Workhorse Group Inc. (NASDAQ: WKHS) can sell its zero-emission C-Series electric delivery vans in all 50 states after a California ruling buttressed a federal finding in the company’s favor.
Now, Workhorse just has to build the vans.
The Cincinnati-based manufacturer is building a couple of trucks a day at its Union City, Indiana plant. The goal is 300 to 400 vans this year. United Parcel Service (NYSE: UPS) and DHL have placed orders for about 1,100 vans.
The California Air Resources Board (CARB) issued an executive order to Workhorse valid for an unspecified year. CARB’s website does not show the order yet. Workhorse’s previous E-Series electric van received a certification for 2018.
Workhorse stopped making the E-Series vans to focus on developing the composite-body C-Series vans with cargo capacities of 400 to 1,200 cubic feet. Initially, it is making 650- and 1,000-cubic-foot vans.
Monday’s news drove Workhorse shares higher. They are up 600% over the last 90 days. Most public electric truck makers’ shares are surging, led by Tesla Inc. (NASDAQ: TSLA), which was up more than 7% at $1,664 in midday trading.
Incentivized sales ahead
The executive order from CARB eases Workhorse’s inclusion in California’s Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (HVIP). The state uses proceeds from Cap and Trade fines to incentivize buyers of near-zero and zero-emission vehicles (ZEVs). Since 2009, California has issued 3,165 vouchers worth nearly $366 million for ZEVs.
Workhorse received a certificate of conformity from the U.S. Environmental Protection Agency (EPA) in March. The CARB order is important because California and 13 other states require more than just EPA compliance for vehicles to be sold in those states.
“Obtaining this Executive Order from CARB is another milestone achievement for Workhorse and for the electric vehicle industry at large,” CEO Duane Hughes said, adding that he expects HVIP to be “ a major growth stimulus as more voucher funds become available in the future.”
CARB’s recent Advanced Clean Truck regulation for the first time requires commercial vehicle manufacturers to meet quotas for selling electric vehicles, beginning at 9% in 2024 and moving to exclusively electric trucks by 2045.
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