Good morning, and welcome to the Hyliion Holdings Strategic Update Call. Please note that this call is being recorded. All lines have been placed on listen-only mode. We will not be taking any questions after today's presentation. I would now like to turn the call over to Kellen Parris. Please go ahead.
Thank you, and good morning, everyone. Welcome to Hyliion Holdings' Strategic Update Call. On the call today are Thomas Healy, our Chief Executive Officer, and Jon Panzer, our Chief Financial Officer. Press release related to this conference call is available on Hyliion's Investor Relations website at investors.hyliion.com. Please note that during today's call, we will make certain forward-looking statements regarding the company's business outlook and strategic plans. Forward-looking statements are predictions, projections, and other statements about anticipated events that are based on current expectations and assumptions, and as such, are subject to risks and uncertainties. Many factors could cause actual results or outcomes to differ materially from the forward-looking statements on this call.
For more information about factors that may cause the company's results or outcomes to differ materially from such forward-looking statements, please refer to our presentation and press release, as well as to our filings with the Securities and Exchange Commission. Today's comments speak only as of the date they are made. You are cautioned not to put undue reliance on forward-looking statements, and we undertake no duty to update this information unless required by applicable law. Now, I will turn the call over to Thomas.
Good morning, everyone, and welcome to the call. We appreciate your participation. As we announced in yesterday's press release, the company has engaged strategic expert advisors to support us as we explore a range of strategic options for our powertrain business. The scope of this review is broad and includes all options. The objective is to ensure that the company is utilizing its capital most effectively and is maximizing value for shareholders. To be clear, this review does not include Hyliion's KARNO generator technology. More to come on that later in our discussion. We are proud of the progress we've made with the development of our Hypertruck ERX powertrain. As we have regularly publicized, we have made consistent progress achieving the development milestones that we laid out almost two years ago.
In fact, with the recent receipt of CARB certification and the beginning of extended fleet trials with customers, we have completed all of the prerequisite steps on our path to commercializing our Hypertruck ERX powertrain. Despite this progress, the environment for companies in the electrified commercial vehicle space, including us, is changing. Companies are extending commercialization timelines amid various development challenges. Consequently, sales remain low, and many companies are facing financial difficulties without the ability to raise capital. Hyliion is facing some of these similar challenges, including the cost of procuring powertrain components is increasing due to the limited number of suppliers and low production volumes for key components, indicative of the immature nature of the electrified powertrain market. Inflation is also driving higher component costs and increasing the cost of our operations. We are also seeing a more conservative level of interest from potential customers than we initially expected.
We believe this is due to a combination of factors, including a presently weak freight market and the magnitude of challenges fleets are facing in transitioning from diesel to electric trucks. While we believe our electric powertrain is the right solution for long-haul trucking and avoids some of the hurdles with other electrified solutions, such as charging infrastructure, range anxiety, or high cost of hydrogen, we still face the longer-than-expected adoption cycle of new electric technologies in the commercial vehicle space. At our investor event in June, we described additional development work that is necessary to better address the needs of the market and to align with recent changes to the regulatory environment. This work includes integrating and obtaining CARB certification for the new Cummins 15-liter natural gas engine, developing a day cab variant of the Hypertruck ERX powertrain, and continuing to reduce the cost and weight of the powertrain.
A day cab solution addresses recent customer interest, as well as the opportunity created by the recent CARB Advanced Clean Fleet rule, which requires truck buyers to meet minimum fleet composition requirements for clean day cab trucks beginning in 2027. A similar requirement for sleeper trucks begins in 2030. We have also stated that we intend to transition more quickly to selling powertrains versus full trucks and to offer our powertrain solution to OEMs to integrate into their production facilities. These efforts would require additional time and capital as we work towards our expected ramp-up in sales. We've previously shared our expectations that we would need to raise additional capital. However, current market conditions are unfavorable, and there is no assurance that we will be able to raise additional capital on acceptable terms now or in the future.
Given these dynamics, the company believes now is the right time to consider all potential options for our powertrain business to ensure we are effectively deploying our capital and our strong cash position in the interest of our shareholders. While this process is ongoing, we will continue work with our existing Hypertruck ERX powertrain system, including ongoing validation and showcasing the solution in extended fleet trials with potential customers. We will also continue assembly of our initial production trucks at our Austin facility, which we expect to be completed before the end of the year. However, we will pause certain efforts, such as securing new orders for trucks with our powertrain system and new development work until we have greater clarity on the outcome of the strategic review.
Hyliion will continue to focus on commercializing our fuel-agnostic KARNO generator technology, which we expect to compete effectively in the stationary generator market due to its superior operating characteristics, including high efficiency as well as low emissions, maintenance, and noise levels. We expect that the KARNO generator will address the additional demands being placed on electric infrastructure and will be a preferred solution in existing generator markets. The insights we have gathered from the powertrain business and our existing partners and customers are also assisting us with our commercialization efforts on KARNO. I will conclude by noting that the board has not set a deadline or definitive timetable for the completion of this strategic review, and there is no assurance that this process will result in any particular outcome.
Finally, following this call, we will make updates that are legally required but will refrain from making any further comments about the process until further notice. With that, I appreciate you taking the time to join us today for this update call.
This will conclude today's conference call. Thank you for joining us. You may now disconnect.