Well, good morning. That's a great way to start the day. I'm Stan March from Workhorse, on behalf of our host and CEO, Rick Dauch, welcome to the Workhorse Ranch. I hope you enjoy the chance to see the video that shows not only our vehicles, which you're gonna get a chance to see up close and personal later on today, also some of our greatest resources and best spokespeople, which are our employees. For those that are here, we sincerely appreciate your attendance. Just a little bit of housekeeping, if you will. The restrooms are out the door you entered to the left, and you'll find them on your left.
If we need to make an emergency exit, you come out the door that you entered, which is over to your front right, or if that is blocked for some reason, you exit to your rear right. Don't expect anything, of course, but we always have to be prepared. We've got a really, we think is appropriate, agenda for you today. Before we jump into the agenda, I wanna spend just a moment talking about who's here so everybody can appreciate. We've really got an interesting cross-section. We have financial research analysts from leading financial institutions that are here. We sincerely appreciate them making the journey, I think in all cases from New York. Anyway, we've also got investment bankers here, which is always nice to have, and other participants from the financial markets.
In addition, we have a really wonderful cross-section of attendees from our government partners. Of course, we've got hundreds of people that are also joining virtually on the webcast. What I wanna do for a moment is just identify and highlight some of the participants that are here because it bears noting both for the breadth of folks that are here and institutions that are represented, but also for the commitment that many of them have made from our home states of Indiana and Ohio and Michigan. Starting locally, I wanna identify the Mayor of Union City, Indiana, Chad Spence. Where's Chad? Thank you very much. Chad, thanks for committing your day to us today, and that all you've been doing to support us and also bringing the City Manager, Steve Shoemaker. Where's Steve?
Steve's with us today. Very supportive. We look forward to pulling back the veil of what we've been doing here, sharing with you what's been going on here at the manufacturing plant at the ranch. Been a busy 16 months, as you well know. We also have strong attendance here from Randolph County. We sincerely appreciate that. We have City Councilman David Lenkensdofer. Where's David? David, I need to make a special call-out here because as a bit of institutional memory that you have that I wanna highlight for the attendees here and virtually. You have a lot of history in these buildings, don't you?
I do.
Yes, you do. You were Randolph County Commissioner, how many years ago?
Something like that.
You actually worked to get Plant 23 moved from Detroit, Michigan, down here to become what is now the Workhorse Ranch, correct?
I was part of the team, yes.
You also worked at the Union City Body Company for 29 years, didn't you?
That's correct.
Well, we're glad you're here to join us, and hopefully, you can appreciate what Workhorse is doing to keep the legacy you started alive. Thanks for joining us. All right. I think you worked in all areas of management, if I'm not mistaken. Every building has somehow you've touched, which is really cool. We also have representatives here from the Randolph County United. We have Dan Baker here, who's the current chair. We have the incoming chair also, Paul Faddis. I'm not sure where. Oh, there you are, Paul. Thank you. There's also representatives here from Randolph Eastern School Corporation. Thank you very much for coming. From the state of Indiana, we have local representative J.D. Prescott. J.D. Prescott, thank you very much for attending.
We also have representatives from the Indiana Department of Transportation, so we thank you for attending. We also have faculty members from Ohio State University attending, partners we speak to on research opportunities. Thrown in the federal level of government, we also have a staff member from both Representative Jim Banks' office and a representative from Senator Todd Young's office. A very good cross-section. Thank you, gentlemen, for your attendance, particularly enduring the foggy drive up here today, which is a little different. Let me move to our agenda here and tell you what we've got planned. After my brief introduction, I'm gonna turn the microphone over to Rick Dauch, who's gonna give you his perspective.
We're to go through a series of presentations from our Chief Technology Officer, President of the CV business, the President of our Aerospace business. I'll come back up, talk a little about a particular topic. We'll take a break somewhere in there. We'll have our CFO come on up, and then we'll have a Q&A roundtable, a Q&A panel. We'll take a break from the presentations and sitting in here, and we'll take some lunch in the back. From there, we'll go over to the plant. We'll have a tour. We have some displays of vehicles that you'll be able to observe, see and hear from the staff and the team that have been working to make this a world-class manufacturing facility.
We'll, after that, have ride and drives, and as John would say, weather dependent, we'll do some drone demonstrations as well. We've got a very good day scheduled for you, we think, and looking forward to getting started. Let's get going. No single one of these activities is complete without some sort of disclaimer. We put out a press release this morning to identify the highlights of what you're gonna hear. Some of the comments that'll be made today are forward-looking, and as such, are covered by certain provisions and subject to risks and uncertainties. You can find our full disclaimer.
On any of our filings that we make with the SEC, including the most recent 10-Q. We also filed an 8-K this morning that has all the slides that you're gonna see as well as the press release. With that, with that housekeeping out of the way, I want to turn the stage over to Rick Dauch, our CEO.
Hey, good morning, everybody. Welcome to the Workhorse Ranch. Have a beautiful Midwest day for you here in December, right? It's not a blizzard, it's not snow, right? A little tough drive coming up from Richmond on those hilly roads today, I know. I figured out 64 mi or higher gets me a little bit airborne, I didn't do that anymore. We're excited to host you here at the ranch, we're kinda do this as Stan says, kind of an unveiling for us. We've been hard at work for the last 16 month to turn this site around, we're gonna talk through the details there. Why are we here today? We're gonna talk about what we've done to stabilize the foundations of this company. Talk about our leadership team.
Oftentimes, you hear from me, you don't often hear from the team. I want them to talk directly to you, both my direct staff, but also on the factory, okay. We have an exciting team here. We're building back the foundations of this company here. We're going to show you our product roadmaps. We're going to talk about our financial foundation of the company, what we've done in the last 16 months to clean up the balance sheet to make sure we'll be one of the EV companies that survives going forward, for sure. I also want to tell you that we are at a point where we are 100% focused on execution. We wanted to have this meeting in December because we are going to be busy as hell January through next summer launching products.
I've already had the board of directors here. I see Pam, thanks for coming in and help being here from the board. Appreciate that. We're gonna be very busy, working on turning what were two startup companies into a real company. What's different about Workhorse today? Why are we a differentiated commercial EV business? I'll talk about in a couple slides. We have a clear roadmap. We've got real facilities. We have a hidden asset in our drone business. I think in our stock price today, there's a zero value attribute to that, and you'll be surprised about what you hear today from John Graber and his team, and hopefully, we do get to fly if the fog lifts here. We just did some great work in the last 140 days.
John will talk about developing new products, and we think we can help change the world with our drones as well. Our facilities, what we inherited a few years ago is totally different today. I'm born in the Midwest. I was born at Purdue, when my mom and dad were freshmen in college. Little surprised, I think. I grew up in Michigan, and my grandparents from Ohio. I'm a Midwest kid at heart, and so driving across the farm fields last night and today just brings me back to my days seeing my uncles and aunts down in Ohio and that kind of stuff. We'll see how Purdue does in the bowl, the bowl game here, so.
Again, we did a lot of work in the first year of our tenure here to make sure we have a financial foundation we can execute the plan we put together. Okay. Commercial EV space. It's really a tale of two cities. On the one end, we have tremendous tailwinds. In fact, in my 30+ years of business experience, I've never seen economic tailwinds as strong for any business, okay? As we know, because of the pandemic, online shopping, home delivery has boomed 15%-20% a year over the last four or five years. I know my house is busy right now with I have 11 grandkids and seven kids, and five in-laws. There's a lot of packages being delivered to our house. It seems like someone's delivering a package about every hour to our house right now.
That's important stuff like that. Stringent CARB requirements. California leads. 14 states are following very quickly. I will tell you here, we're behind what I saw when I lived in Europe for two years, and we're behind what's going on in China when it comes to EV. I live in downtown London. They're banning all diesel cars. They can't go inside the city right now. Soon to be trucks will be banned as well. By 2035 in London, you have to be either in hybrid mode or electric mode. That same path is coming here to America. It's gonna start on the West Coast, it's gonna move quickly to the East Coast, and it's gonna go across to our major cities here. One of the areas that we can bring EV to the market sooner is to the commercial vehicle market.
The government's putting huge money behind all these programs. The Inflation Reduction Act, whether that's the right name or not, that's not for us to decide, but $369 billion, not million, billion dollars earmarked for green technologies, specifically in the commercial vehicle space and others. Another $15 billion in the Infrastructure Act, mostly for buses and charging systems, but charging systems are needed everywhere. The DOE Advanced Technology Vehicle Program's another $15 billion. All this is gonna roll down for EV tax credits for commercial vehicles. It's rolling down to the state level through funding, up to $100,000 for Class six vehicles, $40,000 for Class four vehicles. Today, an EV is much more expensive than ICE because the volumes aren't there and because battery technology is not where it needs to be today.
It will get there in the future for sure. Also, John's gonna show you some details around just how fast the drone market's taking off. I come out of the military, some of you come out of the military, some of my best friends have been using drones for 20 years. The drones can deliver packages, okay? They've been doing it in the military for a long time. It's now gonna come to the commercial world very quickly in the next few years. You'll see the explosive growth in the it's projected in the drone business for sure, so. That's all the good news. The bad news is the EV segment, especially in the last 18 months, has been struggling. No one knows that more than the Wall Street guys, right? Stock prices are down 70%-90%. We've already seen one Chapter seven.
We have a couple companies on the precipice of Chapter 11. Guess what? Building a car company is easy with a PowerPoint slide. It's really hard work if you actually have to build a factory, tool suppliers, build equipment, hire and train people. That is hard work, okay? We think we have a differentiated team here that has done that before. In the drone world, John and I attended with his team out in Vegas earlier this year, the big commercial drone exposition. There were over 41 displays of different companies there. We think there's over 100 startup companies in the drone world right now. The majority of them have no experience with FAA regulations, or they don't have what it takes to build and manufacture those kind of things. They're doing more like prototype type shops and stuff like that.
This our experience, you know, many companies, I think, lack, based on what I see, some real-world experience. There's a lot of SPAC companies out there who put out PowerPoints, and almost every one of them, if you take a look at, has failed to meet any of their projections over the last two years. All that money they put on their balance sheets is quickly dwindling away and going away because you still have to build a factory. Building a factory doesn't happen in six months. It doesn't happen in one year. One of the great things we have here is we had the bones of a great building, and we renovated it, okay? We were able to go secure a building for ourselves in Mason for our aerospace business. We have factories today. Many of my EV competitors don't have factories today.
They talk about building factories. They talk about having a bunch of orders, you can't fulfill orders if you don't have a factory, okay? In startup challenges, product development doesn't always go perfectly. Production doesn't always go perfectly. Supply chain doesn't go perfectly. You got to finance your company, okay? I would say I'm a battle-tested automotive industry veteran. This is my fourth gig as a CEO. 15 years. Those of you who know me, who've invested with me before, know I usually go to trouble situations. $1 billion-$5 billion revenue companies, I usually have to go in and have to do some really hard work. I have to close plants. I've got to lay people off. I gotta close technical centers.
When I got to Delphi a few years ago, we had to close nine technical centers in less than a year, close three plants. That's horrible work. I'm much more excited to be here, where you're actually resurrecting a plant and hiring people. This is the most fun job I've had since I was a company commander in the United States Army, okay? It's small enough. I'm not on a global plane everywhere in the world. I'm in Union City, I'm in Cincinnati, Mason, or Wixom, or I'm at customers and that kind of stuff. In my 15 years, I developed a plan we call Stabilize, Fix, and Grow. When I go into a company, I take a quick assessment.
In the first 90 days, I meet the people, I learn the products, I meet the customers, I talk to suppliers, and we put together a plan, we take it to the board of directors. In this case, I took over a company, but really when I got here, I found out we really had two companies here. We had two technology startup companies. One in the aerospace business that had been working for 5.5, six years to develop the drone technology. An EV company which had bounced around almost for 15, 20 years, dabbling in EV products, commercial step vans, pickup trucks, helicopters, the drones, et cetera.
We stepped back and said, "Okay, we need to figure out how to make these startup companies into a real company." We're gonna follow the same path that we used to go restructure the big legacy companies, but the other way up. We're gonna grow it from the bottom up. Starts with ethical people, selfless leaders, team players, no politics. You have to listen to your customers and listen to the market, and you have to have the best in class in your segment, product technology, process technology, and systems technology, the IT systems, which is like the central nervous system here, okay? Core versus non-core. Usually, when I go somewhere, there's assets that don't make sense that I can sell to raise money. Here, there's no assets really to sell. Okay? There were some extra parts to sell.
There's two extra buildings to sell. Really, we have two core businesses, the commercial vehicle business and the commercial drone business, both aimed at the same end markets, basically, so. Got to create a competitive cost structure, lean systems. You'll see here about that later on today, and then we'll profitably grow. There's no shortcut in building a company or fixing a company. Starts with people, great products, great processes, world-class plants, great systems, common systems. If you do that, you can build a company. That's exactly what we're doing here. If I look at some of my peers in the industry, they started at the top. How much money can I generate for my shareholders, oftentimes themselves in SPACs, okay? I've seen a lot of paper billionaires in this space in the last few years who are no longer billionaires, okay?
We're doing the hard, boring, grinding work here to execute a plan to create a real company here at Union City and across the company. It starts with people. Oh, I was a slide behind. Sorry about that. All right. That's what I just talked about, okay, sorry about that. Experienced leadership. 14 people in the leadership group. Only three were here when I got here on day one, and one of them had only been here two months. Greg Ackerson is a survivor, Chief Accounting Officer, gonna lead our ERP project. John Graber, leading our aerospace business, had been a test pilot and came on full-time about a year before I got here, and Ryan Gaul got here two months before I got here. Everybody else who's recruited to this company came from all over the industry.
Over 400 to 500 years of experience in the automotive industry, the commercial truck industry, the aviation airline industry, and in government affairs. We've got a really solid team, I'll put it up against anybody in our space in the EV sector. You're gonna meet them today. Markets, when we got here, we had two products. We had a C-1000 van, which was struggling. We had a drone, both of them designed to UPS specifications. Those were our two customers we were talking about, UPS and UPS Flight Forward. Today, we have a whole different product portfolio. By the end of 2025, we'll have five different products in our commercial vehicle space, already we have two different products in our drone space, we can diversify off of those going forward. Okay.
I'm not gonna talk about that and steal the thunder of the guys, but we have a very detailed product roadmap, and we're gonna execute that product roadmap. The heartbeat of any automotive company is its product plans. Those of you who buy cars and trucks, you know when the new car or new truck's coming out, about every two, three , or four years. If you're Toyota, you can do it every three or four years. If you're General Motors, every five or six, because those with the great balance sheet, those who generate the cash, can turn their products over faster. That's our goal. Our goal here is to generate sales, to generate profits, to design new products, to keep growing the company in the future. That's how you build an automotive company in an OEM company, so. We're sitting today here at Union City.
Well, what'd I tell you? I got here August 6th for my first visit. I had been here a long time ago when it was Workhorse Custom Chassis. They were a customer of ours at American Axle. We had to shut them off from axle supplies because they were running out of money. What I inherited here and what the team inherited here was a sad situation. A plant that had been left in disrepair, nearly abandoned by its previous ownership team. Weeds, broken equipment, run-down parts, vehicles that had been crashed. It wasn't the worst plant I've been in, for sure, but it was probably in the bottom 10, okay? The good news is there's good people here. There were good bones here in the building. The building was okay. It just was tired and old.
What you're gonna see today is a completely renovated factory. We don't have a factory anymore. We have a complex here on this site. We've taken over the warehouse next door. We're in the process of finishing up cleaning it up. I used to call it the Bat Cave. I kept waiting for Batman to come out of the ceiling. It was so dark and ugly in there. We have a battery storage facility here, so we have safe storage for our batteries. We have an NVH test track. We have a certification center to host and train our customers and the technicians in the field who will service our vehicles. Not everybody's driven an electric vehicle. It's different than driving an ICE vehicle, okay?
You gotta get the drivers up here to understand how to do it, and you take them around and drive around the facilities or up and down the roads or across the NVHS test. You'll see the facility today. Talk to anybody you want. Look anywhere you want. There's nothing to hide here at all. We have nothing hidden in trailers, nothing moved off-site. This is what we have every day. I used to be up here every two weeks. I'm only up here now every four or five weeks because I have 100% confidence in the team. In fact, I haven't even looked at the factory in the last 24 hours because I just know the team will be ready when we get out there, so.
Down south in Mason, Ohio, we just secured our facility for our drone production. Today, we have zero production in that facility. We have zero equipment to produce things right now. We have prototype shop there, but by early next year, we'll have production facilities, and we'll be also building drones. We'll have two world-class plants here in the Midwest. It kinda warms my heart. In the past, I've had to close plants in the Midwest. I've had to build plants in Mexico and China and Poland and Romania and other places. It's damn nice to rebuild a plant and bring it back to life here in Union City. This plant used to employ, as I understand it, back in its heyday, somewhere between 800 to 1,000 people in a city of 5,000 people.
That's a huge. When we got here, we had 60 or 70 people left, and they were kind of downtrodden, sad in the face, pissed off. That's not what you're gonna see today. You're gonna see people who are like, "Let's go kick some butt," okay, and that kind of stuff. We've established a great foundation, got a good organization, top-notch leadership team. We've doubled our engineering teams, both in drones and in commercial vehicles in the last year. We opened up a technical center up in Michigan, where we could get some of the people retiring from some of the bigger companies to come work for us to train some of our younger engineers. We've got great experience in supply chain, lean from the biggest companies in North America, so. We have our road maps, and we're executing them.
We run program reviews every single month at my level. Every single week at the working level. If we're behind, we let ourselves know it. Tell the truth. Let's fix it. Let's move forward, okay? Modernize facilities. There's no stone. We got a few things left I see when I drove around last night to get cleaned up. We'll do that in the springtime once we get through the bad weather. We've taken care of our legacy issues. We, we stopped and suspended the production of C-1000. We dropped our lawsuit against the federal government, U.S. Postal Service. It's hard to sue what could be your largest customer someday in the future, who has the largest fleet in the world called the U.S. government. If you sue them, they're probably not gonna source you any drones or any trucks. We just settled.
We announced last month our class action lawsuit with our shareholders. We did it in a very friendly way. Bob will talk about that. We're financially stable. We converted our shares in Lordstown Motors, which spun off of this company a few years ago. We sold those when I first got here, put the cash on the balance sheet. We're a debt-free capital. Bob will talk about that. We converted the $200 million of debt into an equity position, and we have an established ATM to raise more money. Fourth quarter priorities. We're not done yet, even though it's December 7th, we still got some work to do. Execute our product programs. As we speak, we're building the pilots for the W750, so we can launch them in the first quarter. We're maintaining our W56 program. That's the big delivery vans.
You'll see a couple of those program builds we have there. Our program is on schedule today. Complete the C-1000 testing. That's not done yet. The C-1000 is still going through tests. You'll see some of those running up and down our NVH test today, so. Complete the HorseFly and Halo. John will talk about those. We need to grow our sales. We're not out touting what our sales are. We've been quietly behind the scenes fixing the foundations of the company. Now we can go out and sell. When I leave here today, I'm getting on a plane with Christina Amy, and we're going to Portland to go see one of the biggest commercial vehicle dealers on the West Coast to see if we can sign them up as a dealership. They sell some of the number one or two seller of commercial trucks in all North America.
We're building up that. We'll talk about that later today too. Ramp up production. The work is done. Just like a farm, you gotta prepare the field before the harvest. We've done the work, we've prepared the field, now it's time to us to go in production. That means suppliers have to be ready. That means our tooling has to be on the factory floor. That means our people need to be hired, and we need to train them. Over the next few years, we're gonna hire somewhere between 250 to 500 people at this site alone. We'll bring this plant back to life. That'll help the community. Chad, I hope that helps the city and the other businesses in the community, whether it's the restaurants, the laundries, and all that kind of stuff like that.
Finally, we had to implement our common IT systems. That's easier said than done, okay? IT systems are tough. We've chosen QAD. We're kicking off that program next week. We'll have our new IT systems online next year. That's what we're doing. We're rebuilding our foundation, enhancing our capabilities, actionable roadmap that we can definitely put out there. It's based on what the industry wants and what our customers want. We're confident we can deliver that. We are strong this relentless focus on execution, execution. If we do that, we'll be one of the companies that emerges as a winner in the EV space. I'm here to tell you, we're gonna show you today that Workhorse is ready to run and fly.
I'll now bring up Josh Anderson, our Chief Technology Officer, who'll talk about our technology both on our commercial vehicles and our drones. Josh.
Good morning, everyone. I'm Josh Anderson. I'm the Chief Technology Officer for Workhorse. I'm thrilled to be up here to talk to you this morning. A little background about me. I have been in the electric vehicle industry my entire career, going back to 1998 when I had determined that hydrogen-powered solar aircraft were the way to go. I quickly pivoted into the Class A bus world, and products that I've led and teams that I've worked with have more than 6 million mi of on-road, real-life service outside of the Workhorse products. I have been involved on the mechanical side, the electrical side. I found a big need when I started that people didn't understand battery systems or electric vehicle controls.
I've really touched all aspects of the industry from the heavy bus and truck side to the aerospace side, mining equipment, and some, actually some marine products as well. What I wanna do for you today is walk through with you Workhorse and how it arrived where it is today as a leader in technology, what our product roadmap is going forward, how we design and build our products to make sure that we can build a world-class sustainable OEM. Then talk a little bit about where we see things going in the future. About 1998, actually, if you looked at this site, you'd see a business that had been here for the entire century, the entire 20th century.
Even back then, while I was starting with Class A buses, the team here at the Union City Body Company was deploying their first EV delivery vans as well. I wouldn't say that was a successful product. At the time, we were all struggling with battery technologies and understanding use cases when the cost of fuel was cheap, right? Still, the company that later became Workhorse and grew on this site was really focused on new product innovations, whether it was their W62 program or other products. Meanwhile, as the 21st century started, a small company in Cincinnati, Amp Electric Vehicles, started to explore electric vehicles in the automotive sector. When I first visited Amp in 2010, they were really struggling to find a pathway forward.
By the time I visited them the second time in 2013, they had acquired the facility here and the Workhorse brand and had really made a pivot into commercial vehicles, seeing this as a segment that had a lot of opportunity to push forward with bringing EVs into everyday use. As that team continued forward and looked at the Workhorse asset here, they developed some very early all-electric step van products on their W88 chassis. After the first dozen or so of those full electric vehicles were brought to market, they pivoted to hybrids, again, to focus on the technology that was available. That resulted in somewhere between 360 and 380 of their EGEN products between 2015 and 2017, and those vehicles continue in service today.
We estimate there may be as many as 9 million mi of road use on those vehicles, and many of them continue to run. As the newly rebranded Workhorse moved forward from that starting point, they really began to look at all of the different aspects for commercial delivery. We see the W-15 vehicle came out, was released in 2018, which led to the licensing by Lordstown Motors and their Endurance pickup. We saw the first work with drones to find new and innovative ways to deliver packages, and that work has continued. Through some of the other programs that brought us up to the C-Series today and really have formed the foundation for where we're moving forward with new product. Let's talk about new product and how we get there.
When I came in, to take a look at Workhorse 15 months ago with Rick, you know, we really studied what was going on, the products were really innovative. A lot of thought had gone into applying new technologies. More effort needed to be placed on product development. One of the refrains that you're gonna hear from me today is our really renewed focus in the last year on a solid, robust product development process. Our philosophy is that commercial vehicles built by Workhorse have to be safe, reliable, and dependable every time they're used by every customer who uses them. We have to focus on delivering uptime to those customers and making sure that the products that we're offering can be counted on, and in this way, delight our customer base to make sure that they are excited about Workhorse products.
We achieve our goals by making sure that we design correctly, that we design to best-in-class specifications with a really a focus on all the stakeholders involved in the process. It's not enough for me or my team as engineers to say we think this is a good product. We have to involve the people who assemble our product, the vendors we source from, the partners we have in design, the people who have to operate the vehicles, our core customer, and the people who have to service and work on those vehicles for whatever reason in the future to make sure those vehicles have robust uptime.
We have to continually go back and measure our work to make sure the products we're developing are relevant and available to our base, to make sure that we are striving to always improve the product and maintain that best-in-class position, to build, measure, validate, and test what we're doing at every step of the way to make sure we're delivering the best product we can, and really to keep in mind how that vehicle is gonna be used through its life. One of the ways we do this, one of the things that we brought in is to follow, as Rick would say, the boring, hard work of product development. We have to focus on a formal, rigorous design process.
One of the early things we did was to add that Wixom Technical Center in Detroit. Part of that was to leverage the knowledge and skill set of people who have put vehicles together for their entire careers in an industry that's got a well-established process. It's very easy to build one vehicle that's really neat or 10 vehicles that are really impressive, but to take those vehicles and make them a sustainable, mass-producible product that can be built reliably and consistently and deliver value to the market is much harder. We use a process like this.
You can find it in any engineering textbook, but we use a process like this that involves everyone who's a stakeholder in the process from the voice of the customer at the beginning and the feedback loop for that, to bringing in the assembly team at the factory, the supply chain who has to source and supply parts to put those vehicles together, and the people who have to work on them and maintain them as part of the process. Starting from the Class three vehicle that we were offering when we came in last year, we've really focused on the needs of the commercial vehicle industry, whether that's on the truck side, where we're looking now at how we can serve the larger segments of that market. Ryan will talk more to that, TAM, when he talks about the CV business.
The aerial delivery segment, where we see there's huge opportunities for growth, and John's gonna take you through that. Back to our mission statement as a company: to pioneer the transition to zero emissions commercial vehicles. Pardon me. We've really focused on how can we touch that in as many ways as possible. We've looked at as you move up in weight class, we see a demand for increasing payloads, and we've tried to tailor our products to that with the high-capacity W4 product and moving into the abilities of the W56 product. We've also focused on the needs of range as you move down in size, and those vehicles have to accomplish more miles in a day, and how can we best address that?
If we look at Class four and the work that we're doing there, we're really seeing that with the advent of electric vehicles that might have traditionally been a Class two or Class three vehicles are understandably heavier because of the requirements for battery storage on board. We see customers now moving into these higher weight classes to take advantage of the payload that's available. We feel we're industry-leading with the W4 CC and the ancillary W750 step van product and the amount of payload we can deliver to those customers. Similarly, we're focused on range. As any of you who drive electric vehicles know, range is highly dependent on temperature and how the operator uses the vehicle.
We focus on being able to provide substantial range in this product, not only for urban duty last mile delivery, but we're seeing a lot of additional demand from customers who wanna see this as a courier to take products from one site to another, expanding the reach of where these vehicles are used in the Class four segment. To refer back to my design development process slides, you know, here's just one good example. As we work through the W750 build, and you'll see this vehicle out on the floor today at the factory as you go around. You know, it's really all members of the Workhorse family working together to bring these products to market.
In these pictures, I can identify the manufacturing engineers, from the plant, technicians who will be building these vehicles online in process, some of my design engineers, and supply chain people who are all involved in this slow, methodical build of these first vehicles to make sure that we've measured twice, cut once, and we can do it again. When I look at our first ground-up design, the W56, I'm so excited by the way that we've executed this product plan. When we sat down last year and said, "Where do we need to go?" We said, "Well, we don't wanna touch just Class three.
We wanna touch up through Class six." We really need to go back to our roots and look at the products that Workhorse was famous for and built reliably and dependably for years, and let's bring that forward into the 21st century. From a clean sheet, we've gone through and re-engineered the Class five, six step van and a cab chassis variant of it as well to really focus on delivering best-in-class to this customer base. Whether it's operator ergonomics or step-in features or gradability or visibility, all these things, we first went out and benchmarked the product that we had built in the past and the product that others had in the market and said, "We can do better, and here's how." Followed a very rigorous process of evaluating ourselves and questioning, How can we deliver the best product possible?
After we designed it and our team worked countless hours on this, we said, "Now let's go build validation vehicles." Those program vehicles you'll see the first few of today when you come out on the floor. This will be the first time we've really kind of pulled back, pulled that back and showed the world what we're capable of doing as a team. Again, the same process in place. These builds have been done slowly and methodically on schedule.
When a bolt doesn't fit, when a part doesn't line up, when the upholstery is the wrong color, we stop, we record, we capture that. The team immediately goes to work to addressing that issue right then, right now on the product with the input of the manufacturing team, of the quality team, the suppliers, and the supply chain team here at Workhorse to make sure that as we build these vehicles, we're updating, validating, and building the best truck we can. When we look at the chassis, we spent a lot of time thinking through deliberately why we do the things we do with this chassis.
Whether it's putting the batteries inside of the frame rails, designing for the loads of this vehicle in an empty and a fully loaded condition, whether it's things like integrating the technologies of an e-axle on the drive axle, something we worked heavily with in 2017 and 2018 and then brought forward into this product. Again, I'll refer to the driver ergonomics of designing the mechanical underpinnings of the vehicle to give the best cabin experience for that operator. We've tried to integrate all of our learnings from our decades in the business and our experience from outside the company to make this a world-class product. The body at the same time, very similar comments here, right? We've leveraged some advanced technologies and composites combined with an aluminum base structure.
We've redesigned our extrusions to make them easy to assemble and make this a really smooth and clean vehicle to put together. We focused on the ergonomics of the operator and how they interact with the vehicle during the day. I'd be remiss to not also talk about the drones. My key takeaway here as I look at drones is that we are taking the same efforts and making the same design decisions and approaches with our drone business that we do with the trucks. I'm proud of the fact that our team is working towards FAA certification and is working in that environment to build to the highest standards possible. Some of the best product reviews that I have observed as CTO of this company have come from that drone group.
I'm really proud of what we've been able to do with our engineering team over there. Drones are integral to what we're doing. When I look at how we deliver across different markets, drones represent the ultimate high-efficiency EV package delivery system. I think that's so cool that the drones give us an opportunity to do something in our space that is, from an efficiency standpoint, just the ultimate product. I also need to talk about some of the other things we do. Our Metron system, our telematic system for our vehicles, has been on our vehicles going back to 2015. Those 9 million mi of service, that's not a guess and a number. Those are numbers taken from the data we collect on all of our vehicles in service every day.
The actual number is 8,995,726 or something all approaching that at the level of detail that we have for what our vehicles have done and what our vehicles continue to do every day. We capture where they've gone, how fast they've gone, the energy they've used, all of this information. A huge resource for the company. We're not stopping there.
We're taking that forward as well, too. Over the next two years, you're gonna see us roll out additional features in that Metron system to really focus on overall fleet use of the vehicles, whether it's management of the fleets and the vehicles themselves in a combination where an operator may have 10 vehicles and they need to track them and figure out how to most effectively use them, or whether it's the maintenance support and assistance with those vehicles when they do have issues or they're ready for a tire change or other service to the training, the service, and the testing needed to certify people to operate the vehicles or to work on the vehicles. I'm really excited about where Metron is going.
When I look at our product roadmap and what we filled out over the next few years, we're learning a lot about our customer base. We're learning a lot about our products. We're really focused on delivering high efficiency, low floor and optimized vehicles. We're looking at serving as many markets as we possibly can. When we look at what W Next is gonna be and where the vehicle of the future is, we've really got to continue to address what our customers are asking for, what our customer needs are as the market shifts, and where we can take that, both with our existing product lines and the products to come. At that point, I think it's time to turn it over to Ryan Gaul and let Ryan talk to you about how the business is gonna accomplish the goals of building and delivering our trucks.
Good morning. Am I on here? Yeah. Okay, then I can step away a little bit. My name is Ryan Gaul. I'm the President of the Commercial Vehicles business. Most days I don't get to come out into the light 'cause I'm head down making sure that we're executing on a product roadmap. Fundamentally, that's my focus: execution. I've been in the automotive industry now approaching 23 years. I started out in IT. I was a CIO. For six years, lived in Germany. I did a common systems rollout across an organization around the globe, just like we're doing here. I lived in China for six years, where I built factories and ran factories, and grew that organization there about 10x, from around $25 million- $250 million in those six years.
I moved into strategy and marketing, did business development. Finally, at my previous company, I was the Head of Global Operations, where I ran, you know, 10,000 people across the globe and around $750 million in costs. When I left that organization, one of the experiences I'd taken with me was, you know, we had started an EV, and I thought it was both fascinating and challenging. Of course, you don't have to be, you know, an oracle to pick out that EVs are happening and coming in the future. I said, "I think I would be really happy if I could find an opportunity in EV." When Workhorse came to me, I said, "Let's take a look. It's the right product.
It's the right time for that product. It's in the right market. Let's go see what they've got." I came down, interviewed with the team, came to the plant. I had similar impression to Rick. I think between Rick and I, we built, you know, maybe 15 plants. Most of them are on his ticket, but, you know, I've got about five under my belt and visited hundreds. I would say, you know, what was clear was two things. Everything we needed was here. It was just covered in things we didn't need. We had a great team. I think that was really what convinced me, you know, it's the, it's the people that you work with. As I talk about how we execute, I'm gonna talk about people just as Rick did.
If I talk about Workhorse and advantages, and I'm gonna show you sort of the summary of the message up front. What are the advantages here, really? Product, we have product in the market now, delivering from this year in the W4. We're working on a comprehensive portfolio of products that will be in the market by 2025, covering classes three through six. We've got product that's purpose designed and robust. As Josh talked about, those factors of robust, easily serviceable, high quality, dependable. They're critical for the success of our product, but also for our customers. When we talk about execution, what are we doing it for? We're doing it for our customers. What are customers interested in? They're interested in maximizing the usage of a high-value asset.
Any truck, be it ICE truck or an EV, is an acquisition cost. EV acquisition costs are a little bit higher, as some of you may know. Maximizing the uptime is critical, and we're focused on that. Plant and process. Having a plant is great. You can bring it to a world-class level in terms of tools and shop floor, but you need process to make sure that you're able to execute in a reliable way. We need our process to be sustainable, repeatable, and reliable.
We're focused very much on implementing, automotive-grade processes through the supply chain, making sure we have reliable partners that we're bringing in not only the right suppliers, but suppliers that can meet our demands for the future as well on cost and availability, right product, right time, right place. We need room to grow. I have a slide here. I'll show a little bit of overview of the plant too. You're gonna hear a lot about the plant today, I'll talk about that then. Again, people. It's the people here in Union City that convinced me to come to the company. I mean that quite honestly. My grandfather was 48 years at Ford's, retired from. As you say, Ford's, if you retire from there, from the factory, it's that was what you say.
I've got his clock at my home. You know, as a kid, I said, "I have all these ideas what I'm gonna do. What I'm not gonna do, I was born in Pontiac, my family's been automotive, I'm not gonna go into automotive." Be careful what you wish for. As I grew up, and I really say grew up, I realized this is a wonderful industry. It does lots of things. It's exciting. You get to engage with great technology. You get to build teams. It's fast-paced. You get to build not just products, but you get to build livelihoods. My grandfather retired after 48 years, and my grandmother continued to be supported by that livelihood. We're gonna do that here in the Midwest, in the United States. I always say I owe a debt.
I spent six years working overseas, and I moved a lot of jobs overseas. We're gonna bring them back here. As we see through the plant, we've got room to grow, and I have every intention of being here to make sure that we fulfill that promise and we fill this factory up with great products and great people, and that we build livelihoods here in the Midwest. What are the pillars of executing on this plan? Teams, teams, teams. Having a strong, capable team. Josh talked a little bit about locations. Rick did, too. We've upgraded our facilities. We need to make sure the teams we have have the tools they need. That was really everything from acquiring software programs. Do we have the right CAD tools? Putting simulation capabilities in place.
We put in a server farm so we could simulate before we build and make sure that, you know, we can measure twice and cut once. Really bringing in talent at the top to grow talent at the bottom. If you wanna build a sustainable business, you gotta have sustainable teams. That means that you're not just recruiting and turning people over. It means that you're retaining and engaging the people you have. That means showing them a future and a career path as well. We're incredibly excited about the young engineers we have here and the young people we have coming into the organization. We're very glad that we have mentors that we've been able to hire in all of our markets to grow those teams. Sales and service, of course. Nothing happens without sales.
It's great to build a product, but this is not the field dreams model. We are out engaging with customers, and we are getting the customer voice up front in order to bring it into our product. I'll talk a little bit more about that in the last point. At the core of how we do and how we execute is really operational excellence. I think you hear that a lot, in and around the world. What does operational excellence mean to me? What does operational excellence mean to Workhorse? It means, we are process-driven to ensure repeatable performance. We have metrics, and we manage to them. We manage to the number, and we know the number. It's important on the shop floor. As a plant manager, what did I do every day?
Got to the plant first, went out to the shop floor, checked what are the numbers. Came in at night, go to the shop floor, check what are the numbers, then go talk to the people. That's how I find out what's going on. Supply chain continuity. Supply chain is a challenge. I'm not sure if you've heard that before. If it's news, we can talk about it later. It is a real challenge out there. Everybody has it, so that's good news for us, because we're facing the same challenges everyone else is. We think that we have done great work in our go forward, to make sure that we have partners that are here as much as possible, so within driving distance.
We sit here in Automotive Alley, where 60% of the automotive industry sits in the corridor between Michigan and Northern Kentucky. We've done our best to source most of our components within that corridor. We've got a great supply chain team that is doing that. Putting world-class manufacturing processes in place, and it starts with lean principles. As Rick mentioned, we brought, I think, one of the best trainers and consulting companies in the world in lean, and we started on day one with a factory player. One of the most exciting things for me to see when I come here is to see the team coming and telling me about lean. "Here's why we do it. This is why it matters." They understand, right thing, right place, right time. They understand reduced throughput time.
They understand minimize inventory. They understand why those things matter. Those things matter because those things drive cost, and those things drive performance. Fundamentally, they give us great quality. Software. When you think about the product, the product is not just a truck. The product is a package of services that we provide to the customer to ensure that we're maximizing value and net asset for them. The product is software, both behind the scenes in the cloud, managing, measuring the performance of the vehicle, and in the vehicle, ensuring that it is running smoothly, that it understands what to do when critical components are nearing end of life, things like this. The vehicle is an asset, an asset supported by software and services, and we provide all of those things as part of our plan. Product engineering is how we get there.
I think, one of the things I thought when I came here, and I'm very glad that I'm on a team like I am, because I think we think in a similar way. An EV, the important letter of that is V. It's a vehicle. Now, what is it? It's a vehicle driven electrically. Fundamentally, what our customers are looking for is a vehicle. The electric part of it is an interesting thing about it. It's an important thing about it. They have desires that drive them to want an electric vehicle. Either those are regulatory, ESG goals, being wanting to be an early adopter right now, or wanting to look at lower cost of ownership that actually comes with transforming a fleet. We've designed for the real use case. We're not driven by buzzwords.
You don't hear many of those things when we talk. What we talk about is robust, high quality, easily serviceable trucks with flexible body options, because that's what the customer asks for. Chris is nodding. I got it right. Those trucks then need to have market-leading payloads, right? What does that mean? Josh talked a little bit about the weight issue. I'll talk about that when I get to the TAM slide later on. Payloads are important, right? What is the purpose of the truck? It carries something from Point A to Point B, unloads it, goes back to the depot, and gets something else put in. Needs to be able to carry payloads, maximize. Competitive ranges. Range anxiety is something talked a lot about.
I think it's something that we have 9 million mi of data within our Metron database that show is something that shouldn't be too concerning within most applications of commercial vehicles. We will be in the 150 mi range in our vehicles across the board. When we look at actual usage data, what we see is that's more than enough. With that range, you can deliver your standard route, which is, you know, under 80 mi return to the depot at a great state of charge, and choose your charging time to charge economically. We put together a team. We talk a lot about teams. I think I've said it on every slide so far. I won't say too much about the individuals here. I run the commercial vehicle business with my two colleagues, Josh, who helps lead technology.
I'm not an engineer. I do pretend to be one in program reviews very often, and I've learned a lot over the years, so sometimes the engineers are a little surprised. "How does he know that? He's not an engineer." I have a little microphone on my ear. Usually, Josh is feeding me lines. I got Jim Peters over there. Jim is head of supply chain. Jim has decades of experience, and a great sense of humor. I know when we're in tough times, I can always rely on Jim to cheer up the team. And he's been a great colleague and has built a great team to help ensure that we have that automotive-grade supply chain and that every one of our suppliers and every one of our parts goes through a process. What is that?
Advanced part APQP process, right? Every part goes through it. We make sure that we have a plan for every part. That means we know how many parts are coming in, how many are in the box, in individual packs, where they're stored, what we paid for them, what the storage conditions are, how we're gonna bring that material then to the shop floor, how we're presenting it to the line, how the line takes it out of the presentation material, how it's installed. We have a plan for every single part, and that's a huge undertaking for thousands of parts in a vehicle, but that's how you build a reliable product. It starts really at that planning phase. We've got an advanced product quality team that's out every day on the road at our suppliers, pushing, measuring, asking for more.
In the engineering side, we've got incredible experience. Across the team, we have thousands of product launches and dozens of vehicle launches. Everything from commercial vehicles and passenger cars to presidential limousines have been launched by members of our team. Beyond that, we've got people on the team who've written the drive software for some of the EVs you see on the road today. We have the capabilities of the senior level engineering team, not only to get the products out the door, but really to make sure that we're building sustainably a team that can bring those products to the market over time as we launch new products each year. Sales, great sales team. Very glad to have a new sales leader on board.
What we've done over the last, I think, five months has been a whirlwind of building a network, building partners, engaging with our dealer partners to make sure that they are ready for what's coming. They're incredibly excited, we think that this is really great opportunity for us. Working through our dealer partners allows us to have great national reach in the right markets at relatively low overheads compared to having to go out and engage with fleets directly. Keep in mind, most of the fleets are small fleets. There are a few national fleets out there with hundreds of thousands of vehicles, the rest of the fleets are, you know, under 80 trucks and really under 50 trucks.
We need to reach all of those fleets, and having dealer partners and dealer networks who have those customer contacts, who have those relationships is, I think, critical for our national reach. We've got a great team on board that brings with them their own dealer partners as well as that reach themselves. Then the execution side in operations, we've got dozens and dozens of years of experience, plant management, product launches, commercial vehicle manufacturing, as well as data analytics, and quality analytics at a very high level. We're building that talent now into the intelligence of our back-end systems in Metron. How big is the market? We're very conservative. When I talk about TAM here, I talk about what we think the available market is in 2025 across our segments.
We're targeting a TAM of a bit greater than $15 billion. We think that that TAM is available, and there are challenges to get there, but we have comprehensive coverage. If I look at the weight issue, that Josh mentioned, one of the things we see within these TAMs that makes it a little bit different, in electric vehicles to really hone in on is, an electric vehicle is heavier than an internal combustion engine vehicle. Batteries weigh a lot. That means these classes, which are really just based on curb weight, are a constraint actually in the market. We're used to looking at something that weighs less than 10,000 lbs and thinking about a certain payload capacity.
Especially at the border of class three and four, we see a lot a drive up into four from class three because of the need to have additional payload capacity, right? If your base curb weight is occupied by a few 1,000 lbs of batteries, you've got to have a higher available curb weight and move up into a higher class if you wanna have those payloads. We see that as, again, at the border between four and five, you know. Customers today are looking at our product that would traditionally have been in three. Now they're saying, "I need actually to be in four in EV." They might traditionally have been in four, and now they're saying, "I need to be in five in EV." Those border cases, they defy traditional classification. We're prepared for that.
I've made it simplified here, so in the first version, I had some overlaps. Hey, this is a three to four , but I wanted to make it simple today. We're conservative in looking at what the TAM is. The TAM is interesting, but there are a lot of headwinds in the TAM, right? We've got infrastructure. One of the things, the sayings I learned in China was, they say, "If you wanna build a factory, you gotta build a road." It's clever, right? If you can't do anything without infrastructure. The infrastructure problem in electric vehicle is probably the biggest tailwind for adoption. Range, sure, people talk about it. Cost, sure, people talk about it. There are solutions to those things. Infrastructure takes time.
Even with money available, even with the new government support from the federal government, it takes time and it takes knowledge. We're engaged with our customers, working on infrastructure issue, but we think that will continue to be a limiting factor for adoption, and we've scaled our business appropriately for that. We can be cash positive at relatively low market shares. That's critical for our long-term survival, and we think that that's a prudent measure. At the same time, we've built our production in such a way that we can flex up in capacity very quickly. We'd be very happy to be surprised that somebody figured out how to defy the laws of physics and build out a national infrastructure of electric vehicle charging in the next two years. I don't think we'll be surprised, but we will be as prepared.
We'll be prepared to deliver trucks as we are now through 2023, with new vehicles coming in at the end of 2023, with new variants coming in 2024 and another new vehicle launch in 2025. We'll be prepared to support our partners in education, understanding, and tools to manage their fleets and convert to electric. Our sales efforts. If I talk about sales again. On the slide I noted earlier, I didn't read off the slide, but really our efforts follow incentives first. I don't think anyone should be surprised by that. The cost of acquiring an electric vehicle is significantly higher than an ICE vehicle right now, until battery prices come down. Battery prices will come down slowly, we think. Continually, but slowly. Incentives are critical. California is the largest incentive market right now.
In our class, it's about $700 million that's out there in vouchers. That's a critical market offering anywhere from $40 ,000-$60 ,000 of incentive to convert a vehicle to an electric vehicle. There are big programs in the East Coast, too, the New York-New Jersey programs. There's about $80 million in those programs, with up to $100 ,000 in class six for an electric vehicle. Then in the central part of the country, I mean, I think you might be surprised to see that there are programs in Texas. $65 million for converting electric vehicles. Our initial efforts in sales follow incentives, but our business development follows a couple of other things. Significant large markets regionally. You know, the South is a huge truck market.
Over 500,000 trucks on the road today, including trucks headquartered at very large fleets. I think, you know, in the South, we have headquarters of both UPS and FedEx and Ryder. Those are massive fleets headquartered there, but managed nationally. In the Northeast, we've got the Penske fleet. That's a huge fleet, hundreds of thousands of trucks. In the West, there are large fleets, utility, as well as beverage and other fleets, and Amazon, of course, with their ever-growing mass of trucks. Focus on incentives first. In parallel, build up business development capabilities, engage with customers who are driven by ESG goals, as well as the economics of electric. When I look at the incentives, something very interesting is happening with incentives.
It's a huge market in California for in HVIP, their program, for zero emissions vehicles. Just looking at the vouchers that are out there, this comes from the HVIP website. This is from October. These numbers grow as more vouchers are awarded and trucks are delivered, if they're delivered. What we found is that trucks are not being delivered. 4,300+ vouchers out there. 93% unredeemed. You got 24 months to redeem your voucher. Who's delivering trucks? Nobody. If we look at the 298 vouchers that have been redeemed in that period, 211 of them were bus, 48 were step van, and the rest are basically tractors and a few utility trucks. It is a big market.
There are a lot of people sitting on vouchers who are not gonna get trucks in 2023 as well. We think those customers might want a truck in 2023, and we're very happy to engage with them and get them into a brand-new Workhorse vehicle. We're not just targeting new customer acquisition with the support of voucher programs. We're also looking at where is there pent-up demand by customers who have decided to convert to electric vehicles but can't get a vehicle. We think that's gonna drive additional demand for our products, because delivering a vehicle is critical to cashing in a voucher. What vehicles are we talking about? We started delivering the 4CC in September, with the launch of the 750 in January, with the demo vehicles. This is a Class four vehicle.
Again, we've seen interest in this vehicle as we talk to customers, and we are engaged with customers directly, getting their voice. Why are you interested in it? What do you wanna build on it? What's attractive about it? Payload. It's a Class four but has in a cab chassis version, a 7,000-pound payload. You can build pretty significant bodies on these trucks for lots of applications. We can put a large volume body on there for a package version that we're gonna do with the 750. It's called the 750. I think it's 784 cu ft of space, but 750 sounds nicer. Range, again, 150 mi. We think that that's a great range without building too much additional cost in for battery.
It's available. W56. This is the most important thing we're doing, when I wake up in the morning, I think a couple of things. I think, let me check my emails from the sales team. What's our progress on sales? Let me check in. Have we got any issues going on W56? Where are we on the supply chain stuff? I wake up every morning with Rick's voice in my head saying, "The only thing you need to do is design, source, build, and deliver trucks. Don't think about anything else." You know, I'm glad he could reduce it to such a small portfolio because that makes my life easy.
The W56, it's purpose designed, purpose built from the ground up, not around buzzwords, but around the practicalities and the demands of the commercial vehicle industry to be robust, highly reliable, high quality, and easily serviceable. A lot of the time and Benchmark that we put in thinking about how we're gonna build this complete vehicle is really also around, you know, how's it gonna get serviced and maintained? Can we remove parts easily? Can we remove high damage components that we know are often involved in minor things? You know, a truck drives down the street, what happens? It's the four corners, top and bottom that get hit and damaged and replaced. We've made it easier for our customers to fix those things. We're building 12 more vehicles.
I think one is we built a dimensional vehicle in Wixom a few months ago. We built the first program vehicle here last month. We've got two more building now. At the bottom right, I don't know if the video played, 'cause I wasn't paying attention to the screen, but that's a driving W56 with a secret body on it. You know, I think we thought we could do either the, the weird black and white camouflage on the vehicles, or we could just put an old truck body on the, on the chassis and drive it around. That's a driving program vehicle that we have running in Sharonville that shows that we're able to integrate all of our electronic components and our electronics and e-axle and drive a vehicle down the road.
That is the first W56 moving. We're going to introduce that at Work Truck Week on March 7th, you'll be able to come and see us, and come to the booth, take a look at the truck, get inside. There'll be driving versions at ACT to follow a couple months later, we'll start booking sales for that right after ACT. As I talked about, what is the product? It's more than just a truck. It's also software. We got comprehensive solutions behind the scenes for preventive and corrective maintenance, service software and remote diagnostics, parts replacement. You got to get the customers parts once they're out in the field. They will break down. Reporting for fleet and uptime.
Our customers need to know how the vehicles are running, optimize their drivers, behavior and routes, and, you know, making sure we have service level agreements through the entire network. We hold ourselves accountable. We hold our partners accountable. We make sure that the service levels are met across the fleet. Briefly, where are we at today? We're here in the ranch house. We love horse analogies here at Workhorse. You'll be touring through the barn later. That's 212,000 sq ft in our main production facility. We've got 163,000 sq ft in our main warehouse in the stockyard, all recently fully renovated. At the front of the property, we have our customer experience center. That's where we do our service fleet works there sometimes.
It's also where we bring customers to deliver trucks. They can have that experience of running through, here's how you operate, here's how you take delivery of your first vehicle, here's your high voltage training, et cetera. The Haymound, it's my favorite one of our names on the, on the property. The Haymound is our battery storage facility. It's separated for lots of reasons, most importantly being safety. We have to have a separate facility to store our lithium-ion battery packs, as well as separate fire control and humidity and temperature maintenance. Product plan finally. What are we gonna do over the next couple of years? W56 is in validation starting in Q1. We're building the program vehicles. This is on the road, in the wind tunnel, in the thermal chamber validation, real automotive testing.
That's going out through Q1. We'll have the market introduction in the middle of Q2 at Work Truck Week. Production slot booking starting shortly thereafter. The start of regular production for the short wheelbase version, that's the 178 that Josh talked about, is in Q3 of this year with the long wheelbase versions following a year after. The W4 CC, we'll do a 2023 model year refresh in Q1, as well as launching the Step Van and the W750. W Next, our next generation Class three, and as we talk about classes are interesting in EV for lots of reasons, Class three, four, a little bit of five maybe probably in that vehicle. That's in development now.
We'll go through prototype design, prototype builds through 2023, with validation coming in in 2024 with a launch and market introduction then in 2025. We will continue to launch new product and new vehicles through 20 23, 2024, and 2025. What are our advantages? Great product. More product coming. Designed for the use case. Designed to be robust. Designed to be flexible. Designed to be what the customer needs. Built with reliable processes, by a great team who's been trained in lean principles. With room to expand on that growth as needed. With an automotive-grade supply chain of reliable partners that come from the automotive industry, all run by a team of people who are committed to what they're doing, understand the objective, and are focused on execution.
I think that's really what we need now in what we're doing, which is more than just building a product to sell once. We're building an OEM. This is the birth of a new EV OEM here in the Midwest, and I'm very happy to be a part of it. Thank you for your time today. With that, I will ask my colleague, Stan March, to come up and talk a little bit about his business. Is that right?
No, John Graber.
John Graber. We'll talk about his business. Sorry. Went down the line.
That's okay.
Hey, John.
Thank you. My name is John Graber. I run the Aero organization. Thank you all very much for being here. What you just saw is what happens when you're a flyer working for a ground organization. I'm just teasing. I joined the company five years ago as a consultant to help it figure out manned aircraft it was building, and I helped it sell that business. I was asked to run the drone organization two years ago, and I've been the president of that organization for two years. Two years ago, I knew nothing about drones. Today, I stand in front of you, and I am a zealot. I am. There's something here that makes a lot of sense, and I'm gonna walk you through it so you can understand it. A little about me first.
39 years ago, I started in the aerospace business as a young Army helicopter pilot. It's funny listening to Rick Dauch and Stan March talk, West Point, Army Ranger, West Point Combat Engineer. These guys are so calm and collected about the jobs they do. Army Ranger, one of the hardest, most dangerous jobs in the world. Combat Engineer, one of the most dangerous things you can do is Stan March is talking about putting explosives together and how nothing could ever go wrong. I was a medevac pilot, and my job was to come pick these guys up when things did go wrong. There is a clarity that comes from that kind of mission, knowing that if you don't do what you need to do, things aren't gonna work out. Things aren't gonna work out well. Someone could get hurt.
I really enjoyed listening to Rick talk about trying to renovate this place this morning and help us, help the community and do what needs to be done here. I particularly like your story, sir. David, is that right? I love that story. I'm so glad you are here to see what this looks like because this is meaningful stuff. I am the airman in the surface organization, and everyone's asking why am I here? This is the answer. If you look at this picture, this is Workhorse, and I wanna make sure you understand this. That's not photoshopped. It's not retouched. That's a real picture of a real vehicle carrying a 10 by 10 by 8-in box that weighs 10 lbs flying over another real vehicle. They're both EVs. I focus on the one on top.
The rest of the organization focuses on the one on the bottom. This is what we're talking about, real stuff done really well that does real mission. Let me show it to you. This is why it's compelling. If you do this right, Josh is exactly correct. We are the ultimate electric delivery vehicle in the drone world. If you run a 10-pound package in our aircraft from Point A to Point B, you can run it on 95% less fuel than a comparable medium-lift diesel package truck like you see UPS, FedEx running around in your neighborhood all the time. 95% less fuel. Mark Twain said there are three kinds of lies, damn lies, and statistics. I know that's a statistic, but you can look at my site. It's true.
There's lots of research on how you think about employing an EV. This is a way. It works. This is why we're here, because the market really does demand that kind of efficiency. It's not just 95% less fuel cost. It's 84% less greenhouse gas. If you use a small UAV to move a 10-pound package, you can use 84% less greenhouse gas than if you deliver that same package in a medium-duty diesel truck. The stats are out there left and right. You can find lots of numbers, and there are lies, damn lies, and statistics, but order of magnitude, it's all there. I'm gonna talk to you about the total addressable market. We found two segments of it that are important, package and delivery, of course. Agricultural and infrastructure, data acquisition and data use.
We think those are compelling markets that are growing really strongly, and I'm going to walk you through those. To access those markets, we have built really high-quality stuff with a really good team that does what it's supposed to do. Most importantly, it's something the communities will accept because our equipment is quiet, reliable, and safe. As you think about what we're doing, the way Josh talks about it is exactly correct. We sell safety first, we sell reliability second, and then we sell the product. You have to be safe first, and you have to be able to go to work every time someone wants you go to work. If I have to sell you 20 aircraft to do 10 aircraft worth of flying, I'm not going to be in business very long.
I need to give you a reliable product you can rely on. You do that with people. I talked to you for a little bit about me. I want to walk you through this team because this is probably the best team in the drone space in the world. Let's start with Mike Gerdes. Mike Gerdes, if you look up capable pilot in the dictionary, his picture shows up. He has flown everything all over the world, every continent but Antarctica. He has taught in every heavy jet aircraft that you can think about. His last job was flying for Southwest Airlines, and he ran the training programs and the advanced qualification program to teach their pilots and flight attendants how to do their jobs. He's a remarkable operational individual, and he runs our flight operations, and he runs our engineering organization.
The reason it's important to have those two things together, if you've ever been an operator or you ever been an engineer, they point at each other a lot saying, "You really screwed that up." To have one guy over both organizations really helps rub the rough edges off so they can get things done. Jarod Patton works for Mike as our Director of Engineering. Jarod Patton has a decades-long history in manned and unmanned aviation, both for the Air Force and the civil world. What makes him really available. What makes him really attractive to us is that he has extensive experience in beyond visual line of sight operations. Beyond visual line of sight is what our industry is going for to really make a difference in the future. Joe McCulloch is our VP of Supply Chain and Production.
Joe's last job was running a $750 million automotive manufacturing plant that made transfer cases for automatic transmissions every 22 seconds. What's important about that is that the first time I told that story, I said it was every 40 seconds, Joe said, "No, no, 22 seconds." That is who you want running your production organization. A guy who will argue with you about the difference between 40 seconds and 22 seconds. We are not going to make an aircraft every 22 seconds or every 40 seconds, the guy who's running our production knows the difference, that's really important. Rob Heber. Where's Rob? Rob Heber is my Director of Government Programs, another Army veteran, retired Ranger, has been deployed every hot spot in the world you can think of, has done really hard jobs.
What makes him valuable to us is he has been flying UAS aircraft in the military since 2021. He knows so much about the business that we're in and what we do from a DoD point of view, and we're proud to have you, Rob. Thank you for being here. Walt McClarty runs quality for us. I call him my curmudgeon. Walt's been doing this for over three decades, and he knows everything there is to know about aerospace quality. We have to work with the FAA. I'm going to talk about that quite a bit. We just submitted a quality manual to the FAA for their acceptance. They said it's one of the best they've ever seen. First draft, one of the best they've ever seen. My whole team produces work like that. My chief pilot is a young man named Ronnie Skipworth.
You will meet him today when we do our flight demonstration. Alan's claim to fame is he's been in the drone business for 10 years. Look at that picture. He's been in the drone business for 10 years. He started flying airplanes before he could drive a car. You'll meet him today. Kaylin Teemer runs HR and DEI for us. Kaylin is a retired Army Master Sergeant. There may be a theme there if you're picking up on the veterans piece. Kaylin has won award after award after award for high-performing teams in recruiting in the Army. She's just exceptional, and we're so glad to have her. Myron Wright, you'll meet today. Myron is working with us on regulatory compliance and developing our commercial pipeline. Myron retired in January as the President and Chief Executive Officer of UPS's drone airline called UPS Flight Forward.
Myron's a 37-year UPS employee before he retired. Myron started the first FAA-certificated drone airline in the United States. You'll meet him today, ask him whatever questions you have. Play stump the chump with Myron. In five years of setting this organization up, there's nothing you can ask. Tell him I said this. There's nothing you can ask Myron Wright that he does not know about the drone business. See if you can. I bet you can't do it. Chet Fuller, who runs commercial and sales for us, Navy. We had to have a token Navy person. There are lots of jokes I can tell about the Navy. I won't start. Ben, where Ben is our Navy guy in the room. I won't tell any Navy jokes.
Chet flew carriers aircraft for 14 years. After he left the Navy, he was the Chief Commercial Officer at Norsk Titanium, an additive manufacturing organization that builds additive manufactured parts for Boeing and Airbus and GE. Before that, he was the Chief Commercial Officer at Bombardier Commercial Aerospace. He was the President of GE Aviation Civil Systems for a long time. Huge commercial chops, deep understanding of how commercial operations and contracts ought to look. It's a really good team. This organization positions us really well to do the things that we have been doing and that we need to do in the future. The organization has been working on drones, as Josh said, for over five years, a long, long time.
We have, I'll show you, and you'll see them today, a family of two aircraft that are safe, reliable, carry a meaningful payload for a meaningful distance, and are quiet. They're really remarkable aircraft. We have the ability to deliver a package with a winch. We have the ability to deliver a package with a servo. The difference is, if you use a winch and I fly to your backyard, and lots of organizations are asking us to do this, I'll hover 30 ft over your backyard. We'll start delivering the package. If your dog is out and runs out into the backyard, we can see it with a camera, and we can stop the delivery. Then, I believe we're the only organization in the country that can do this, we can retract the package and fly away. You will see other organizations flying with winches.
They can't pull it back up. One, they haven't built that capability yet, and two, we have a patent on it. It's important. We have eight granted patents, 16 in work or pending. As I told you, the annoyance profile of the aircraft is exceptional. When you see it, I'll be very curious to see what you think. As we think about what we're doing in industry, our industry, we are displacing lots of traditional delivery methods. Walmart started doing this two years ago, and they have found that as their stores have drone delivery available for about six weeks, communities go from indifference to curiosity to acceptance to, "I'll wrestle you if you take it away." It's so important. Walmart's model has been, we'll charge you $3.99 for a drone delivery.
We are delivering within 30 minutes of the time you click it on your website often. For $3.99, one of the top 10 things Walmart delivers, wait for it, Hamburger Helper. That's what everybody says. You can't make this up, but that's true. Hamburger Helper, olive oil, cupcake foils. The things that improve your quality of life in the moment when you need your quality of life improved. It's not rocket science stuff. $3.99, it's what are WTP, what are you willing to pay? It's the Starbucks effect. $3.99, you're willing to pay $3.99 for 30 minutes if you don't have to get dressed and get in the car and drive somewhere. It matters. All that to say, there's something here that makes sense. To play in the field, you have to comply with the FAA rules.
The FAA rules say that you must be less than 55 lbs, you must fly less than 100 mi an hour, and you can only fly 400 ft high. That's why quiet's important. If you meet those rules, you can sell aircraft and operate aircraft in the National Airspace System. This is not for the faint of heart. This is hard to do. Cessna, Beechcraft, Boeing, Sikorsky, Bell. It's the same playground everybody else is using. My team grew up in this playground. We know it. We know it really well. It doesn't intimidate us at all. We know how to do it is hard. Once you do it opens up spare parts, service, and subsystem sales. What's important about that, we don't know it in drones yet because the industry hasn't figured this out. No one's done it to scale.
In the Boeing world, the Lockheed Martin world, the Bell world, the Sikorsky world, the money you make on support, spare parts, and subsystems is more than half of what you make in system sales. If we get this right, and we believe we will, we're not making toys, we're making real aircraft that do real things, most of the revenue stream is downstream. It's not from system sales. This is the aircraft you'll see today. We call it the HorseFly. Like Ryan said, we're all things horse. This product carries 10 lbs for 10 mi. It is exceptionally reliable. We have been in the FAA type certification process two years this month, and the aircraft is made to fly about 10 lbs about 10 mi.
That black thing you see on the top is a parachute recovery system so that if a motor goes out or it hits a bird or it hits a wind gust and loses control, it can parachute safely to the ground without hurting anybody. It's got our own patented winch on it. The hardware is important, but as important is the software. Metron Air is our software system that controls lateral, vertical navigation, flight planning, maintenance planning, and all of the systems control pieces required with the winch. Right now, it's too foggy to fly. I'm looking out the window. By the time we're scheduled at 1:00, it's supposed to burn off. If it does, you'll see the aircraft fly. When you see the aircraft fly, you'll see everything it does is automatic. There will not be anybody touching it.
We'll have a guy standing there in case something goes wrong to take control. He won't take control. You can watch him the whole time. You can say, "You lying bastard. I see what you're doing. I know it." You can watch. It won't. It'll be a completely automatic process. Out of that aircraft, we had the opportunity to build a second aircraft. Cincinnati, Ohio, is a sister city to Kharkiv, Ukraine. Rob brought us the sister city organization seven, eight months ago now, right, Rob? We've had lots of discussions about how we can help in Ukraine. We put together the same airframe, the same propulsion system, the same set of navigational capabilities with a much lighter setup, so we could carry more weight, more distance, and try to figure out how to help in places like Ukraine.
We came up with this version of an aircraft we call the Humanitarian Aid and Logistics Operations Aircraft. It's a Falcon by name. It's a HALO operation. Took us 142 days from the day we decided to do it until the time we feel that it, which was last week. You will see this aircraft today. If the weather burns off, you'll see it fly today. It is built for austere conditions. It is built for heavy use. It is built for. Had a phone call last week. Ukrainian Post Office is trying to figure out how to get pensioners' money to pensioners', people, retirees, right? People who need cash in Ukraine, they don't want to do it with a postman if they could help it. They'd like to do it without putting somebody on the street.
Those are the kinds of scenarios that we wanna help with. The neatest thing about this business is that we don't have to decide what people are gonna do with it. The use cases just keep coming. They come and come and come. This is an example of the TAM. This is the Teal Group. They published this report in 2021. This is the total addressable market between 2020 and 2019. It goes from the blue bars are units. The blue line is dollars. 3.5 million units in the world in 2020, over 6.2 million in the world in 2029, up to $18.3 billion total civil addressable market. Things like how does Ukraine move mail to pensioners? That kind of thing is what this is thinking about, okay?
There are two segments of this market that we believe are important to us. The first one is delivery. This is as pure. Who are my financial analysts in the room? Raise your hand. Okay, hockey stick, right? This is the pure hockey stick. You have never seen something as much a hockey stick as this, perhaps. The point of this is, as Ryan said earlier, there are no trucks. Nobody's selling this stuff right now. The demand is going crazy. People want to buy it. They want the ability to deliver something safely, reliably, meaningful payload, meaningful distance. That's what's driving these projections. The example I'll give you is this one. That picture is from the Consumer Electronics Show last year. That's our truck, the truck Ryan was talking about.
Our patented drone operation and integration system on top, and our aircraft just took off from it. Real picture, again, not photoshopped. That's our product. This organization believes that their volume supports 1 million drone deliveries a day. Just this organization. 1 million drone deliveries a day implies, depending on how many flights you can make on an aircraft and range, it's all ConOps driven, implies tens of thousands of aircraft required to make those deliveries for this organization. You'll meet Myron today. Ask him about it. This is why they went down the path of being the first Part 135 drone airline, because they believe there's something there that will scale, and they believe there's something there that can make money and be of service. Every major logistics organization in the world is trying to figure this out. That's what drives the hockey stick, right?
A more mature market is agriculture. We've been working with the U.S. Department of Agriculture for over a year now to figure out how to get data to farmers. I'm not gonna spend a lot of time on this chart because it's not as dramatic as the other one, other than to tell you there's real addressable market here, right? We are working with the U.S. Department of Agriculture in the red states of Arkansas and Mississippi, and we're gathering data for them, and I'll show you that in a second. We're working with the states of North Dakota to figure out beyond visual line of sight operations, Michigan to figure out Unmanned traffic management operations. In the state of Ohio, we're signatories to the Smart 33 Corridor to figure out how to fly beyond visual line of sight with the Ohio State.
All of that work is to help move forward so that we can scale the industry. We're not the only ones doing a lot of this. It's pretty neat to see the community around us. There are lots and lots of organizations. We think we're doing it the right way. This is an example of data that we collect. This is pretty amazing. We're working with a USDA field office in Jackson, Mississippi. We're working with one in Arkansas as well. We went to this farm, and we scanned this data. They look at the data, and they say, "Oh, jiminy Christmas, look at that. That levee is weak here. We didn't know that was in the drainage path.
We didn't understand that the system is set up so that those trees are in the wrong place or that they put that little concrete structure in the wrong place. They didn't understand it because they had lidar data, but it was eight years old. It was eight years old because it's expensive. We're helping figure out how to lower the cost of this data so that agricultural experts can use it more often to make better decisions. This is an example of what we have done. On the left, you can see the half-moon scallops on that aerial. That's erosion. In the middle, you see a multispectral image on the left and lidar on the right. What the lidar is showing is a potential weakness in the pond structure.
On the right-hand graphic, what you see are obstructions in a drainage area that the USDA didn't know were there. Those are the kinds of things that if you get in front of it early, you can help farmers make their land more productive. You can help farmers figure out what the decisions ought to be as they apply for aid or decide what they're gonna grow, even what invasive species are out there. It is amazing what you can do if you can lower the unit cost of your scan and the data that you produce. How do we stack up? This graphic has a lot of numbers on it. Lies, damn lies, and statistics, right? Payload for our aircraft, 10 lbs. We can fly 10 mi, 45 min. We weigh 28, 23 lbs, depending on the commercial aircraft or the Falcon.
Our competitors average the numbers you see in the middle. I'm a pilot, so I can't do math. My financial analysis buddies will catch me on this. 90 is wrong. It's 82. Just wanna make sure I'm not trying to pull the wool over anybody's eyes. It's not a 90 number, it's an 82 number. Better than all of our competitors. What we are after is heavier side of the market, the more capable side of the market, the safer, more reliable side of the market. We think we're really well-positioned about this, the ability to do it. What's neat about this, I have a competitor that can't fly an aircraft within 5 mi of another aircraft. It's a limitation in their system. I don't know why. I couldn't care less. It's neat that they have it because it will never work commercially.
We can fly aircraft next to each other all the time, and we do it routinely. If you ever come down to Cincinnati, we'll be proud to show it to you. Rick said that we haven't started building yet, and that's true, but we do have a 75,000 sq ft facility that you see here. I put these pictures up in, on purpose. Two guys on the left in the upper left picture are A&P mechanics, licensed by the FAA to work on aircraft, do material work, sign things off. The guy in the middle with the glasses, and it's a terrible thing to say about your quality guy, but the guy who helps us with quality wears glasses, and he is extraordinarily good at understanding what works and what doesn't work in the field every day.
The guy on the right side of those three is a guy named Joe Sams. He has over 10 years' experience in drone assembly and management of drone production, over 10 years, and he lives in Cincinnati, Ohio. Specific requirements. Pretty neat. The two guys in the upper right-hand corner are two of our software engineers loading an aircraft. You can see the middle picture on the right, that is our production floor. If you come next month, you will see our first workstations there as we begin to put up our prototype workstations and then inventory down here for our prototype aircraft you see on the bottom. We anticipate being at a run rate of supporting 5,000 units a year in 2025. There's a real market here that we're selling into, and we know we can. This is a photoshopped picture.
I haven't been on the riverfront in Cincinnati with our aircraft, but this is our vehicle on the ground, our vehicle in the air. I'll just summarize by telling you, in the aero side, we have an extraordinary team. We have the ability to serve adjacencies to what the surface guys are doing. It makes all the sense in the world to be there, the addressable market is exceptional. We've built a really safe, reliable, and quiet set of aircraft. You'll see them today. We'll be delighted to have you in the shop anytime you wanna come. We're entering our regular production. This is the other typo, not Q1, Q2. Okay. That concludes my presentation. Stan?
Yes, sir.
I'm here not because I'm the next presenter, though I am. I'm here because I wanna tell everybody it's time to take a break. We've about 15 minutes. Let's return here at 11:05. You'll find coffee and breakfast pastries and whatnot in the room out here, and I mean, all of where the facilities are. Enjoy your break. We'll see you back here shortly.
Okay, we got a couple minutes to go. Just a couple minutes, so top off your coffees and mosey on back to your seats when you get a chance.
Okay, if I can ask everyone to return to their seats, we can get going here on our final hour together inside. Okay, welcome back. As brief introduction, I'm Stan March. I'm Workhorse's vice president of corporate development and communications. I guess you've already learned that I was a combat engineer for 12 years. After that, I spent 25 years working in complex international corporations, largely in functional areas. Some operations, but in functional areas, from quality to corporate development, M&A, public affairs, investor relations. That theme has stayed true because I pretty much do anything that Rick doesn't feel like doing, he sends my way. It was good training ground to come here. I came here from the bench.
In Alcandra, I was quasi-retired, and a teammate of mine that I met in 1979, who I'd never worked with professionally, when we were together at West Point, called and said, "Hey, I think I got something that you might be interested in." I came, and I met the team, and I said, "I don't know what it is, but there's something here." I think this morning you saw some of that thing that's here. It's a great team. It's an incredible experience. It's a small enterprise. We're working our tails off, but it's a great one. Anyway, what am I gonna talk about today? The Stables and Stalls. Stables and Stalls is a program which we announced and identified for everybody, really just announced just about, oh, a month ago.
It's Workhorse's approach to fleet electrification. Let me just spend for a moment on what fleet electrification means to us. We think it's an incredibly appropriate and frankly, smart thing to do to go out and understand the end customers for these vehicles that we're manufacturing and designing. Josh needs input from the field. Marketing studies are great. Driver studies are even better. We went out and developed a platform to serve independent contractors and operators. We created a subsidy that actually operates a FedEx Ground delivery route in Lebanon, Ohio. We took over delivery requirements in July. We're running that thing every day. Let me tell you, it's just hard dang work. It is really hard.
We got folks who were delivering 150 packages two months ago, delivered 220 a day, 240 a day. Do the math. You work an eight-hour day, you got 240 packages. You're doing 30 an hour. That's one every two minutes, right? That's a lot. You gotta move, go up and down stairs. Ergonomics is important. Downtime is important. It's a complex operation. We need to understand the people who actually do this stuff and make the decisions about what they're gonna buy and how they're gonna purchase, and what they think total cost of ownership really means. 'Cause right now, this is a really tough business. You see that vehicle on the top with a green X? That thing's got 400,000 mi on it. Drives like a mattress. It's a P1000.
I gotta tell you, it doesn't look that good now. The owners run those things as hard as long as they can. They change the oil in the parking lot. They jack up the front end and swap the brakes out in the parking lot. If the driver has a chance, he runs into the find a restroom facility in some fast food restaurant. It's really a very tough environment. You rely, we as a culture, rely on the delivery capabilities of these folks. We need to understand that group and help see if we can't make them more efficient. We like to also think it does the one thing we wanna do, which is help people buy our trucks.
We lease the maintenance facility, and the maintenance is gonna be in a central location instead of in a parking lot. It's a stable that's adjacent to the Lebanon facility. We've got our 10 trucks that we have in service. We just put last week, the truck that has the green X in it, that's a W750, the first of its type. It ran routes in Commerce last week. It electrified in one of the 10 electrification, level two electrification sites we've put in on site in Lebanon. We're delivering packages in electric vehicles for the first time with a Workhorse vehicle. We think that's a really big milestone and important, and gives us important credibility in this important marketplace.
While we're gonna electrify the balance of the fleet between now and through Q2 of this year, the other thing we're gonna do is work on what we think is one of the most important pieces and deliverables from this initiative. That is to put together a white paper and help independent contractors understand all the mechanics and all the dynamics, financial and operational, associated with doing a fleet electrification transition. A lot of talk about this, all kinds of consultant slides and firmware, flashware, vaporware out there, we don't know of anybody that's done it. If they have, we'll give them the credit, we're doing it, and we think we're the only one in the industry doing it. A little overview of the operation. We call it Stables by Workhorse as a branded name.
I think that's pretty cool. You might even recognize that Stables as a part of the W. We think it could be a centralized facility that you see right there, that's there in Lebanon. There's an associated supplemental piece of this, which is try to find a way to simplify the software journey that has to happen. I don't know if you all realize it, but when you run one of these vehicles, they have a suite of cameras on them that do everything from figure out when there's a harder left or right turn, an abrupt stop. They have cameras on the back and cameras on the front. That data gets fed and goes into your safety statistics. In addition to the delivery requirements, payroll requirements, driver training requirements.
In a tough business to hire people, by the way, this is entry-level hiring for many people, and we're competing with. It's really tough to bring people on, as Carrie well knows. We spend a lot of time talking about people. In some ways, it's been a really unbelievable educational experience. You saw the benchmarking that Josh was showing in the vehicles. We were able to bring our drivers in and participate in that study. Josh was getting real field input from people who really drive these vehicles to help design the next generation of vehicles. That's the kind of incubation we wanna do with this initiative.
We think it's gonna pay dividends, help us sell trucks, and give us credibility to understand our customers in a way that perhaps many, many others will not be able to do. By the way, you could say the targeted market. The targeted market for us right now is the FedEx environment. I'll tell you why in a minute. There's also opportunities. We've had conversations, I think, with a number of folks about around fleets, both government fleets. You know, state and federal government fleet opportunities, as, you know, from the Defense Department to other agencies. What are we doing in Stables and Stalls over the next 12 months?
What we're doing is we're gonna continue to work along the key identified deliverables, which start with launching the depot. Check that box. First electrified package delivery, check that box this last week. Transition ICE vehicles done by the end of Q2. Fully electrify the site. We've got 10 chargers in there now. We can build some more capacity, and we'll do that. Then we need to make sure we get the data, analyze the data, check the data, analyze the data. Data, facts, and trends are the things that we need to pay attention to. We're gonna test, monitor. We're gonna understand how to do fleet optimization when we can finally get Chris Dean, who's our supervisor, out of the seat and actually back to analyzing and managing the fleet and optimizing the route mechanics.
You'd be surprised, a lot of folks like to talk to you when you're involved in here. We've developed some really solid relationships within the FedEx organization that we think will pay some dividends in the future. The other thing we wanna do, you saw in Ryan's slide, and this is Chris is very focused on this. Incentive-based states have different mechanics, obviously, than non-incentive-based states. As we think about 2023, we need to think about launching another one of these in an incentive-based state. That will give us a white paper reference for both a non-incentive and an incentive-based state, and we'll be even more prepared to have a conversation with the appropriate folks related to how can you do this journey?
Well, that's really what it is, an electrification journey. Nobody that runs these vehicles right now has to buy their own fuel station, right? People who do it do what we had to do last week. Last week, I spent $2,500 repairing a transmission on a cutaway truck that couldn't move anymore. Well, it cost me $2,500 a week to lease a truck, so I had to pay the money to fix the truck. There won't be any blown trans, excuse me, transmission hoses on EVs. There are real benefits. The fleets are old. They need replacement. The maintenance costs are gonna come down. We just need to help them understand the dynamics of cost of charging and electricity, and that we will do. That's really what Stables and Stalls is all about.
It's a, I'll call it a incubator project or a proof of concept that we have underway. We'll be happy to share the details with you. We're not gonna publish the white paper for you, we'll share that with prospective partners. We think it's a really necessary and appropriate activity for us to be doing, that's why it fits in this catch-all portfolio that Rick Dauch has handed to me. With that, with that brief introduction to Stables and Stalls, I'm happy to talk about it during the Q&A. I think at this point in time, I wanna turn the microphone and the stage over to Bob Ginnan, our CFO. Bob can come up here and give you a little bit of a CFO presentation. Bob.
Thanks, Stan. Thank you. Well, good morning. Thanks, everyone. My name's Bob Ginnan. I'm the Chief Financial Officer. Prior to Workhorse, I was the CFO, then CEO of a network of private equity-owned RV dealerships, which gave me the chance to really understand the dealership side of things sitting across the table from the OEMs. I have good perspective as I've just switched sides of the table here. Prior to that, most of my career has been in manufacturing, mostly in public companies. It's great to be back in the manufacturing world here. Like Stan said, I was intrigued by not just Rick, but this great team that you've been able to see today.
In the spirit of the day, really focusing on people, process, plant, and product, I'm not gonna be a financial person up here and bore you with a lot of spreadsheets and financial statements and all that. None of that today. However, I do wanna say, as much as we've talked about the work we've been doing on the plant here and the process or the progress that you'll see on the plant, we've been doing the same thing on the financial side of the house, too. Over the last 16 months, the first thing we did was we got out of our debt. What that does is that really opens the flexibility for us for the future.
We can save some cash in terms of interest expense, and we can also invest our idle cash as well. That was a big first step. We reduced the cash burn. At one point, probably about 15 months ago, we were at $14 million-$15 million a month. Now we're down into this $9 million range, which is inclusive for us of working capital and capital expenditures in addition to operating expense. We put in place a $175 million at the market program. We know as we go forward, as we fund working capital, we're gonna have to continue to bring money into the company. We have that in place going forward here. We also worked hard to get rid of the old inventory and be able to reduce our footprint to one place.
In that process, we've also converted some of those inactive assets, whether they be scrap or batteries or real estate, into cash for the company here. Lastly, as Rick mentioned early in the opening day, one of the most important things is getting the shareholder lawsuit behind us. We were able to do that in a very efficient manner for the company. We were able to do that with cash proceeds from insurance policies and equity with no cash off the balance sheet other than we did agree to fund the legal expenses rather than turn those into insurance. That's been some of the major work this year.
Kind of to summarize, no debt, $120 million of cash at the end of the quarter on hand with additional capacity of $175 million. With a burn rate that is well within manageable area here as we move forward to actually producing trucks. As we look to finish out this year and move into next year, obviously this year has been the challenge with putting things in place, getting timing, getting supply chains, getting all those things done. We feel like we have the customers, the demand, the production facility and everything in place. We need some help with timing. For the rest of this year we're probably not gonna ship what we originally thought, but we are still gonna have revenue and just slightly lower.
We also expect, you know, we've been spending capital, but we don't expect a lot more. Next year should be roughly the same. We have to continue to invest in this plant. As Rick mentioned, we're putting in an ERP, and then we're also investing in our Aero and Stables and Stalls businesses as you saw from Stan and John. Our cash requirements should stay in the same range as we start to ramp into production. Working capital becomes the focus as you move past launch here. We expect, you know, 2023 to begin significant revenue as we really focus on growing these trucks and the W56 launch along with Stables and Stalls, and then really the Aero business coming into its own as well.
That's what we see for 2023. As we obviously get to our fourth quarter call in early March, we'll be in much better position to talk about revenue at that point in time. Okay? With that, I think we're give us a minute here. We'll get set up for some Q&A, and we'll let you guys do some of the talking for a while.
All right, come on up.
Thank you, sir.
Got it. All right. Make sure it's strong enough.
Yeah, thanks.
Yes, sir.
Can you hear me? The intent now is free Q&A. I'll be the emcee, and then I'll direct traffic to the people here, and we'll go from there. Any question's a viable question, okay? Go ahead.
Thanks. Sanjeev Varma from Lincoln, New York. I was just trying to figure out the positioning of the W4 CC. You know, we know that ELMS filed bankruptcy, so that particular vehicle was in the same segment. We have Rivian trying to make the same vehicles for Amazon. I'm just trying to understand how we are positioning W4 CC in that segment.
Okay, great. I think both Rivian and ELMS were a little bit lower. They were either Class one, two or three. Is that correct? This is really more of a Class four truck, but it has a payload capacity of almost a Class five truck. It's a unique situation. In fact, when Chris came, and she and I were out in the Midwest last week, and the customer we were with says, "There's nobody in the segment today who has a Class four electric vehicle that can carry your payload. You guys own the market right now. If you can get us trucks, we'll buy your trucks." That's a really good position to be in right now.
I'd say we brought customers into this site in December of last year, we showed them the W4 CC, and we showed we're gonna do a delivery van. They said, "Hey, we really want the cab chassis." One of our customers at the trade show is gonna show 23 different versions of our W4 CC with 23 different backends at the trade show in Indianapolis, we'll be the only one that's underpinning those trucks. Anything else you guys wanna say about that truck? Okay, great. Great question, Sanjeev. Others, fire away.
Tony here. This is actually for John Graber. I don't know if you guys have talked about this, but you all have been in FAA certification for just now two years. Has there been an update? Is that timeline of actually getting through the chute, has anyone gotten through the chute, and where do we stand?
Thanks, Tony. Good to see you. The FAA issued the first type certificate to Matternet three months ago for the M2 aircraft. There are nine others that are following behind now. We are gaining more understanding of how the FAA will type certificate an aircraft with every certification that they provide. They've never done it before. It's being certificated under this provisional regulation called Part 21.17(b). It's an arcane thing. You have to follow the rules that I put up on the slide to qualify. The FAA has taken over four years to do the first one. As Tony said, we've been in the pipeline for two years. We have not submitted our final paperwork because we're waiting to see what Matternet, Zipline, and some of the other organizations are granted before we do.
As soon as we get clarity on that, we're positioned to move forward. We think it will take us much less time than it's taken the original 10. I can't tell you how long yet.
John, can you clarify for some of the people in the audience, including me when I first got here, different types of certification Part 107, Part 135, and what does that mean for us and what can we operate as?
Sure. Today, if you see a drone flying, it is most likely flying under a provision of the Federal Aviation regulation called Part 107. You can go out and get a 107 license. You can operate around your school, your house, those kinds of things. To pay somebody to fly packages for you, they have to have what's called a 135 certificate. Those are the things that UPS has, Amazon has. We're in the process of getting. To actually run an aircraft for hire, you have to be certificated under Part 21, and that's what Tony's talking about. The three big buckets of regulation that we deal with every day, 107 for operations, 135 for revenue operations, and Part 21 for aircraft certification.
When you talk to other drone companies, ask them if they have that much experience in FAA, right? Most of them don't. Most of the kids, I should say, kids. People that we met out in Vegas who were the CEO of the drone companies are, like, 22 and 23 years old, 24 years old, right? They basically left Georgia Tech or MIT, and they did drones, and now they started a company. Okay. John and his team together have well over 300 years of FAA flight experience, right? It's one of the great strengths of our company. People do ask us all the time, "Why do you have a drone company?" Hopefully, we showed you today it's delivering packages very efficiently, 95% more efficient than an ICE step van today.
John could also comment about I didn't believe it at first when I got here. I went down to the Floyds Fork farm down in Louisville. They took us through the numbers and why it makes sense for them. They know every single route here in North America, how it runs, how many miles it is a day, 60 mi, 70 mi, 80 mi, 90 mi a day, typical. There's a few routes, and every group is about 120. Somewhere along that route, they've got to take two or three left turns instead of a bunch of right turns. That takes them across a river or a bridge, and that costs them 20 or 30 minutes. Okay? You think about that out in the farm country here in Indiana or Illinois or out west across the Ohio River, Mississippi River.
You can shoot a drone across the river instead of getting tied up on the bridge and come back. As John said, that drone is automatic. It leaves the truck, it goes to its delivery site, it lets you know it's here, it delivers a package, it comes back, lets the truck know, "Please pull over, I'm five minutes out," and we link back together and go forward so. You've made me a zealot, too. Okay, that's good so.
Hey, hey, Rick. Thank you and good morning. I was hoping you could talk a little bit about the chassis market. You know, clearly this should be a huge opportunity for Workhorse over the next couple of years. Could you just talk about, you know, some of the shortages we're seeing in the industry, the decision to partner with a third party this year for some of your deliveries, and really as, you know, just given this facility's position as an early, you know, producer of chassis, you know, what that means for the company and how you guys can take advantage of that?
Yeah. Great. There's a lot of questions packed into that question, okay? Three of us will probably take it okay, basically over here. First and foremost, I drive back and forth from Cincinnati every other week, basically, and I drive by the Kentucky Motor Speedway. I see every single week more and more F-150s being piled up that can't go to customers because they're short parts. At one of the customers we were last week, they told us last week they got canceled 14,000 chassis from one of the big OEMs 'cause they don't have the parts to make them there, which means there's a ripe opportunity for us to fill some of those needs, as Ryan said, when they're not taking their H voucher. We don't have any right now near-term parts supply shortages.
We're barely just starting our production right now. I'm sure we'll have to wrestle through those. One of the things we did specifically is when we went to sourcing, Jim Peters is here, we said, "Source as much as you can within a six to eight-hour radius of our plant." Into Ontario, Detroit, Upper Midwest, out of Mexico is usually a day or two-day drive and that kind of stuff. We have majority of our parts for the W56 are coming from the Midwest or North America. Our batteries will come from China. They'll be put in a warehouse, and we'll store them here.
The current cab chassis we're importing was really a situation after about 90 days of us being here, Ryan and myself saying, "Hey, we're not sure that the vehicle we inherited is gonna make it and is viable." I've been open about this. The truck we built was costing us somewhere close to $200,000 a build, but we'd secured contracts for over 8,000 vehicles at a price of $75,000-$80,000. I turned to my old CFO and said, "I don't understand that business model. If I build 8,000 trucks, I'll lose $125,000. I think we go bankrupt." We had to shelf that pretty quickly.
I talked to Josh and the team and said, "If I gave you a clean sheet of paper, how long will it take you to design a truck from start to finish?" You said how many months?
20 months, Rick. 20 months.
20 months. We sat down and said, "Okay, if we have no truck to sell or the truck we can sell is losing money, what the hell do we do?" Josh came and say, "I know of a company. I know they have a vehicle." We got our hands on it, and we spent about three months. Ryan led the negotiations with Stan, and we ironed out the agreement with GreenPower, and we have GreenPower trucks coming our way right now. I was quite surprised, actually, when we sat down with the customers. We brought a customer from Canada and a customer from North America or U.S. here, and they both liked the cab chassis. They said, "We can basically buy every one you build." That's kinda where we're at. Anything else you want to say about it?
No, I think that, you know, the partnership there is specific as well. You know, we have certain rights and privileges that I think are unique, but as well, you know, we've invested significant engineering into that vehicle with our partner, so that, you know, what our customers get is unique, and is again, purpose designed for the specific market we're in. When we go to the model 23 transition early next year, we'll really start to bring in even additional content into that vehicle as well. It's been, I think it's been a fruitful partnership on both sides so far. As we see. If you look at the vehicle platforms, right? You talked about strip chassis.
There's basically a strip chassis, cab chassis, and then many body options. We're an OEM, we build complete vehicles, but we'll also offer strip chassis into the market. Strip chassis sales funnel is longer because it has to get into integration partners. Big fleets generally buy strip chassis 'cause they have a specific body they wanna build onto it. A little different market, a little different sales process, but we're ramping up both of those sales funnels, strip chassis and complete vehicle.
Good question, sir.
Hi there. David Johnson with D.A. Davidson. You've electrified the Stables and Stalls facility in a matter of months. Did you get any cooperation from the local utility or other fast-track preferences to make this happen? What should the timeframe be typically for a 10-15 unit fleet not owned by Workhorse to install 10 DC fast chargers and related equipment?
Great question, David.
That is a great question, David. Just let me give you a little, there's not a short answer to your question, so I'll give you a little bit longer. First of all, we don't have DC fast charge in there. That's a different kettle of fish, right? We have level two in there, which is more 11 kW to 19 kW. It's not up in the, you know, the high tens or up to the hundred. That has a different supply chain sometimes, and that can be constrictive. We worked very closely with the city of Lebanon, Ohio is a little different than many cities. The electricity provider is a co-op, a municipal, if you will, a municipal utility.
When you go to meet the general manager, you're talking to the person that you need to have the negotiations with. It's not like going to, I'll pick a company just as an example. You're not going to PG&E, you're not going to SDG&E, you're not going to, you know, AEP, right? You're going to the local utility, and what they care about is selling kilowatts, right? Making sure they have the infrastructure to do that. We were able to partner with the right intermediaries. You know, there's a lot of hype, there's a lot of training necessary to be bringing that in. We gotta make sure we work with the office park where the facility is to get the permitting to do all that, which includes the city.
It took us, you know, it took us probably from start to finish, it was a six-month project. There's a lot of paperwork to do beforehand. You gotta get things approved, you gotta get things ordered. When they come in, you know, the clay is tougher than you think. You gotta saw out the sidewalk. You gotta destroy all your vegetation. I don't need to give you all the drama. The point is, it's a long process.
When you throw in fast chargers, it's a completely different kettle of fish because when you bring in high loads and you need to bring in a couple 100 amps or, you know, more than that, you're talking about major switching gear, which is still suffering from a supply chain challenge. In our business headquarters in Sharonville, the back of the prototype shop is still without switching gear since we moved in in April, and we won't be up and running until February because we don't have the current load. The gear to do the switching is not available commercially right now. There's a supply chain challenge there. I guess the beauty of our model is we don't need the high capacity charging mechanics right now.
We sought this route out because it had the right characteristics for us to use for delivery, the right dwell times, the right they kept under that 150 mi target on a daily basis that, Josh was, and Ryan were speaking of. We picked a business that had the right operating model, the right geographic model, and fit well with electrification. Can't say it works for everybody, but our model is they go back and dwell at night, they get the charge, and they can go back and we don't need fast charge. As we think about, you know, offering additional capabilities, that's something we can consider, and it's on our roadmap. As to whether we get there or not, we'll see.
Good question. You know, we've, that's why one of the reasons we're doing it ourselves, right? Small fleet operator, typical fleet in America owns less than 50 trucks. Cost of the truck is almost double today what an ICE vehicle is. That's why the governments have the grants. Also there's the cost. There's not a diesel station down the street either. There is a diesel station down the street. There's not an electric charging station down the street, right? When you. I had a Tesla for a while. You get it, comes, somebody puts something in your garage, and you charge your vehicle at night. I lived in London. The biggest complaint from the taxi drivers was there's not enough charging stations in London.
They'd have to queue up for an hour and a half to wait to get charged, and then they only could go 60 or 70 mi. They're having to charge up once or twice, and their shifts went from eight to 10 hours a day to make the same amount of money, okay? Chris and I were at a conference in San Diego. Who was there? CARB was there. SDG&E was there. PG&E was there. There are incentive programs from the utilities that'll help you connect to the grid, and they'll also subsidize or pay for your charging stations, but you have to buy at least 10 to 25 trucks. Those are the kind of places we're looking at right now to go see if we can do, right? If we can prove it here in Lebanon.
In a non-incentive state, we should be able to go cut and paste that and put it in Southern California, New York, New Jersey area where there are huge incentives to move that way, okay. Which is these trucks are perfect fit for electric vehicles. They basically leave the station at 6:00 A.M., they're back by 4:00 P.M. or 5:00 P.M. They plug in, they sit all night long, they don't deliver at night usually, and they're ready to go the next day, right? It's a perfect fit for electrification to change from ICE over to EV. Good question, David. Other questions?
Yes. That's you, Jeff.
Thank you. I got a couple quick ones. On the port delays, is that all battery related, and why wouldn't it be a problem next year?
It's not a battery delay, it's vehicle related. We have 188 vehicles at three different ports, one on the East Coast and two on the West Coast, and we're having some difficulties clearing through the ports right now. Another I'll say growing pain of which we're birthing the EV company, right? We're confident that once those trucks will get here, just a matter of which day in December they're gonna get here, and then we gotta turn around pretty quickly in the plant and get them out to customers, so.
Got it. That's helpful. Then two other quick ones. I noticed no 2023 outlook other than rampant growth. You've got the three vehicles. It sounds like the two trade shows will be critical to build a funnel for you. If I guess I was a bit perplexed on why you would give guidance after the Q4 call if the vehicles aren't out in the wild. Like, where could you give us a sense of, like, how the order book's shaping up now and then how you anticipate visibility to build after those two events in March and May?
Yeah. You wanna take that from.
Sure. I think it's a combination of demand we already have in terms of how we put together the forecast and the guidance there. Then those shows will go to enhance the order books. Also if you remember the timing of the launch of the W56, you know, SRPs the third quarter, a lot of that will be filling the order books for. It won't necessarily be a calendar year timeframe too. I think for the calendar year we'll know pretty well, and then it's a matter of filling it up from there.
Got it. The last one, if you don't mind, is just a lot of people make claims around purpose-built trucks, and as you alluded to, a lot of specs and PowerPoint decks out there. Can you touch on the compare and contrast the W56 that was purpose-built versus somebody going and buying a glider, a Dana TM4 motor, Hendrickson suspension, and waving their wand and saying, "I have a purpose-built electric truck?
I'll let Josh take that question, then I'll come back. Go ahead.
Yeah. Thanks. It's a good question, right? When you first look at a W56, you say, "Oh, that's just any other truck." I think the real takeaway here is that, yes, it follows the architecture, but it really isn't. We made a lot of discoveries as we went through and looked at where are we gonna place batteries, how are we gonna do things. Hey, the traditional truck frame is really not set up for that. We had to do a lot of innovative thinking and analysis and simulation to determine here's the best way to do that, whether that's different structures in there, different arrangements of parts. You know, some of our earlier products were literally just that, and the 2015 product was really adding electric components to that. This is a completely different approach.
While it's a traditional looking platform, we've really rethought it from stem to stern to make sure, hey, we've dotted the I's, we've crossed the T's. The batteries are not exposed to excessive vibration or twisting. The thermal systems can adequately manage all the conditions we're gonna put it under. The gradability of the drive is suitable up through 26,000 lbs with no limitations. I think that's really the difference from the cut-and-paste conversions that we've seen up to this point.
I'm gonna go back to your order book question without tipping off hands on guidance in 2023. On the truck side, basically every vehicle we can get in here and we can turn around in this factory, we're confident we can sell in 2023. That's what the market's telling us right now when we go see customers, whether that's a southeastern customer, a northeastern customer, the government, Midwest, or the West Coast. Is that a fact? Yeah. As we've heard from more and more, you're the only game in town for Class four right now, so that's great. We need to run and run hard while we have that leadership because we won't be the only one in the Class four down the road, so. On the drone side, hopefully you got a better understanding of our drone business today.
John and his team have worked extensively for 5+ years to get this HorseFly right. We've had some success and we've had some successful failures. Is that a fair statement, John?
Yes, sir.
We've had birds crash. Luckily, we've had nobody ever get hurt, right? When I got here and I went down to Louisville and they said, "Hey, here's the specifications you must meet." It's like 2.5 Pages of specifications. John and I drove, we actually drove separately, but we talked on the way back. I'm like, "Holy smokes. That's a lot of work." He goes, "Yeah, that's at least 18 months of work." It's pretty much 16 months later, here we are, and we're right on the, on the verge of getting ready for a big demo day with a couple of the delivery package companies. Three of them you know by name or by initial. How's that? Okay.
On the flip side, we kinda stumbled into when I got here, we were only working with UPS. I asked John and the guys, "What else can you carry? If you can carry 10 lbs, what else can you carry on that bird?" You know, and he said, "Well, we could put lidar and camera systems on." Lo and behold, we land not one, but two grants from the U.S. Department of Agriculture. They're perfect applications for us, and our guys are out doing that. That's a drone as a service. That's real revenue. We were kinda shocked.
We had a banker come in a few weeks ago, maybe a few months ago, and said, "Hey, the drones are pretty hot right now." In fact, we just raised $81 million on a drone company which has $1 million of sales. I think, Jeff, you told me when I first met you, I've got $0.00 value in your stock at Workhorse for your drone business. What the hell are you doing in drones, right? Now I think hopefully you see some of the logic behind it. I didn't quite realize what we were sitting on when I got here. I understand now we have a diamond inside this company in terms of the drone business.
It is a real valuable asset for us. We think we are, as we showed you today on our slide, That's data, facts, and trends. We can carry more payload longer and farther than anybody else in the space right now. That's at least in the commercial space. Okay? One of our board members has been using drones for over 20 years as well. Rob Heber's been using drones since 2001. There's people out there knowing how to use these drones. We got to figure out how to commercialize them. As a young lieutenant in the Army, I had top secret clearance, and I got to go sign for a special top-secret device to put in minefields, and it was called a GPS system. It was literally a box this wide, this tall, and this thick.
Today, it's in your watch, right? It just takes time to take that defense technology and convert it into commercial application. We think we can do that on the drone side. Good questions. Brian?
Two questions. The first one on the Metron vehicle telematics. Just talk to us about, like, the feedback loop, the over-the-air updates, recurring revenue stream potential that's embedded within that. 'Cause a lot of your customers, there's a bunch of independent fleet management companies out there, but that's one of the capabilities, and perhaps that's coming as part of 2.0. The first one's on Metron. Just drill down there. The second one, just talk a little bit about the Tropos contract manufacturing, which I understood was gonna, at least you disclosed Q4 2022, up to 2,000 a year, three years, just how that's tracking and how that fits into the plan to help, you know, share the costs.
Yeah. Let me start off with, I don't think we've ever charged anybody for a Metron system, have we?
No.
We've always given it away for free. Somewhere yesterday between my drive from Cincinnati to Union City and back to the hotel in Richmond, I no longer have Sirius Radio, so I'm in big trouble for my fantasy football team this weekend, okay? Because my subscription ran out after I bought my car. Sometime today, I've got to stop and reload it. That's an opportunity. You want to talk about Metron? Either one of you guys talk about Metron in terms of what we can do from a business standpoint, so.
I mean, I'll touch on it just for a minute. We're not the only one out there who's put tech telematics on vehicles, right? It's an extremely powerful tool when you're learning about your vehicles, you're figuring out what you're doing, how those vehicles are operating, and it's really used most heavily by Workhorse in warranty service and support right now. That team is in there every day, and if I call up Tim Dunsmore or Michelle, they can tell me, you know, which vehicle's doing what and so on. That's, that's a firm basis, right? As we do other activities, as we look at what Stables and Stalls might teach us, you know, Stan mentioned the fact that Chris has to go in, and he has to use a company-driven software tool to figure out when he's gonna load packages.
He has to use a payroll tool. He has to use a driver tracking tool. They still don't have real good visibility of where their vehicles are at any given point. We start looking at that, we're uncovering all these other aspects of it that add into that Metron package in creative ways, where we think eventually we could get to the point of having a single dashboard where you could go and say, "Oh, which vehicles have I got a service ticket on? What's the status of those tickets? Where are my drivers today? What drivers are available to drive on trucks? What's changed in my routing and logistics? Have I trained the new guy I hired last week, and how can he get information on that vehicle?
How can we certify that he knows what he does with an online test or something like that?" There's a whole suite of package there. While I spend a lot of my time thinking about two, three, four years from now, how we might turn that into yet another potential, you know, future revenue stream. Right now, it's all focused on warranty and operations for what we do every day.
Yeah. I'll just add a little bit. I don't wanna beat a dead horse. Somebody was gonna make that joke today, so I thought I'd be the one. I, you know, I talked earlier about the product being more than just the truck, right? Of course, there are layers on top of base telematics that are potentially monetizable. But as a base unit, we need to be able to provide more to our customer than just, "Here's the keys." Nobody does that anymore. You have a fundamental portion of the product that is in the cloud as well. It's an electric vehicle. You need to understand state of charge, state of health, right? You can't pull a dipstick to get that. You gotta have a software platform that shows that.
If you're running multiple vehicles, you wanna be able to see comparisons across vehicles. How is the health of my vehicles? What's the difference? How does it impact my maintenance plans? Metron is both enabling the use of the product. It's fundamental to the product, and it's enabling potential product in the future. You know, Josh's job and, you know, what he thinks all the time about it and works with a really fantastic software team we have is, how do we put the infrastructure in place like this plant that allows us to build those platforms of the future depending on the business cases that come up?
Brian, I'd say, you know, my experience at Accuride was the best fleets in the world have the best data. They know what their tire pressure is. They know what their fuel economy is 'cause you're basically operating on razor-thin margins, and the guy who can get 6.7 mi a gallon is gonna always be the winner versus the guy who's getting 5.4 mi, okay? If we can help those fleets manage our trucks and their fleets better usage of time, don't have to charge the batteries. This is only a 60 mi route. You don't need to fully charge the battery because otherwise you start wearing down the battery. You only need to charge it to 80%, okay? Stuff like that. Which one of you guys want to cover Tropos?
You wanna talk about it from where you are in production standpoint, and then Stan can talk about what we did from an equity standpoint there, so.
Maybe I'll go first 'cause I got a simple part, it was just manufacturing. We've had a very good handoff from Tropos. Materials are coming in now. We've got the initial production area set up. It's in the factory. You'll see it today. Builds are starting. As we ramp up this year, we will deliver vehicles in the fourth quarter from the Tropos and then we'll be really, I think at rate early in the first quarter as materials come in. Like everything else, we've had supply chain challenges with Tropos as well. Great interaction with the teams on both sides.
really clarity around how, what, why, how do we get great quality out? I think we have good clarity along supply chain. We're ready for action.
Before you go to the Trop, we have one of the best supply chain teams. We brought in three to four people that used to work with us at American Axle, who know how to manage global supply chain network, SQD, materials, logistics, scheduling. The real secret in the Toyota Production System is what we call the value stream map. The time you take ownership of the inventory, the time you get rid of the inventory. Toyota's the best in the industry at that. In the auto industry, as you know, they turn their inventory 40x-50 x a year. Most guys only turn 20. We're gonna be more like a Toyota type manufacturing company here. We know when we take ownership of the parts. We know what our manufacturing process will be through the plant. We should be able to process plant.
With the W4CCs, we should be able to process through the plant in less than a day, put them into the bailment yard, and it's off our books and on the way to a dealer. That's pretty efficient use of capital, okay? That's the true lean manufacturing, not Kaizen and all that kind of. That's just buzzwords, right? We do that. Do you wanna comment about Tropos agreement we have?
Sure, before I do that, I think Tropos gives us an opportunity to get the kinks out from the manufacturing process. When we make those vehicles this month, which we will do, you know, more than 12 of them, it'll be the first time we've got, you know, a non-Class four vehicle coming out. It's an assembly operation, as you'll see, but it'll be the first time we've got a non-Class four, and it allows us to get the local colleagues, the local team members back into the concept of manufacturing. 'Cause they've been, you know, they've been getting a little stiff. As Bob likes to describe it's spring training, you know. We get a little bit of work going on there.
From a transaction as you point out, that's part of this as well. We took an equity stake in Tropos. We made a $5 million cash payment, and we received $10 million in equity for that as part of they basically pre-funded the per piece costs as we entered into the agreement, and then there'll be a true up on the balance, another $5 million they'll provide to us as we get further down the path. The ramp looks solid to the 2,000, not through it, but it'll be in 2024.
We got some growing pains between the 10s numbers we'll be doing this year and the 100s numbers we'll be doing next year. It's tracking really well. Just a shout out to them, they've got a real interesting product, which you'll see. They've got a really unique niche market. There's a lot of universities and campuses that target this. They've got very large, very large tech companies that use them inside their campuses for moving people, moving gear, fire suppression. You know, there's towns that are using them to move their workforce and the other gear. They're based in California, and they understand that market quite well. They understand the incentive system that's out there, and it's a, I'll call it a target-rich environment. They're doing well on the sales side.
You could always do better, but they're doing well on the sales side. The engineering's good. Supply chain, we've got a, we got a sticky wicket or two to work through. I'd say we have a good partner and a good relationship, and that we're looking forward to putting more of those things out next year.
I'm gonna jump on that a little bit. They have a dealership already out there that's already certified for HVIP. They've got extensive experience working with CARB, which is helping us learn quickly how to work through the California bureaucracy out there, I'll say. Two, as Stan said, they've already got leads, or they already have orders from some of the major universities on the West Coast, which is some of the sites that are gonna go full electric, you know. Whether it's serving pizzas or running things between dorms or athletic gear between sports fields, there's an opportunity for us to go out there and do some stuff out there. It's a really good opportunity for us. We're gonna follow up. Next questions. How about anybody from the local area? Come on, you know.
You have a kid, cousin, grandson, or granddaughter needs a job, you know, get the resume. You gotta pass the drug test. You know, that's not always easy sometimes these days, but, we need more workers to come here for sure, so. Yeah, go ahead. Yes, sir.
I'm the superintendent of Randolph-Macon School, your local school district here with Workhorse. How do you see you leaning into local school districts to navigate the employment challenges, I think that all organizations are facing right now?
I'll start with we better pay good wages and benefits, and then I'll give it to Ryan to talk about what we're gonna do to work with you guys in the community. How's that?
I spent a few years in Germany, and one of the things I learned over there was that they do a really great job early on in letting kids know that there are opportunities for careers outside of just going to college and paying off debt for 10 years when you finish. Technical skills, things that you need, like electricians, technicians, and factory engineers. When we look at workforce development, we look at public-private partnership. You know, the mayor and I have been talking, I think, since the first day we met about these things. We wanna work with local high schools. We wanna work with local universities.
Carrie and the team have done a lot of university outreach already to build these kind of training programs so that we can offer these opportunities, get them visible in front of kids, so they know, hey, there are great jobs out there.
That might be better suited for me, that I might really enjoy, and they don't require me to go and be bored in school for another four years and put up a bunch of debt. You wanna go and pay off your student loans till you're 35. You wanna buy your first house at 22 working with us. I think that's a great offering, and that's what we're building here in Union City with Workhorse. John, you wanna comment, like, what some of the things you're doing from an educational standpoint on your side of the business and where you're recruiting from down in the Mason areas?
Sure. The neat thing about our business, I have five degreed professional pilots who are alumni of Indiana State. I have one from Embry-Riddle who has a master's degree in flight technology. He runs our training program. I have four certificated, not all degreed, professional software engineers. I have lots of mechanical engineers and lots of embedded systems engineers. The neat thing about our business, the reason I brought up the five folks from Indiana State, we can take a high school student who has a good attitude and had an interest in what we do, and we can put them in the field as a visual observer with about 10 days of training, and they can work for a long time through the pilot ranks. My chief pilot is going to college now to finish his degree.
He's got 10 years of experience, but he's not a degreed professional yet. Didn't have to be. Doesn't have to be. Those are the kinds of things Ryan's talking about. We can employ our young men and women, particularly in the scanning industry, close to where they live without years and years of college education. They can certainly go get that, and we're delighted to have my five degreed professionals from Indiana State. We call them the Indiana State Mafia because they're always, you know, "Hey, we need more of these guys. We know this person. We know that person. We know that." That's fantastic. It doesn't have to be that way.
As our business expands and we're able to do more acreage and more scanning, we are very interested in partnering with local high schools and local community colleges and local universities so that we can do more with the people who live there. One of the biggest measures of efficiency in our business, scanning, not package delivery, but scanning, is how far the farm is from the hotel. If you have to drive four hours, the amount of time you can scan goes down. We think all the time about how do we hire local people who can do a lot of this work.
In places like Union City, in places like the county that we're in here across Ohio and around us in the rural areas we're in, as we scan more and more, we can do that with lots and lots of local young men and women, and we want to.
Carrie, you wanna take the microphone real quick and just stand up and talk about we're a new company. Most of us came from big companies. We're used to having co-ops, interns. You wanna talk about we're putting in place at Workhorse for co-ops and internships a little bit so.
Yeah.
Introduce yourself first. Okay.
I'm Kerry Roraff. I'm the Chief Human Resources Officer. We are in the process of building a college relations program, to include co-ops, summer interns, apprenticeships, where we're gonna partner with local universities. Between aerospace and commercial vehicles, we're looking at building those partnerships with professors and with the student body. We'll have a tiered approach and looking to bring on students. That's really part of our focus from a sourcing strategy, is to build out our early career talent profile.
We obviously have a lot of veterans here, you know. Where's Rob Heber? Standing there. Rob got out of the military last year. Is that right? We tapped into him. Was it this year? Oh, you were on terminal leave for a while, right? Okay. We've been able to tap in, and we're tapping into some of the most elite units in the Army who use some of the highest advanced technology in the Army, including drone technology. They're also experimenting with electric vehicles that they can put in behind enemy lines that are quiet, that have no signature. How the hell do you charge them when they're behind enemy lines, right? How do you get blood to somebody who's been wounded, but you don't wanna bring a helicopter in? John was a medevac helicopter. Bringing a medevac in draws attention.
If you can send a drone in with blood with our Halo, or you can send water or a space blanket so they can get through the night until we get medics on the ground to save their life, that's real, that's a real mission, okay? It's happening every single day right now in Ukraine, okay? It's happening in other places in the world right now. Our Halo has multiple applications, whether it's in a combat environment or it's in a, some other. On a mountain, someone broke a leg and we can't get to them, gotta get a mule to them tomorrow to get them medevaced out. We can keep them alive at night by bringing them some water and a space blanket to keep them warm. Those kinds of things .
Those are John says the applications coming at us like, hold on a second, let's just stay focused on that kind of stuff. Those two applications we talk about are delivering packages in two different environments and scanning fields. We didn't talk about one of the things the Ukraine government talked to us about today is, "Can you use your drones to come in and scan our farms this winter to figure out if there's any unexploded munitions on the ground before we start trying to plant our crops in the spring?" That's a real mission. Okay. Those are real opportunities for us that we think we can make a difference. Okay, other questions? Yeah.
I just thought I'd just ask a question.
12 months ago. About six to 12 months ago, you partnered with an ag company to kind of tackle the drone market in the ag side. You know, obviously a lot of military people, you know, in the C-suite and internally. As we think about that opportunity, which seems like it's accelerating by the day, does it make sense, as we did in ag to partner with, you know, an ag player, does it make sense to partner with other military entities just to kind of accelerate what you guys are doing on the drone side?
We can't comment. How's that? Does that, does that give you the answer? Okay. The biggest ag company in the country is USDA, right? They're the ones who fund everything, right? There's a big disparity between people who are running farms that are five or 10,000 acres and the, and the poorer farmers that are running 50 or 100, trying to make ends meet. If we can help those guys be different, that'd be great, okay? Humanitarian assist. When hurricanes come through and all the power lines are down, how do you get water to people? How do you, how do you survey what is really going on out there right now, right? Drones have those applications as well. Anything else that you wanna talk about? Okay.
I know you're gonna find this hard to believe, but we hit the bewitching hour, 12 o'clock.
I'd say if you have any other questions, grab us over lunch. You know, I think that you're gonna. The M.C., you wanna take charge of what we're doing from here on out?
I'll take charge. For those of you that are on the webcast, you're unfortunately not gonna be able to see the plant. When we sign off, we've put together about a four-minute video, and you'll be able to get, call it the virtual version of what everyone who's here in Union City will get. We hope you find it to be informative and at least give you some understanding of what we've done in there and give you a real look and get a chance to hear one or two of our folks talk about what they've been doing as we move into production. What we'll do right now is we'll shut down the webcast, and we will, for those present here, we're gonna have Laura's lunch in the back.
We're gonna go to the back of the building. We've got about 40 minutes or so set aside for lunch. Then we're gonna go from here over to the plant for the plant tour. Then at the conclusion of the plant tour, we're gonna do ride and drives. John, hopefully y-all of your wishing about getting the fog cleared worked, and we'll be flying today. That's the plan for the rest of the day. Thank you very much for joining us virtually. For those of you here, thank you very much. You're gonna be with us for a couple more hours. Thank you very much.
Great. Let's go eat.