Arrival

Hello everyone and welcome to Arrival's third quarter 2022 earnings webinar. My name is Mike and I'll be your operator today. Before I hand the call over to the Arrival team, I'd like to go over just a few housekeeping notes for the program. As a reminder, this webinar is being recorded. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, please use the raise hand function at the bottom of your screen. If you plan to ask a question, please ensure that you've set your Zoom name to display your full name and firm. Thank you for your attendance today, and I will now turn the call over to Arrival.

Thank you all for joining us today to discuss Arrival's third quarter 2022 financial results and business update. Today we have Dennis Skrdloff, Arrival founder and CEO, Avinash Ruggabur, President, John Wozniak, CFO, and Mike Eagleson, CEO of North America. Before we begin, I'd like to remind everyone that certain statements made on this call today are forward-looking statements. These statements are subject to various risks and uncertainties and reflect our current expectations based on our beliefs, assumptions, and the information currently available to us. Although we believe these expectations are reasonable, we undertake no obligation to revise any statements to reflect changes that occur after this call. Descriptions of these factors and other risks that could cause actual results to differ materially from these forward-looking statements are discussed in more detail in our filings of the SEC and our third quarter 2022 business update issued today on the 8th of November. During the call, we also refer to certain non-IFRS financial measures. This should be considered in addition to and not as a substitute for or in isolation from our IFRS results. For further information, please refer to our investor relations website at investors.arrival.com. With that in mind, I'll turn it over to Avinash.

Thanks, Annie. 2022 has been a difficult year for the entire sector, and Arrival is no exception. But Arrival is unique in how we respond to these challenges. We recently announced a modification in our current focus and I want to explain this today and remind everyone why it is that Arrival has such great potential. Over the last eight years, we have developed a new method to design and produce any type of electric vehicle enabled by a vertically integrated stack of technologies. We have IP that no one else before us has been able to develop in this industry, which consists of proprietary composite body parts, high voltage and low voltage components, software for vehicles, autonomous mobile robotics, and software-defined microfactories. The benefit of these technologies is that they are designed for microfactory assembly, and we can use the same core technologies in all our vehicle programs. We certified our bus and van products in Europe, We were able to do this in rapid time due to our vertical integration. These are learnings and capabilities we will carry forward in all our vehicle programs. We recommenced road trials with customers. Real-world testing allows us to fine-tune our technologies. We also assembled our first production verification vans in Bistra this year using our unique method of assembly. And this shows that the Microfactory has moved from a concept to a reality. And we've done all of this with approximately $1.6 billion of investment, which highlights the relative capital efficiency of our business model. At the end of Q3, we had approximately $330 million of cash and cash equivalents on hand, which is not enough capital to ramp up volume production of the LVAN in Vista. In our Q2 financial results, we announced plans to use existing cash on hand of $513 million plus funds available through a $300 million at-the-market ATM platform to deliver the first vehicles to UK customers this year, invest in hard tooling, and launch the Charlotte Microfactory next year. Due to the current market cap and average daily trading volumes, the ATM has not allowed us to raise the capital to do what we need to do in the timeframe we want to do it. And we were later than expected in delivering upon some of our key objectives. At the same time, the introduction of the Inflation Reduction Act tax credits, ranging from $7,500 up to $40,000 for commercial electric vehicles, the large market size, plus the anticipated higher margins for commercial vehicles, made the US our most attractive market. Our long-term strategy and opportunity remains the same, but the combined effects of these points means that we have had to adjust our short-term strategy. To survive in these market conditions requires this kind of agility. For these reasons, to ensure the ongoing success of Arrival, we don't have any other choice than to move to the next stage of our strategy, which has always been to bring products to the U.S. market. Therefore, our focus over the next couple of quarters is to extend the runway of our cash on hand by restructuring the business to reduce costs. to continue to advance our enabling technologies as every improvement here is shared by all our vehicles, to produce a small number of vans in Vista to optimize microfactory assembly processes, perform durability testing on our vehicles and continue customer trials, and to secure new funds to bring our products to the U.S. Our U.S.-based product engineering team will be led by Mike Ibleson, who brings over 30 years of experience with GM, including leading vehicle programs. We have learned a tremendous amount in designing the arrival bus, van, and car from the ground up using our own vertically integrated technologies. And our U.S. products will reuse much of this intel. The talented team we have in place gives us renewed confidence in our ability to execute as well. Finally, I want to add, this does not mean we are writing off the UK and European markets. Put simply, we are prioritising the US market with our current available funds, but we will keep an incredible team in place in the UK to redesign and optimise aspects of our URBAN for the new EU regulations. And with that, I'll hand it over to John for our financial results and cash guidance.