Mullen (MULN) Stock Drops Despite New Air-to-Water EV Tech

  • Mullen Automotive (MULN) has made an exciting new partnership.
  • The electric vehicle (EV) producer is exploring water-to-air technology.
  • MULN stock is down 7% today, but this announcement could boost shares soon.
The Mullen (MULN) Five vehicle is displayed at the 2021 LA Auto Show media day in Los Angeles, November, 18, 2021.
Source: Ringo Chiu / Shutterstock.com

Mullen Automotive (NASDAQ:MULN) isn’t slowing down in its quest to earn a spot at the top of the electric vehicle (EV) race. The company has risen to market prominence as a meme stock without pumping out vehicles like its competitors. That said, Mullen has been working hard to compete with its much larger peers and remind investors why it’s worth watching.

Last week, MULN stock rose on news of a partnership with Team Rosberg Engineering. Now, it just announced another partnership that promises to bring revolutionary new technology to its vehicles. Specifically, Mullen is teaming up with Watergen to introduce “water-from-air solutions” to its EVs.

Watergen is an Israel-based company that has pioneered technology to create water from air. The company says that “the production of drinking water from humidity in the air (AWG) is one of the most important and innovative water extraction solutions available today.” Pending no production complications, Mullen will be the first company to implement this tech as part of a line of EVs. According to a statement, Mullen aims to begin testing Watergen’s technology in its vehicles by the first quarter of 2023.

Let’s take a closer look at what this new partnership could mean for MULN stock and its investors.

The Road Ahead for MULN Stock

Firstly, investors should note that MULN stock is down today irrespective of this news. Broad market momentum has swept across the EV sector, pushing many stocks down. Industry leader Tesla (NASDAQ:TSLA) is in the red this morning, as are Lucid (NASDAQ:LCID) and Rivian (NASDAQ:RIVN). For context, the Nasdaq Composite is down about 2% so far today.

As noted, we won’t see much from this partnership until 2023. For that reason, the news is unlikely to boost MULN stock in the short term. Does Mullen stand to see long-term gains from the collaboration, however? As of now, that’s certainly possible, although it is hard to say for sure.

Despite its meme status, MULN stock has failed to demonstrate any consistent growth. To the contrary, shares are down almost 90% year-to-date (YTD), having spent the last month trending downward. However, Mullen is preparing for something that could potentially save it; the launch of actual EVs in October. InvestorPlace contributor William White reports the following about the company’s upcoming EV:

“The FIVE EV Crossover will feature a 120-kilowatt hour (kWh) battery pack and 325 miles of range. It will also be able to g0 from 0 to 60 miles per hour (mph) in 3.2 seconds with a top speed of 155 mph. Mullen will also produce a High Performance version of the EV that will go from 0 to 60 mph in 1.95 seconds and offer a top speed of 200 mph.”

Ever since Mullen shot onto Wall Street’s radar, much criticism has centered around the company’s lack of physical products. In April, Hindenburg Research published a damning short report, saying that Mullen “has yet to produce a sellable vehicle.” If the October launch is successful, however, the company will finally have the EVs it needs to prove critics wrong.

Once Mullen has actual cars to sell, it can start introducing new technology. Water-to-air tech certainly has the potential to help boost sales and, likewise, MULN stock. Still, investors will need to see the October launch before they can get too excited about these futuristic features.

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On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Samuel O’Brient has been covering financial markets and analyzing economic policy for three-plus years. His areas of expertise involve electric vehicle (EV) stocks, green energy and NFTs. O’Brient loves helping everyone understand the complexities of economics. He is ranked in the top 15% of stock pickers on TipRanks.


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