Xos Trucks Is Going Public by Merging With the SPAC NextGen Acquisition Corp. (NGAC) in Q2 2021

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Xos Trucks, a manufacturer of fully electric Class 5 to Class 8 commercial vehicles, has become the EV player to opt for the SPAC route in order to go public.

As per the press statement released jointly by Xos Trucks and the SPAC NextGen Acquisition Corp. (NASDAQ:NGAC) just moments ago, the combined company is expected to have an implied pro forma market capitalization of $2.0 billion. Moreover, the transaction would provide $515 million in gross proceeds, including $375 million in trust and a PIPE investment of $220 million.

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Xos Trucks has developed a modular skateboard platform for its electric trucks, dubbed the X-Platform. The MD X-Platform pertains to trucks in Class 5-6 categories, while the HD X-Platform serves Class 7-8 EVs. The X-Platform can be configured to a wide variety of wheelbases and offers a range of up to 200 miles. This X-Platform is currently under testing in electric step-vans operated by UPS and Loomis in California. Readers should note that California is a very lucrative market for EVs in light of new CARB restrictions that are set to take effect in 2023 and would restrict commercial fleets bearing engines that were manufactured prior to 2010. Xos Trucks is also developing a Class 8 electric truck, the ET-One, which is expected to enter the production phase by the end of 2021. Finally, the company manufactures its own proprietary battery packs. Each battery pack contains local (independent) cooling, an integrated Battery Management System (BMS), and operates at system voltage, allowing for a truly modular battery system. The batteries are designed with a 200,000-mile useable life.


In a departure from the industry norm, Xos Trucks is utilizing a Fleet-as-a-Service business model that offers customers a comprehensive package of services, including telematics, service and support, leasing, and hardware charging. All of these services can be availed at a fixed monthly cost, allowing the company the opportunity to earn $11,500 as average annual recurring revenue per vehicle.

In order to save CapEx, Xos Trucks is utilizing flex manufacturing in its production facilities, allowing for the establishment of a complete manufacturing unit in a 150,000 sq. ft. area at a cost of $45 million. The truck assembly line uses 20 stations and can produce 5000 units per year. On the other hand, the company’s battery assembly line uses 6 stations. Xos Trucks is using Metalsa and Fitzgerald USA as its flex manufacturing partners.

As far as Xos Trucks’ financials are concerned, the company expects to earn a revenue of $271 million in 2022. By 2025, however, this metric is expected to swell to $5.2 billion. The company expects to start earning a positive EBITDA from 2023 and turn free cash flow positive from 2024 onward.