Executive Summary

ELMS affirmed start of production for Urban Delivery by end of Q3 2021 and set a 2021 production target of 1,000 units, positioning as the first Class 1 commercial EV in the U.S. market; partnerships (Randy Marion, Cox Automotive, Thermo King) and the Mishawaka plant acquisition strengthen go-to-market readiness .
Q2 2021 results reflect pre-revenue ramp: net loss $8.59M and basic/diluted EPS of $(0.10); operating expenses were $7.47M (R&D $2.41M, G&A $5.06M) .
Liquidity is robust with $217.4M in total cash and restricted cash (cash $171.5M, restricted cash $45.9M) at quarter-end to fund commercialization and capex .
2021 guidance introduced/updated: operating expenses $75–$80M and capex $25–$30M; gross margin outlook reduced to low single digits near-term due to supply chain/logistics constraints, with potential MSRP increases to offset costs .
Stock-reaction catalysts: confirmation of Q3 SOP and first-mover Class 1 EV status, plus distribution/service partnerships; risks include supply chain frictions and internal control material weaknesses disclosed in Q2 10-Q .

What Went Well and What Went Wrong

What Went Well

“We are affirming our intentions to launch production…by the end of the third quarter” and “we are now actively working to finalize order commitments” (CEO James Taylor) .
Closed business combination raising approximately $294M and acquired the Mishawaka EV manufacturing facility with up to 100,000-unit capacity, accelerating scale-up .
Strategic partnerships: proposed distribution with Randy Marion; collaboration with Cox Automotive (6,000+ service centers) and Dickinson Fleet Services (800+ mobile technicians); prototype with Thermo King for all-electric refrigerated delivery vehicle .

What Went Wrong

2021 production target updated to ~1,000 units, lowered from the original business plan due to delayed business combination closing, COVID-related supply chain issues, and cargo container/logistics constraints; near-term gross margins guided to low single digits .
Internal controls: management identified material weaknesses related to accounting for complex transactions and IT general controls; disclosure controls deemed not effective as of Q2 .
Ongoing supply chain risk concentration (SERES/Sokon/Wuling contracts) and potential pricing changes; management noted possible MSRP increases to recoup rising costs .

Financial Results

Metric	Q2 2020 (Predecessor)	Q1 2021 (Successor)	Q2 2021 (Successor)
Revenues ($USD Millions)	$0.00 (pre-revenue)	$0.00 (pre-revenue)	$0.00 (pre-revenue)
Research & Development ($USD Millions)	$0.00	$0.33 (6M minus Q2: $2.739–$2.410)	$2.41
General & Administrative ($USD Millions)	$1.77	$2.79 (6M minus Q2: $7.854–$5.060)	$5.06
Total Operating Expenses ($USD Millions)	$1.77	$3.12 (calc)	$7.47
Net Loss ($USD Millions)	$(1.77)	$(3.53) (6M minus Q2: $12.114–$8.586)	$(8.59)
Basic & Diluted EPS ($USD)	N/A (predecessor carve-out)	N/A (not disclosed quarterly)	$(0.10)
Gain on Change in Fair Value of Warrants ($USD Millions)	N/A	N/A	$0.95
Cash & Equivalents ($USD Millions)	$25.21 (12/31/20)	N/A	$171.53
Restricted Cash ($USD Millions)	$0.00 (12/31/20)	N/A	$45.90
Total Cash + Restricted ($USD Millions)	$25.21 (12/31/20)	N/A	$217.43

Notes:

Predecessor vs Successor periods are not comparable; ELMS was pre-revenue in Q2 2021 and focused on commercialization ramp .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Urban Delivery Start of Production	Q3 2021	Targeted Q3 2021 SOP (prior messaging)	Affirmed SOP by end of Q3 2021	Maintained
2021 Production Volume (Units)	FY 2021	Not disclosed in filings; higher plan implied	Updated to ~1,000 units	Lowered/Updated
Total Operating Expenses ($USD Millions)	FY 2021	Not provided previously	$75–$80	Initiated
Capital Expenditures ($USD Millions)	FY 2021	Not provided previously	$25–$30	Initiated
Gross Margin Outlook	H2 2021	Prior plan higher margins	Low single digits near term due to supply chain/logistics	Lowered
2022 Volume Target	FY 2022	As per business plan	On track (no numeric disclosed)	Maintained directional

Drivers: Delay in business combination closing and industry-wide supply chain/logistics constraints (e.g., cargo container availability) led to 2021 volume/margin adjustments; potential MSRP increases considered to recoup cost inflation .

Earnings Call Themes & Trends

Note: No Q2 2021 earnings call transcript was available in the document system after targeted searches (earnings-call-transcript for ELMSQ) during the Q2 window; analysis below draws from the Q2 press release and 10-Q MD&A .

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q2 2021)	Trend
Supply chain/logistics	Limited prior public disclosures; SPAC stage in Q1	Constraints (COVID-19, cargo containers) drove updated 2021 volume and lowered near-term margins; potential MSRP increases	Negative pressure; mitigation via pricing
Product launch/SOP	Prior aim for Q3 SOP	SOP affirmed for end of Q3 2021; pilots scheduled; Urban Utility targeted for H2 2022	On track; confidence reiterated
Partnerships/Distribution/Service	Emerging in prior materials	Randy Marion distribution; Cox/Dickinson service network; Thermo King refrigerated EV prototype	Building ecosystem
Regulatory/legal & internal controls	Not highlighted earlier	Material weaknesses in internal controls; groundwater chromium investigation pending with IDEM/USEPA	Heightened risk awareness
Manufacturing footprint	Mishawaka plant acquisition	Facility acquired; PP&E $192.0M gross; capex planned to support SOP	Scale-up progressing

Management Commentary

“We are affirming our intentions to launch production of the U.S. market’s first Class 1 commercial EV, the Urban Delivery, by the end of the third quarter” (James Taylor, CEO) .
“Reception of the Urban Delivery has been positive, and we are now actively working to finalize order commitments… pilots for our EVs, including our second product, the all-electric medium duty Urban Utility” .
Business outlook emphasized 2021 SOP, 1,000-unit target, and being “on track for 2022 production volume target” .
Strategic positioning: “well-positioned to seize a first-mover opportunity in the Class 1 commercial EV segment at scale” .

Q&A Highlights

No Q2 2021 earnings call transcript was available in the document system; management’s written disclosures clarified:

Near-term margin compression and 2021 volume update due to supply chain/logistics; potential MSRP adjustments to offset input-cost inflation .
Liquidity and funding sufficiency post-business combination to execute plan (cash + restricted cash $217.4M) .
Ecosystem build-out via distribution/service partnerships to support commercial launch .

Estimates Context

Wall Street consensus (S&P Global/Capital IQ) for Q2 2021 EPS/revenue was unavailable due to missing SPGI/CIQ mapping for ELMSQ, so we cannot assess beats/misses versus consensus. Values retrieved from S&P Global were unavailable.

Where estimates may need to adjust:

2021 production lowered to ~1,000 units and gross margin guided to low single digits could prompt downward revisions to near-term profitability expectations; SOP affirmation and ecosystem partnerships support 2022 volume trajectory .

Key Takeaways for Investors

Execution catalyst: Q3 2021 SOP for Urban Delivery; first-mover status in Class 1 commercial EV is a potential narrative driver into launch .
Near-term earnings profile: pre-revenue ramp, low-single-digit gross margin guidance, and updated 2021 volume (~1,000 units) imply limited 2021 profitability; monitor MSRP actions and supply chain normalization .
Liquidity runway: $217.4M total cash/restricted cash supports capex ($25–$30M) and 2021 opex ($75–$80M) without external raise in the near term .
Ecosystem readiness: distribution and service partnerships (Randy Marion, Cox/Dickinson) de-risk commercialization and fleet support at scale .
Risk factors: internal control material weaknesses; supplier concentration and IP/license dependencies (SERES/Sokon/Wuling); environmental investigation at Mishawaka; monitor governance and operational remediation .
Medium-term thesis: If SOP holds and supply chain pressures ease, 2022 volume trajectory could reset expectations upward; watch conversion of order interest into binding commitments and margin progression .
Trading lens: Near-term stock moves likely tied to SOP timing confirmations, production ramp updates, and additional fleet/customer wins; risk-off on further supply chain setbacks or control remediation slippage .

Additional Data (Balance Sheet/Operational KPIs)

KPI	Dec 31, 2020	Jun 30, 2021
Cash and Cash Equivalents ($USD Millions)	$25.21	$171.53
Restricted Cash ($USD Millions)	$0.00	$45.90
Total Cash + Restricted ($USD Millions)	$25.21	$217.43
PP&E, Net ($USD Millions)	$131.91 (Predecessor)	$191.97 (Successor)
Inventories ($USD Millions)	$0.00 (12/31/20)	$0.82 (battery components)
Warrant Liabilities ($USD Millions)	$0.00 (12/31/20)	$19.45
Land Contract + Promissory Note (Carrying Value, $USD Millions)	$0.00 (12/31/20)	$109.37
Warrants Outstanding (Count)	N/A	8,580,375

Operational Notes:

SERES asset purchase consideration totaled ~$197.6M including cash, notes, IP license, and stock issuance; Mishawaka plant PP&E dominates fixed asset base .
Subsequent event: Wuling contracts signed July 2021 with initial $4M retainer paid for engineering services .

Search notes:

Read in full: Q2 2021 8-K with Exhibit 99.1 press release .
Read in full: Q2 2021 10-Q for financials/MD&A –.
Q2 2021 earnings call transcript was not found in the system despite targeted searches; press-release-only details used for qualitative themes [SearchDocuments attempt returned no ELMSQ transcript].
Prior quarter (Q1 2021) filing relates to SPAC stage (Forum Merger III), not comparable operating results; Q2 10-Q provides Successor six-month and Q2-only data used for trend analysis .

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