SES AI - Q3 2023
November 7, 2023
Transcript
Operator (participant)
Hello, everyone, and welcome to the SES AI Corporation third quarter earnings conference call. My name is Bruno, and I'll be operating your call today. During the presentation, you can register to ask a question by pressing star followed by one on your telephone keypad. I will now hand over to your host, Eric Goldstein, Vice President of Investor Relations. Please go ahead.
Eric Goldstein (VP of Investor Relations)
Thank you, operator. Hello, everyone, and welcome to our conference call covering our third quarter 2023 results and financial guidance for 2023. Joining me today are Qichao Hu, Founder and Chief Executive Officer, and Jing Nealis, Chief Financial Officer. We issued our shareholder letter earlier this morning, which provides a business update as well as our financial results. You'll find a press release with a link to our shareholder letter in today's conference call webcast in the Investor Relations section of our website at ses.ai. Before we get started, this is a reminder that the discussion today may contain forward-looking information or forward-looking statements within the meaning of applicable securities legislation. These statements are based on our predictions and expectations as of today.
Such statements involve certain risks, assumptions, and uncertainties, which may cause our actual or future results and performance to be materially different from those expressed or implied in these statements. The risks and uncertainties that could cause our results to differ materially from our current expectations include, but are not limited to, those detailed in our latest earnings release and in our SEC filings. This morning, we will review our business as well as results for the quarter. With that, I will pass it over to Qichao.
Qichao Hu (Founder and CEO)
Thanks, Eric. Earlier this year, we laid out the goal to transition to B-samples, and I'm happy to report we're almost there. We expect to sign a B-sample joint development agreement, JDA, with one of our OEM customers in the next few weeks. This will be the world's first automotive B-sample for lithium metal. This will be a historic milestone for SES, for the battery industry, and for the future of transportation. We had to overcome monumental challenges to get to this point. One of the most important challenges was safety, and we're not talking about lab-scale safety. We are talking about practical, real-world safety. In the battery industry, there's an inherent trade-off between energy density and safety. Many companies improve safety by using safer chemistries, such as lithium iron phosphate, LFP cathodes, or solid-state electrolytes.
LFP is indeed safer than high nickel cathodes, and in theory, solid state appears to be less volatile than liquid lithium metal. So why don't we switch to these safer chemistries? While these safer chemistries appear to improve safety, we believe they make unacceptable compromises to energy density, manufacturability, and other important parameters. For example, an LFP cathode has about half the energy density of a high nickel cathode, and solid state has yet to prove its manufacturability and performance in a cell that can actually be used in a real-world application. So what's the point? We don't want our cells to be impractical, but safe. We want our cells to be alive, powerful, and safe. Our goal all along has been to improve safety without any compromises to other parameters.
We start with a high energy density approach that has inherently higher safety risk than a lower energy density solution, and we make it safe. It's extremely difficult, but we have always chosen to do things the hard way. That is what we will have achieved to qualify for automotive B-sample for lithium-metal. No one thought lithium-metal with a high nickel cathode would achieve the level of practical safety that we recently demonstrated in our internal testing. This was a culmination of very exciting fundamental breakthroughs in materials and engineering. Even advanced lithium-ion with a high nickel cathode can have severe safety risks, and we believe our advancements address the safety issues in both lithium-ion and lithium-metal. For example, our new high nickel cathode active materials have the same capacity as equivalent traditional high nickel cathodes, but are much more stable.
Our new cathode electrode coating and treatment process allows the same cathode to pass rigorous safety tests, including nail penetration and heating, a new pouch cell engineering with a self-venting mechanism that allows gradual, safe release of energy during thermal runaway, a new electrolyte that is safer with no compromise on performance, a new protected lithium metal anode, and a new charging protocol that improves overall safety. These are fundamental breakthroughs in both engineering and materials, not just for lithium metal, but also for lithium ion, especially our developments in the cathodes... We are now able to delay the thermal runaway onset temperature and reduce peak temperature and pressure during thermal runaway significantly. Some companies that are in earlier stage of lithium metal development talk about dreams of perfectly safe batteries. In most cases, the battery capacity or energy density is so low that it's useless.
To be in automotive B-sample, which we believe is the most advanced in lithium metal development anywhere in the world, we deal with practical safety concerns, not dreams on paper. It's exhilarating to see our batteries during safety tests, going from big explosions to small explosions, to big fires, to small fires, to just smoke. It feels like witnessing a successful rocket launch after many failures. We recently completed our second testing bunker. Now we have even greater resource to test new things. For many people, risk means danger and should be avoided. For us, risk means innovation, and we embrace risk by creating a safe environment to test unsafe things. Without these bunkers, without this safe environment to test unsafe things, we will not be able to understand the mechanism.
We will not be able to make unsafe things safe, and next generation batteries and transportation will not be able to move forward. At our upcoming Battery World 2023 in December, we will demonstrate some exciting videos of high-energy density lithium metal batteries passing very rigorous safety tests. We never thought we could achieve such safety while maintaining high-energy density. This is a big milestone towards our goal of commercializing large capacity, high-energy density lithium metal cells for automotive applications. In terms of manufacturability, last quarter, we indicated we will increase our A-sample lines to 1,000 large capacity, 100 amp hour cells per line per month, from approximately 500 per month. November will be the first month that we will attempt to build 1,000 A-sample, 100 amp hour cells at our Chungju line in Korea.
These cells will be used for both internal testing and OEM sample qualification, and Avatar safety prediction algorithm training. We currently have three A-sample lines in operation and two B-sample lines under preparation: one line for an EV application and one for a UAM application. For the two B-sample lines, we are in the final stages of completing our vendor qualification review. We expect to continue to use the A-sample lines for B-sample cell development until the new B-sample lines become operational, which we expect to occur in 2024. By running our lines up to 1,000 large, 100 amp-hour cells per month, we will also gain valuable experience in Avatar cell traceability and quality system development. We have even hired a dedicated field data collection team to help ensure that the data are correct and collected through the correct process.
This team helps our Avatar algorithm safety prediction tremendously by providing verifiable and complete data. In summary, earlier this year, we established a milestone to transition to B-sample, and we are almost there. This is a major milestone for us and for the battery and transportation industry, and it's a result of solid, fundamental, hardcore material chemistry and cell engineering breakthroughs in safety for high-energy density lithium metal batteries with a high nickel cathode. From A-sample to B-sample JDAs with EV OEMs, the most important value of these JDAs is helping us build a solid foundation in technology development, process development, engineering development, quality development, and manufacturing development. With this solid foundation, we're now able to expand into other applications that are ideal for our unique high-energy density and high power density lithium metal batteries, such as drones and urban air mobility, UAM.
These applications also represent early-stage commercialization opportunities for us. We are very excited about the UAM opportunity and believe that lithium metal will enable UAM in the 2020s, the same way that lithium-ion enabled portable consumer electronics thirty years ago in the 1990s. The world's first lithium metal B-sample will be a small step for SES, but has the potential to be a giant milestone for the future of sustainable transportation, both on land and in air. Now I'll hand the call over to Jing Nealis.
Jing Nealis (CFO)
Thank you, Qichao. Good afternoon, everyone. Today, I will cover our third quarter financial results and discuss our operating and capital budgets for full year 2023. In the third quarter, our operating expenses were $19.4 million, down slightly from the same period last year. Stock-based compensation expense was $2.4 million in the quarter. We reported research and development expenses of $8.5 million, up $0.1 million from the same period last year. Our gross R&D spending in the third quarter was $11.4 million, which includes $2.9 million that was billed to our OEM customers and is treated as contra R&D expense.... Our G&A expenses were $10.9 million, down $2.4 million from the same period last year. This decline was primarily driven by lower insurance premiums and lower marketing, accounting, and audit-related expenses.
Through the first nine months of 2023, cash used in operations was $43.9 million, and capital expenditures were $12.3 million. Importantly, our balance sheet remains very strong. We ended the third quarter with combined cash, cash equivalents, and marketable securities of $342 million. We continue to believe our liquidity is sufficient to reach commercialization. Our updated guidance for cash usage in 2023 is now $85 million-$105 million. This is comprised of cash usage from operations of $65 million-$75 million, and for capital expenditures in the range of $20 million-$30 million. We continue to be very prudent with our cash.
We have a very practical process to evaluate where we should spend our cash in order to execute on our business plan and drive our commercialization roadmap forward, while we keep investing in core material innovation, with the goal to always stay ahead of the competition. As Qichao mentioned, we're in the final stages of completing our vendor qualification review for line 4 and line 5 in preparation for B-sample. We expect the bulk of our capital expenditures for line 4 and line 5 to fall in the first half of calendar year 2024. We're making significant progress and remain on track for transition to B-samples by the end of this year.
Our strong liquidity position allows us to continue investing in our next-generation manufacturing lines to support our OEM customers, while continuing to innovate at the forefront of battery material science and to attract and retain top talent. We are very thankful for all the support we have received from our OEM customers and shareholders. With that, I'll hand the call back to Eric.
Eric Goldstein (VP of Investor Relations)
Thanks, Jing. Bruno, let's open the line for questions.
Operator (participant)
Perfect. Thank you. Ladies and gentlemen, if you'd like to ask a question, please press star one on your telephone keypad. That's star one on your telephone keypad. To withdraw the question, star followed by two, and please also remember to unmute your microphone when it's your turn to- Our first question comes from Winnie Dong from DB. Winnie, your line is now open. Please go ahead.
Winnie Dong (Research Analyst)
Yes, thank you so much for taking my question. I was wondering if you can describe sort of how the next month of work will look like in the context of, in the context of, transitioning to, to B-sample. You know, what are some of the, the key, you know, data points or transitions to look for within the next few months, heading into 2024 as you're preparing line four and five? Thanks.
Qichao Hu (Founder and CEO)
Yeah, that's a good question. So, from a contractual perspective, basically, we're going through the the standard legal and the financial process to getting the document signed. And then from a practical work perspective, so one key thing that we have demonstrated is safety, Hazard Level five. And then we've already demonstrated Hazard Level five at a small cell level, and then in the next few months, we need to further verify Hazard Level five at larger cell level. So the safety is a key thing. And then A-sample was really about demonstrating the chemistry and the cell design, and then now B-sample. In B-sample, we are going to build about 5-10 cars worth of batteries. So now safety and then practical safety actually becomes really important.
So they wanna see very detailed testing under very detailed testing parameters, and then both at the small cell level and also the large cell capacity level. We are also in the process of completing a vendor qualification so that we can start building the line for B-sample. The B-sample will likely take about a year to a year and a half, so complete by end of 2024 to mid-2025.
Winnie Dong (Research Analyst)
Got it. And then earlier on this year, I think you guys have spoken about, you know, talent acquisition as one of the key initiatives this year. I was wondering, like-
Qichao Hu (Founder and CEO)
Yes
Winnie Dong (Research Analyst)
... with the year almost ending, are you where you hope to be or need to be with your sort of, like, talent acquisition?
Qichao Hu (Founder and CEO)
Yeah. Yes, so talent, I mean, we always want more and better, and we're never satisfied with talent acquisition, and the market is very competitive, which is a good thing. I mean, it's a really exciting market. And then, you can probably tell that the kind of people that we're trying to hire, battery engineers, material scientists, AI scientists, these are very much in demand, almost around the world. I'm sure we can always do better. But actually recently, we actually made some pretty impressive hires. For example, on the material science side, we hire our Chief Scientist, Kang Xu. He's one of the world's most renowned experts in battery electrolyte.
And also, on the cell engineering side, we also hired. We also made a few hires recently, and these guys have extensive experience from the big Korean battery companies. So actually recently, we made quite a bit of progress, and that allows us to beef up our team for the B-sample and also to expand to eVTOL. So in the past, we had three teams for the three A-samples, and now we're going to keep beefing up our team to go from A to B and also expand into eVTOL. So we're making good progress, but never enough.
Winnie Dong (Research Analyst)
Thanks for that. And then maybe a more high-level question, just in the context of, like recent narratives around EV adoption curves, that may be, you know, not coming as strong as expected. You sort of hear that from suppliers, and you hear that from OEMs. Understanding that you guys are sort of in the product development phase, but do you hear any of this from your, any of your JDA partners, in terms of, you know, the adoption curve looking for not coming in as strong, or you can color, any color you can add there? Thanks.
Qichao Hu (Founder and CEO)
Yeah, I think, I mean, the adoption curve can always be impacted by, for example, the economy and the other factors. But the overall trend, that's unstoppable. And then, especially these OEMs, like GM and Honda, which I would say are behind the newcomers like the Tesla and NIO, they are very much committed to EV adoption. So, there might be some impacts by the economy and other factors, but in terms of the battery roadmaps, no change there.
Winnie Dong (Research Analyst)
Thank you so much, Alfonso.
Qichao Hu (Founder and CEO)
Thank you.
Operator (participant)
Our next question comes from Sean Severson from Water Tower Research. Sean, the line is now open. Please go ahead.
Shawn Severson (Co-Founder & President, Head of ClimateTech and Sustainable Investing Research)
Great. Thank you. Good morning, everyone. Qichao, I was wondering if you could talk a little bit about the air mobility space, and I, and I'm trying to understand, I guess, lack of a better word, the synergies between the, you know, the automotive and transportation side and what you're doing in air mobility, and, and then extending from that, a little bit of the timeline of what we'd be looking at in, in the, urban air mobility space?
Qichao Hu (Founder and CEO)
Yes, Sean, that's a really interesting question. So all the work that we are doing with the EV OEMs in A-sample and in B-sample, building up the line, improving the quality, improving the cell design, the safety, the performance, almost all of that get transferred to the eVTOL, because eVTOLs, the urban air mobility, need all the parameters that the EV OEMs require. The safety, actually, even more rigorous safety requirements, the cell design, the quality, they need all of that. And then what's better is that, for the EV OEMs, you have, I mean, even though the EV OEMs are very committed to lithium metal, you still have the incumbents like LG, CATL, Samsung, SK, the big companies that are very much invested in the EV space.
Whereas for eVTOL, it's blue ocean, and then some of the bigger companies are less interested in the eVTOL because the near-term market, they think the near-term market is smaller. But then for us, for next-gen batteries, it's really exciting. For example, say, so one eVTOL is about two cars in terms of batteries, right? So in the EV B-sample, we build 10 cars worth of batteries. That's just a B-sample for EV. But 10 cars worth of batteries, that's five eVTOLs worth of batteries. If we supply five eVTOLs worth of batteries to the likes of Joby, Archer, the eVTOL companies, then that's actually considered commercial. And the volume is smaller, but then the margin, the economics are much more favorable. And also, it's a new market, so the standards have not been set yet.
Then we have the opportunity, being the, the first mover in lithium metal for eVTOL, we have the opportunity to, to set the standards. Then once you set the standards, then the FAA or Europe, the EASA, then they will adopt the standards. Then our lithium metal could be the first FAA-certified lithium metal battery for UAM. Then once we set the standards, then we influence the next 5, 10 years of, of, certification process in this, in this field. So the impact is, is really big.
Shawn Severson (Co-Founder & President, Head of ClimateTech and Sustainable Investing Research)
That's very interesting. Would you be able to, I assume, through this process, get a lot of data, right? A lot of operating data that would apply back to-
Qichao Hu (Founder and CEO)
Absolutely. Yeah.
Shawn Severson (Co-Founder & President, Head of ClimateTech and Sustainable Investing Research)
Transportation, is that correct?
Qichao Hu (Founder and CEO)
Absolutely. Absolutely. And then, I mean, we love working with the EV companies, but then those companies tend to be bigger, right? And then the eVTOL companies are more entrepreneurial, and they're more like-minded and similar size. And we work together, and we share data, and we also tune our business model to fit what the market wants. So it's actually a really exciting market, and eVTOL is actually happening much faster than we expect. I mean, next year at the Paris Summer Olympics, one eVTOL company will do a demonstration flight, and then several cities around the world are beginning to have these eVTOL demonstrations. So it's actually happening much faster.
Shawn Severson (Co-Founder & President, Head of ClimateTech and Sustainable Investing Research)
Thanks. My last question is: we've had the supply chain shift in place for, you know, several quarters now in terms of pushing towards domestic supply, right, and qualifying for IRA. What's the progress report there? Have you seen things materially change? I know you have some special relationships in your supply chain, but are you seeing that this move is being made, and as far as your strategic outlook, you feel very comfortable that you've got everything that you need at this point going forward?
Qichao Hu (Founder and CEO)
Yeah. Yeah, so, very good point. And then, for example, on the anode side, and then I was just at a conference with Applied Materials. So Applied Materials, Albemarle, Livent, these U.S.-based lithium anode companies are building up plants in the U.S. Some of them are in North Carolina, some are in other states as part of the IRA initiative. And then going forward, we definitely plan to purchase and qualify the anode from U.S.-based vendors. And then also in terms of lithium salt, we are working with a few partners to potentially set up facilities also in the U.S., so we can produce these salt for our high concentration solvent and salt electrolyte. And so the anode and the salt are two really key parameters to us.
Several of our cathode vendors are already setting up plants, for example, in Canada, North America, to supply the cathode. Once we are towards the later stage of B-sample, we will sit down with our EV OEMs and potentially eVTOL OEMs to discuss where in North America to set up a plant for the battery cells.
Shawn Severson (Co-Founder & President, Head of ClimateTech and Sustainable Investing Research)
Great. Thanks for that, Qichao. Congratulations on the progress.
Qichao Hu (Founder and CEO)
Yeah. Thank you, Sean.
Operator (participant)
Our next question comes from Jeff Grampp from Alliance Global Partners. Jeff, your line is now open. Please go ahead.
Jeff Grampp (Senior Analyst, Energy)
Good morning. A question on the transition to B-samples with the auto OEMs. Is there a way to assess, you know, how far behind? It sounds like you have kind of one kind of front runner that you're very close with. Is there a way to assess kind of how far out the other two are relative to this first one? And is having one, you know, assuming you get across the finish line, getting one to B-sample, does that kind of give you guys an ability to nudge the others since there's some third-party validation, or is that not really relevant as you guys have as you guys see OEMs seeing it?
Qichao Hu (Founder and CEO)
Yeah, good question. So actually, the specs to transition from A-sample to B-sample for all the 3 OEMs, and, actually all OEMs around the world, are actually quite similar, the performance and the safety. So, we're gonna transition to B-sample with one of them, because the testing and the type of, studies and testing that we've done is the most extensive. And, I would say the other two, probably in terms of the, the gap, probably can be measured in, in months, just different OEMs, in the past, a year to 2 years during the A-sample development process, we had different timelines because we had different focus, and then for facilities, for line setup.
But the progress is different, but then I would say the overall platform, the core technical progress that we make for safety and performance, that's very transferable. And different OEMs may have different internal processes for getting to the next phase, but I would say they're measured in months. But that's more on the contract level. But in terms of core technical progress, we make progress with one OEM, and then we get to B-sample, and that progress can be transferable to the other OEMs.
Jeff Grampp (Senior Analyst, Energy)
Great. That's, that's very helpful. And for my follow-up, more of a macro question for you guys, but obviously there's been some articles and industry talk about some slowing EV sales and some building of inventories. You know, I think a lot of that relates to cost as well as maybe some range anxiety, which are obviously things you guys can address pretty impactfully. So I'm wondering if you guys are maybe seeing any different level of urgency from your JDA partners to move a solution like yours forward, or is it pretty similar from what you guys have seen historically?
Qichao Hu (Founder and CEO)
Yeah. So the OEMs have sort of modified their focus, for example, from range anxiety to maybe safety to maybe cost. But then in terms of technology platform, the OEMs have not really changed their commitment, because, for example, lithium metal it can mean longer range, but then it can also mean lower cost, because a longer range battery, if you keep the range the same, then the battery is actually smaller, so your pack, the packaging can be actually cheaper. So lithium metal can actually be designed so that it can mean longer range or lower cost to fit the OEM's target.
Jeff Grampp (Senior Analyst, Energy)
Understood. Great. Thank you for the time.
Qichao Hu (Founder and CEO)
Thank you.
Operator (participant)
As a reminder, if you'd like to ask a question, please press star one on your telephone keypad. That's star one on your telephone keypad. Our next question comes from Timothy Johnson. Timothy, please go ahead.
Timothy Johnson (Analyst)
Yes, good morning, and thank you for taking my question. My question concerns the lithium metal anode. There are many processes for making such an anode. They're all problematic to one extent or another. Can you please elaborate a little bit more on the process that you use to lay down your lithium metal anode, and whether or not you have any major problems with this going forward? I'm also interested in the composite coating that you're putting on the lithium metal anode. You mentioned today that you've got a new coating material, and I'm wondering if you can elaborate on that. Thank you very much.
Qichao Hu (Founder and CEO)
Yeah. So I'll try to cover the landscape. The first one, in terms of how to put lithium foil down, as the anode, there's about three main techniques for putting down lithium foil. And then one is extrusion. Basically, you take the thicker lithium foil and then extrude it. It's like a pasta maker, extrude it to a thinner foil, and then you laminate onto your current collector. And then another is physical deposition. Basically, inside the chamber, you evaporate lithium, and then that falls onto your substrate. And then third is slurry coating. You can take the lithium powder, you make a slurry, and then you coat it, and then you dry off the solvent. And there's pros and cons to each of the techniques.
I will say the most mature currently is the extrusion and then lamination. That's by far the most mature process for putting down thin lithium foil. And there are disadvantages to that. For example, it's hard to make the foil wide, but we have an internal process for making the foil wide, and then that's why we're able to make the large format 100 amp-hour lithium-metal cells. So we're using the extrusion and the lamination process for now, but we are actively testing the other two approaches because the other two approaches may offer long-term advantages over the extrusion and lamination process. And for example, maybe in a year to 18 months, we might switch to the other processes, and we'll keep the industry updated.
For us, the different processes basically comes down to which one gives the best metrics in terms of cost, manufacturing efficiency, and performance. And then your second question about composite coating. So the composite coating serves two purposes: one is to improve safety, secondly, to improve the cycle life. And we can't really get into the details of exactly what material we use, and the industry has different types of coatings, and there's different ways and different places in the cell that you can put down the coatings. So, I can't really get into the details, but it's basically used to improve safety and then prevent internal short, and also to improve cycle life.
Operator (participant)
Our next question comes from Bemis Hu from... It's a private investor. Bemis, your line is now open. Please go ahead.
Bemis Hu (Private Investor)
Good morning. Thanks for taking my questions. My question is, so previously you have mentioned that A-sample JDA includes different cathode chemistry in addition to high nickel. Has any progress been made in other chemistry other than high nickel, such as LFP lithium metal?
Qichao Hu (Founder and CEO)
Yeah, so actually, in A-sample, in A-sample, we tested both high nickel, LFP, and also mixtures of those two. And then in B-sample, we will continue to test these different cathodes. And the reason that we do that is now that we're in B-sample, and then we need to finalize the cell design. But the final output of B-sample is basically we have to finalize the cell design, and one of which is what cathodes we're going to use. And then these different cathodes will have different points on the spider chart in terms of safety, cycle life, and cost. And this may vary for the different types of vehicles, even within the same OEM.
Many OEMs will have, for example, the premium brand and the economy brand, and then, of course, they would wish to have one standard unified cell with a unified cathode, but that's not likely. So we are actively testing high nickel, and there's different types of high nickel, LFP, different versions of LFP, and the mixtures of those two. And of course, so there are different ways of mixing those two. And we evaluate, at the end of the day, the performance, energy density, and the overall set of parameters.
Bemis Hu (Private Investor)
During the battery roll, do you plan to share the data on other chemistries other than lithium metal?
Qichao Hu (Founder and CEO)
Well, no. So all the data will be for lithium metal. The cathodes may come from a combination of high nickel and LFP, but they're all lithium metal. We don't make any-
Bemis Hu (Private Investor)
Okay.
Qichao Hu (Founder and CEO)
other cells. We only make lithium metal cells.
Bemis Hu (Private Investor)
Oh, okay. So, related to line 4 and 5, line 4 and five are designed for B-samples. Since eVTOL has a lower volume bar, can line 5 be used for commercialization for eVTOL?
Qichao Hu (Founder and CEO)
Exactly. A very good question, and I think, Sean from Water Tower Research asked the same question. So line four and five are very similar. Line four is for EV, but then it's 10 cars of batteries a year, and that's considered a B sample for EV. Line five, we can make ten cars or five eVTOLs worth of batteries per year, but that's commercial, that's considered commercial, because in EV, no OEM will give you an order for 10 cars, right? But then in eVTOL, a lot of the eVTOL companies will happily give you an order for 3 aircrafts or 5 aircrafts, and these are very high margin, and these help us set the standards in the industry. So yes, line five will be for eVTOL commercial.
Bemis Hu (Private Investor)
So if that's the case, so if that's the case, will there be a C-sample line just for eVTOL, or line five is more like the C-sample and SOP for eVTOL?
Qichao Hu (Founder and CEO)
Yeah. Yeah, so, so eVTOL OEMs don't really divide the phases as clear, as clearly as the EV OEMs. So B, C, SOP are sort of mixed together.
Bemis Hu (Private Investor)
Thanks for your time.
Qichao Hu (Founder and CEO)
Thank you.
Operator (participant)
We currently have no further questions, so I would like to hand the call back to the management team for closing remarks. Over to you.
Qichao Hu (Founder and CEO)
Yeah, so, thanks everyone for tuning in and also supporting us. And, it's not been easy for us to get to this point, and, we're very close to entering B-sample for EV applications. And then all the solid foundation that we've built with EV OEMs, we plan to definitely continue to work with our EV OEMs, and, we continue to have a very good relationship and partnership with them. At the same time, we plan to take this solid foundation that we built, modify it for eVTOL applications. It's a totally new field.
It's a field that's happening much faster than we expected, and it's a field that, like I mentioned earlier, lithium metal, we really believe that in this decade, 2020s, lithium metal is going to enable eVTOL the same way that lithium ion EV enabled consumer electronics 30 years ago in the 1990s. So it's a really exciting field for the future of transportation as well as lithium metal batteries. So really appreciate everyone's support. Thank you.