This week, we go airborne with the Workhorse Horsefly drone, consider a high-flying SPAC for a vertical-takeoff-and-landing jet maker and dive deeper into Cummins’ deal to make medium-duty engines for Daimler Truck.
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Gonna fly now
So much has been made of Workhorse Group’s losing out on the U.S. Postal Service contract for next-generation mail trucks that it was easy to overlook the update on the company’s truck-mounted drone delivery system.
While Workhorse has a lot to prove in manufacturing — it’s gotta make more than seven trucks every three months — the company has an efficiency multiplier with the Horsefly.
Workhorse is perfecting its unmanned aerial system in a joint venture with Moog Corp. (NYSE: MOG.A), a maker of motion-control products for aerospace, defense, industrial and medical applications. Horsefly can autonomously depart from and return to a C-Series electric delivery truck. Or it can be launched from a rooftop or a parking lot.
The Horsefly carries up to a 10-pound payload and can do its thing up to five miles from the truck while a delivery driver tends to traditional business. Horsefly delivered thousands of packages in Virginia during tests with United Parcel Service (NYSE: UPS) last year. Workhorse has delivered two C-Series trucks to UPS with converted rooftops to accommodate the drones.
Like other drone makers eager to fly, Workhorse is awaiting type certification from the Federal Aviation Administration. Type certification means the aircraft design and components comply with federal noise, exhaust and other standards. That is probably 18 months away.
“In 2020, we created the conditions for providing safe, reliable aerial package delivery. In 2021, we’ll start actually doing it in-service to the public,” CEO Duane Hughes said Monday.
Meet George Jetson
When Qell Acquisition Corp. (NASDAQ: QELL) talked last fall about finding an advanced mobility target for its blank check investors, special purpose acquisition companies (SPACs) were rapidly inking deals with electric car and infrastructure startups. With few of those targets remaining, Qell could be rising above the fray — literally.
Bloomberg reported Wednesday that the SPAC run by former General Motors Co. executive Barry Engle is in talks to merge with Lilium, a German startup that’s making an all-electric vertical takeoff and landing passenger jet. Qell is trying to raise enough money beyond the $380 million from its initial public offering last August to get a $2 billion valuation for Lilium.
Lilium expects its jets to be available around the world around 2025.
How many engines did you say?
When Cummins Inc. (NYSE: CMI) and Daimler Truck announced that the Columbus, Indiana-based engine maker would produce all medium-duty engines for the soon-to-be independent truck maker, the scope of the deal was missing.
Now we know. Daimler makes about 100,000 medium-duty engines a year, Srikanth Padmanabhan, the president of Cummins’ engine business, told a Raymond James investor conference on Monday.
It is a big deal. Cummins did not have to file anything with the Securities and Exchange Commission since it is still an understanding, rather than a contract, between the companies that have worked together for 80 years.
The first 10,000 engines Cummins will make with Daimler’s Mannheim complex near Frankfurt, Germany, will be headed to the U.S. around 2024. Another 30,000 follow for Europe. Brazil gets 45,000. Japan gets 2,000 and the rest of the world gets the rest.
Are similar, if smaller, deals in the offing for Cummins? Padmanabhan thinks so.
Over the air
Volvo Trucks North America (VTNA) and Mack Trucks already let drivers and fleet operators decide when to activate over-the-air (OTA) parameter changes to their trucks. Now the Volvo Group siblings are removing the caps on how often those changes can be made. Unlimited updates are free for the first two years of ownership. They can be extended by subscription after that.
Done deal
The Daimler Truck AG and Volvo Group fuel cell-making joint venture is a done deal. Volvo paid about $719 million for 50% of Daimler Truck Fuel Cell GmbH & Co. The new name for the venture is cell-centric GmbH & Co. KG.
Look for customer tests of fuel cell trucks in about three years. Production would come in the second half of the decade. The Mercedes-Benz GenH2 Truck (below) is one product planned for later in the decade. But with Daimler Truck soon to be a stand-alone company, the name likely will change by the time it arrives.
Juicing the business
Add another piece to Dana Inc.’s (NYSE: DAN) growing electrification portfolio. Dana converted its noncontrolling interest in Pi Innovo acquired last October to full ownership. Pi Innovo makes embedded software and electronic control units for light, commercial and off-highway markets. Terms were undisclosed.
Parts is parts
PACCAR Inc. (NASDAQ: PCAR) recognized 369 suppliers in 27 countries on five continents for exceeding its “10 ppm” quality standard. That means delivering no more than 10 defective parts for every 1 million parts shipped.
Getting to know you, and you, and you…
If the analyst community doesn’t know much about Hyzon Motors yet, it sure will a month from now. The commercial fuel cell maker will participate in five virtual events between March 10 and 29.
Hyzon is rapidly expanding following a SPAC merger with Decarbonization Plus Acquisition Corp. (NASDAQ: DCRB). Hyzon should get $570 million when the business combination closes next quarter.
Come together
If we continue making progress against the global coronavirus pandemic, one of the industry’s bigger get-togethers is ready to fling open the doors of the Georgia World Congress Center in Atlanta. The biennial North American Commercial Vehicle (NACV) Show is scheduled for Sept. 28-30.
That’s it for this week. Thanks for reading.
Alan