Grande West: A promising stock in the EV space that you were probably unaware of
With a 90% market share in Canada to its credit, the maker of mid-sized transit vehicles is on a mission to take on the much bigger US opportunity. In an interview, Grande West management speaks on why investors need to keep a watch on this company, which is expected to uplist to NASDAQ this year.
In 2020, the EV industry turned out to be an obvious darling among global investors. Makers of electric vehicles and firms involved with the design and manufacture of lithium batters, witnessed massive stock rallies, ofttimes hitting outlandish valuations. If you missed these rallies, there are still opportunities in the EV space that continue to be under the radar.
One such company is Grande West Transportation (OTCQX: BUSXF), a Canadian company that engineers mid-sized multi-purpose transit buses. While the stock has witnessed a steady rally over the last 12 months in the OTC market, it still trades under $3. Interestingly, the management is expecting to file for uplisting to NASDAQ in the next couple of months.
The story so far
The company was founded in 2008 by building partnerships with the transit authorities of British Columbia and Ottawa to produce heavy-duty, mid-size buses. Currently, the company has established a presence in all Canadian provinces with a 90% market share in the mid-sized segment.
Even though the vehicles are sold in diesel, gas, and CNG variants, the new electric variant is the one the management is most optimistic about. In fact, Grande West has recently inked a supply deal with BMW to add an integrated battery pack to the buses.
Speaking on the value offered by its buses, founder and CEO William Trainer said they come with an onboard charger, much like a Tesla car, which can be connected to a 240-volt standard plug, unlike other heavy vehicles that need 600 to 800-volt connections. This does away with the requirement of massive infrastructure and costs to power up vehicles.
Separately, the management claims that their clean diesel buses save 33% of fuel expense and 30% of maintenance costs.
The road ahead
With the Canadian market mostly saturated, Grande West is now taking on the massive opportunities in the US. The company is setting up an advanced manufacturing assembly facility in Washington for Buy American compliance.
“In the US market, particularly on the EV side, the leading state is California. So new arrangements that we have made really gives us a strength in the California market, coupled up with our factory in Washington State,” Trainer said, adding that eventually, they aim to expand to all 50 states.
John LaGourgue, VP of corporate development, told AlphaStreet that an order of 100 buses that the company is currently delivering will make it debt-free. The capital on hand will be mostly deployed on developing technologies like wireless charging, electrification of larger buses, as well as to expedite the expansion into the US, the executive said.
The management expressed confidence in becoming profitable in 2021.
“We have got an existing product line that is profitable. And now we are adding new electric vehicles into that product line. So then we should have a very strong balance sheet, along with profitable operations, which makes it interesting,” LaGourgue concluded.
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