By M. Marin
Arcimoto (NASDAQ:FUV) targets achieving a build rate of at least 5,000 units per annum by the end of 2020. Management also strives to drive down production costs, while simultaneously reducing construction time and increasing production efficiency as the company moves towards mass scale production for retail sales. Moreover, Arcimoto has received non-refundable deposits of $5,000 each from 100 customers who have pre-ordered the $19,900 FUV Evergreen Edition, according to the Portland Business Journal. We view this positively.
COMPACT VEHICLES TO COMBAT GROWING URBAN CONGESTION
Urban congestion is a growing problem for many U.S. cities. According to the U.S. Department of Transportation, the increase in workers and drivers has outpaced the increase in households and population dramatically over the past four decades, which has contributed to greater highway and road congestion, as well as pollution.
Vehicle occupancy rates have been on the decline, which is one factor behind the growing congestion. According to the 2009 National Household Travel Survey conducted by the Federal Highway Administration of the US Department of Transportation, the average vehicle occupancy across all types of trips was 1.67, down from 1.90 in 1977. The average vehicle occupancy in the commute to work segment was lowest at 1.13. This statistic is supported by findings from a 2013 American Community Survey that 76.4% of Americans drive to work alone. Overall, the number of vehicles on the road has increased dramatically.
INRIX Research, a leading transportation-focused analytics firm, recently released its 2018 annual rankings of the nation’s most congested cities based on delays. Among the many urban centers experiencing growing congestion, Los Angeles and New York rank at the top.
The factors noted above contribute to both congestion and pollution. An all-electric mini-vehicle could provide a partial solution, in our view. Arcimoto stresses the FUV’s suitability for daily use such as commuting to work, shopping or making local deliveries. The FUV weighs roughly 25% what a standard car weighs and has only about 33% of the footprint. Its smaller size also means it can maneuver into parking spaces more easily than most other vehicles.
Arcimoto’s Deliverator, with more storage space than the standard FUV, might prove an economic and efficient alternative to delivery vans and trucks that is easier to maneuver and park. The Rapid Responder might also prove useful in the fleet, as law enforcement and emergency services analyze ways to improve their response times and mobility solutions, we believe.
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