Ideanomics, (NASDAQ: IDEX) ("Ideanomics" or the "Company"), has announced that its MEG Group, in partnership with GCL as part of MEG's logistical vehicles segment, represents the first of a pipeline of logistical vehicle sales and financing for 2020. The order is for a total of 1,200 logistical vehicles and fulfilled by China-based EV manufacturer Jiangsu AOXIN New Energy Automobile Co., Ltd. through their X30L model, with the first 500 ordered in Q4, and the remaining 700 being ordered for Q1, 2020, for a total possible order value of 167 Million RMB, or approximately $24 Million.
The initial order signed during Q4 is for 500 vehicles, with the remaining order for 700 vehicles in Q1 2020. The vehicles are city/urban delivery cargo vans intended to facilitate last-mile deliveries. MEG will derive fees from this transaction through arranging the procurement and financing, although the company has not yet completed the accounting analysis to determine whether this revenue should be recorded on a Gross or Net basis under US GAAP – meaning the revenues may reflect net fees earned and not the $24MM order value.
"We are thrilled to get our first EV logistical vehicle orders underway, as this represents our largest potential segment of MEG in terms of vehicle order numbers and is the second of our four operating segments to successfully source large-scale EV vehicle orders," said Alf Poor, CEO of Ideanomics. "This helps us confidently plan for 2020, knowing that each of our four segments is going to be active and, along with our bus and heavy truck segments, are already sourcing deal flow. With our taxi activities in Chengdu and Guilin held over until Q1, due to municipal subsidies and new taxi license policies being put in place for 2020, we were able to bring this deal together quickly and efficiently, prior to our lease financing funding channels coming online. This, together with our Taxi activities in Chengdu, Guilin, and Yunnan province in Q1, will provide us with a platform that will ramp up in Q2 and beyond as our business begins to hit its stride."
The logistical vehicle market in China is estimated at 14 million vehicles, making it a considerable growth market for the EV industry.