Mullen Automotive (NASDAQ:MULN) stock is in focus after the electric vehicle (EV) company announced a partnership with Amerit Fleet Solutions. Amerit will provide service and warranty needs for Mullen’s portfolio of commercial vehicles, which includes the Mullen ONE, THREE and CAMPUS EV van.
To achieve this, Amerit will receive training from Mullen’s commercial product team and vehicle technicians at its facilities in Tunica, Mississippi and Troy, Michigan. Amerit boasts over 1,800 vehicle service technicians across the country. The company characterizes itself as the “nationwide leader in supporting electric fleet vehicles.”
“Every strategic initiative has been put in place to ensure the viability for our Class 1 and Class 3, from sales, service, warranty and overall vehicle support. Amerit is a well-established national provider of fleet service and warranty work,” said CEO David Michery.
MULN Stock: Mullen Partners With Amerit Fleet Solutions
Along with the Amerit announcement, Mullen also reaffirmed that it has received $279 million in purchase orders for its Class 1 and 3 vehicles from Randy Marion Automotive Group (RMA). However, this number is largely dependent on whether the vehicles are sold within a year.
Per Mullen’s contract with RMA:
“DEALER will endeavor, to the extent practicable considering all relevant factors, to sale and deliver all MULLEN Products and services that are ordered by the DEALER. At Dealer’s discretion, any new products (less than 500 miles) not sold by Dealer after a period of twelve months can be returned to MULLEN at original pricing.”
This means that any vehicle that remains unsold for 12 months can be returned to Mullen at the original purchase price. This seems like a great stipulation for RMA and less so for Mullen. As a result, the true value of the $279 million purchase order can be ascertained once RMA returns its unsold vehicles back to Mullen, if any.
Last week, Mullen announced that it had partnered with NRTC Integration to assist with Class 3 production, which will begin in July. After that, Mullen expects deliveries to commence in August and September.
Still, all of this news hasn’t helped propel MULN stock. Shares are currently trading under $1 and are down by more than 60% in the past month.
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On the date of publication, Eddie Pan 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.