*Robert Lea, Industrial Editor, Monday August 29 2022, 12.01am, The Times*
Electric buses to be built at a new factory in Oxfordshire have been delayed by at least 18 months because their maker cannot raise more capital.
Arrival, a trailblazer of Britain’s transition to zero-emission automotive manufacturing, was founded by Denis Sverdlov, 44, a Russian tycoon. It reversed on to the US stock market via a so-called blank-cheque company and its valuation soared to $19 billion at one stage. However, doubts about Arrival’s ability to deliver have knocked that value down by more than 95 per cent.
That, in turn, has stalled its ability to raise more capital and Arrival has now halted plans to go into production of its single-deckers, which can carry 35 standing passengers and 35 seated. It will concentrate on assembling vans for the likes of UPS and Royal Mail.
Arrival had planned to get buses into operation for First Group in spring this year. It has indicated that now it will not begin production of those buses until later next year at the earliest — and even that will depend on its ability to raise money on capital markets.
Among the technology the buses will carry is the ability for passengers to locate them on an app. It also will allow bus companies to track demand in specific areas and at specific times.
Arrival had a little over $500 million in cash at the half-year but is burning through more than $100 million a quarter. That has led it to cut staff levels that had swollen to 2,700 people. As many as 800 are going, with up to 400 jobs lost at its operations in London and Bicester in Oxfordshire.
The crisis has also delayed the stepping up of production of its electric vans. It had forecast that it would build up to 600 vans this year but with its first microfactory in Bicester yet to go live, that has been pared back to deliveries by the end of this year of just 20.
Avinash Rugoobur, 41, Arrival’s executive director, said: “It is prudent to manage our [cash] burn to ride through the turbulence and wait for capital markets to recover.”
Prototypes of its bus have received regulatory clearance and are operating on roads, shuttling staff between its Banbury and Bicester sites. Rugoobur said the decision to pause development of the bus meant Arrival could concentrate on getting the Bicester microfactory up and running and capable of producing 10,000 vans a year. It will then turn its focus to replicating that low-cost microfactory, typically costing £50 million to set up, with a similar facility to build vans in Charlotte, North Carolina, for the American market.
The delay in production comes as competition to deliver such vehicles hots up. Of Go-Ahead Group’s 5,000 buses, 300 are now electric, coming from Chinese manufacturers such as BYD and Yutong. Stagecoach is taking electric buses from Alexander Dennis. Wrightbus, which is building buses in Northern Ireland, is making hydrogen vehicles.
Rugoobur denied that Sverdlov’s previous role as a minister a decade ago in the government of President Putin was putting off investors or customers. “He has been open and transparent and the [UK] government and the US have cleared us,” he said.
After the Russian invasion of Ukraine, Sverdlov, Arrival’s chief executive, said: “ I’m strongly against war or discrimination of any kind. I was born in Georgia and worked in Russia. My wife, three kids and I left Russia in 2013 before [the Russian invasion of] Crimea and I was shocked at that time . . . I have no connection to the Russian government in any form.”
The van’s are really cool, and the buses seem viable as a product.
I was always doubtful about the ‘micro-factory’ concept though. The future seems to be in the other direction – massive giga-factories churning out millions of identical vehicles as fast as possible through innovative design and automation.
Hopefully someone will swoop in and pick up the IP and keep them in production.
Funny they were the UK’s most valuable company briefly in 2021
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Article contents:
*Robert Lea, Industrial Editor, Monday August 29 2022, 12.01am, The Times*
Electric buses to be built at a new factory in Oxfordshire have been delayed by at least 18 months because their maker cannot raise more capital.
Arrival, a trailblazer of Britain’s transition to zero-emission automotive manufacturing, was founded by Denis Sverdlov, 44, a Russian tycoon. It reversed on to the US stock market via a so-called blank-cheque company and its valuation soared to $19 billion at one stage. However, doubts about Arrival’s ability to deliver have knocked that value down by more than 95 per cent.
That, in turn, has stalled its ability to raise more capital and Arrival has now halted plans to go into production of its single-deckers, which can carry 35 standing passengers and 35 seated. It will concentrate on assembling vans for the likes of UPS and Royal Mail.
Arrival had planned to get buses into operation for First Group in spring this year. It has indicated that now it will not begin production of those buses until later next year at the earliest — and even that will depend on its ability to raise money on capital markets.
Among the technology the buses will carry is the ability for passengers to locate them on an app. It also will allow bus companies to track demand in specific areas and at specific times.
Arrival had a little over $500 million in cash at the half-year but is burning through more than $100 million a quarter. That has led it to cut staff levels that had swollen to 2,700 people. As many as 800 are going, with up to 400 jobs lost at its operations in London and Bicester in Oxfordshire.
The crisis has also delayed the stepping up of production of its electric vans. It had forecast that it would build up to 600 vans this year but with its first microfactory in Bicester yet to go live, that has been pared back to deliveries by the end of this year of just 20.
Avinash Rugoobur, 41, Arrival’s executive director, said: “It is prudent to manage our [cash] burn to ride through the turbulence and wait for capital markets to recover.”
Prototypes of its bus have received regulatory clearance and are operating on roads, shuttling staff between its Banbury and Bicester sites. Rugoobur said the decision to pause development of the bus meant Arrival could concentrate on getting the Bicester microfactory up and running and capable of producing 10,000 vans a year. It will then turn its focus to replicating that low-cost microfactory, typically costing £50 million to set up, with a similar facility to build vans in Charlotte, North Carolina, for the American market.
The delay in production comes as competition to deliver such vehicles hots up. Of Go-Ahead Group’s 5,000 buses, 300 are now electric, coming from Chinese manufacturers such as BYD and Yutong. Stagecoach is taking electric buses from Alexander Dennis. Wrightbus, which is building buses in Northern Ireland, is making hydrogen vehicles.
Rugoobur denied that Sverdlov’s previous role as a minister a decade ago in the government of President Putin was putting off investors or customers. “He has been open and transparent and the [UK] government and the US have cleared us,” he said.
After the Russian invasion of Ukraine, Sverdlov, Arrival’s chief executive, said: “ I’m strongly against war or discrimination of any kind. I was born in Georgia and worked in Russia. My wife, three kids and I left Russia in 2013 before [the Russian invasion of] Crimea and I was shocked at that time . . . I have no connection to the Russian government in any form.”
The van’s are really cool, and the buses seem viable as a product.
https://www.youtube.com/watch?v=7dYtrncuQpU
I was always doubtful about the ‘micro-factory’ concept though. The future seems to be in the other direction – massive giga-factories churning out millions of identical vehicles as fast as possible through innovative design and automation.
Hopefully someone will swoop in and pick up the IP and keep them in production.
Funny they were the UK’s most valuable company briefly in 2021
https://www.thisismoney.co.uk/money/markets/article-9406137/Arrival-largest-listing-British-company-13-6bn-valuation.html