Dear shareholder of Clean Motion AB.
We can look back on 2021 with a strong sense of comeback.
Despite the pandemic and chaos in much of the of the world economy, we managed to turn our extremely difficult situation around and raise new capital, which means we are now working at full speed towards realizing our vision.
Vision and business concept
We have refined our vision and business concept.
Our new vision is:
“Urban Mobility- charged by the sun”
This vision reflects our overall goal of developing a virtually climate neutral vehicle.
Our business concept is also clarified:
” We offer truly sustainable vehicles for cities, based on energy and resource efficiency, locally produced, to maximize the adoption of electric vehicles globally.”
By producing resource- and energy-efficient vehicles locally, we achieve cost-effectiveness, which means that there is prerequisites for high volumes.
As the vehicles we produce will dramatically reduce climate emissions, it is also important for us to maximize the volumes to ensure that we can make a significant difference.
In essence, it’s the same overall goal we’ve had since the company was founded, but now we managed to describe the idea more clearly.
With Re:volt we have a very strong product concept, which becomes more and more evident as our customers are expressing a strong interest in the vehicle.
We also see a rapidly changing market, where new players are offering completely new services.
Our focused sales effort, has led to many interesting discussions with both new and well-established logistics operators. To date, we have signed six letters of intent, regarding cooperation and pilot projects with Re:volt. That means that the first 50 vehicles are already mortgaged for these projects.
As a lot of of our partners have requested confidentiality. I cannot yet reveal who they are, but they represent a very interesting mix of different urban transport needs, ranging from refrigerated solutions to express deliveries.
The future looks looks good.
We have a good pipeline in place and there is still some room for a few more pilot projects. Our current pilot customers have a combined need for about 3500 vehicles over the next 3 years.
In terms of development, we have made great strides that are broadly in line with our plan. We expect to be able to start production on a limited scale during the last quarter of 2022.
Structural change India
We have previously announced that our intention in India is to transform it into a pure licensing market, i.e. to divest our own company, Zbee India pvt. Ltd.
Conditions in India have been very difficult during the pandemic, but the situation is starting to go back to normal.
Clean Motion’s objectives regarding divestment remains, we will not finance the Indian operations. However, new capital is needed in India to restart the automotive business. The Board has therefore decided to open up to external investors in two stages. In a first smaller round of investment we hope to raise about 200k USD.
I have personally declared myself willing to provide half of the investment. Despite all the historical disappointments of investments in the Indian operations, the market still looks very exciting. The exact terms of the investment will be determined before the end of the month.
The market for electric vehicles.
Interest in electric vehicles continues to grow. Apart from a few exceptions, the global vehicle manufacturers, still develop their vehicles without any major focus on energy efficiency and instead compensating with ever larger batteries.
We are still convinced that energy efficiency will be necessary to achieve sustainable benefits from electric vehicles. The positive thing is that energy efficiency is emphasized and clear signals are finally coming from several directions.
– This week the publication from the Swedish Climate Policy Council’s 2022 report, highlighted energy efficiency as one of the four cornerstones.
– The IPCC released its latest report in the shadow of Ukraine war, but paints a bleaker future than ever, where action must be taken even faster.
– Next week a report from Germany will be released. Research institute DLR entitled:
“The future is electric and light”.
As the headline suggests, vehicle weight is identified as a necessary parameter to create energy efficiency.
Through the EU Green Deal and its proposed “100 Climate Neutral Cities 2030”, there has been 384 applications from cities across Europe. Evaluation and selection is ongoing and the selected cities will be presented in the spring.
I see this as a very interesting market for climate neutral vehicles and we will seek contact with each of these cities as soon as they are selected.
We are talking about 100 cities that will be 100% fossil free. This mega-project will provide a much earlier and clearer signal of the need for change. With this initiative, the EU is a leading role in climate action, even if these 100 cities represent only 2.1% of Europe’s population. By 2050, the whole EU should have achieved the same the same.
The market for sustainable vehicles has developed more slowly than we estimated, but will grow enormously in the coming years. I expect that in the coming months we will be able to invite you to a product demonstration of Re:volt and, in conjunction with that, start taking orders for vehicles for delivery from 2023.