work here that they're going to have, you know, let's say they go get the loan, they're going to have 500, close to 550 million best case scenario, 200 some million, 225 million worst case scenario. The cost should go down, but their bill of materials cost is going to go up and their battery production and hub motor cost is going to go up. But all in all, it looks like it's going to balance out. I'm sure they've done the math on this over at Lordstown. Again, this reimbursement is critical, perhaps that loan. I'm not confident, totally confident they're going to get that loan, but they may. That's also critical. But that's my analysis. I hope you liked it, guys. High risk, possible high return. And I do think they can do it. All right, this is MXRX. Thanks for watching.