The global shortage of microprocessors has forced Moteurs Taiga to find solutions to maintain its production targets as its order book fills.
The electric recreational vehicle maker has changed the architecture of its chips to limit the consequences of these disruptions, the company said in the release of its second quarter results on Monday. For the moment, the shortage will therefore not prevent Taiga from delivering its first models this year, assured the CEO and co-founder of the company, Samuel Bruneau, during a conference call.
Production is a bit delayed due to the effects of COVID-19 on the production line
The entrepreneur believes Taiga is still on track to achieve a production rate of 10 vehicles per day at its Montreal facility by the end of the year. “Obviously there is still some uncertainty as to exactly when we will be able to ramp up production, but we should hit that pace by the end of the year. “
As of July 31, Taiga’s backlog stood at 2,312 units, an 86% increase since December 31. The company pointed out that 57 global commercial operators are enrolled in its fleet program.
Plastic and some electronic components are more difficult to obtain, Bruneau told an analyst. The problem, however, is not as big as that of chips and does not threaten production, he says.
More space in Montreal
During the second quarter, the company also expanded its footprint in Montreal by leasing a new 130,000 square foot facility. The potential production capacity would thus increase from 2,000 vehicles to 10,000, said Bruneau during a call with analysts.
Ultimately, the assembly of snowmobiles, personal watercraft, electric powertrains and battery packs should be done in Shawinigan, Mauricie, where the company plans to build a factory. The facilities will have a production capacity of 80,000 vehicles and mechanical components per year by 2025. Ottawa and Quebec have provided financial support of up to $ 40 million to support this project estimated at $ 125.17 million.
Mr. Bruneau reiterated this target for 2025 during the teleconference, but did not give details on the interim targets. It was also not possible to obtain details after the conference.
In an interview with The Canadian Press in July, Mr. Bruneau admitted that the launch of the first commercial sales of the company founded in 2015 was delayed compared to initial forecasts, even if the first models will indeed be delivered in 2021. The company planned to deliver between 1,500 and 1,700 vehicles this year.
Mr. Bruneau then affirmed that this number would rather be between 500 and 1000 in 2021. “Production is a bit delayed due to the effects of COVID-19 on the production line, especially on electronic components such as microprocessors. We had to make adjustments. We have made great efforts to deliver everything in early 2022. “
The company’s net loss jumped in the second quarter, as its research and development spending and administrative expenses increased to fund mass production.
The startup company reported a net loss of $ 55 million, compared to $ 385,801 in the same period last year. This represents a loss of $ 2.99 per share.
The company has a cash reserve equivalent to $ 125.5 million as at June 30, 2020, compared to $ 7.8 million as at December 31, 2020. Cameron Doerksen, of National Bank Financial, believes that the cash is sufficient to finance an acceleration from production.
On the Toronto Stock Exchange, Taiga’s stock was down 6 cents, to $ 9.92, at the end of Monday’s trading.
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