The bikes will be sold through RV-focused stores under the Tucker's Camping World brand. Photo / Supplied
Tauranga-based electric motorbike maker Ubco says it's set to more than double its revenue this year on the back of a big US deal.
Chief executive Katherine Sandford told the Herald earlier this week, "We hit just over US$8 million in revenue last year globally, and this year we're targeting just over US$20m - and a big chunk of that will come from the order we've secured from Tucker Powersports."
Tucker, which operates a chain of adventure sports outlets across the US, has placed a purchase order for 1500 Ubco bikes, which sell from $7499 to $7999.
The bikes will be sold through the RV-focused stores in the Camping World group. An RV is what Kiwis would call a motor home - only typically much bigger than those you see on our roads.
The idea is that an RV could be bundled with a couple of Ubco's 2x2 Adventure Bikes (Camping World will also sell an attachment rack), so you could pull up at a forest then do some off-roading.
The order is huge for Ubco. It equates to 1.5 times its full sales last year. All up, the firm says it's on track to sell 4000 bikes this year.
Ubco has also just launched a $5m raise on crowdsourced equity platform Snowball Effect. If it hits its target, investors have pledged to chip in the same amount and take the total raise to $10m.
US expansion is on the agenda. Ubco already has a significant presence in North America - home to roughly half its 100 staff - and plans to expand from 20 to 200 dealers in the US. Its regional headquarters is in Oregon (home to 20 per cent shareholder Evigroup) but it has also recently set up a supply chain team in San Jose, too.
Supply chains are, of course, a big deal in the age of Covid disruption.
Here, Sandford says Ubco has benefited from its tight partnership with its contract manufacturing partner, Taiwanese industrial conglomerate TPK.
TPK (which currently holds a 5 per cent stake) invested $14m in Ubco last year. As a shareholder, it now has skin in the game, and has created a production line dedicated to Ubco, capable of scaling up to produce tens of thousands of bikes per year.
More importantly, TPK - which had 2021 sales of around $5.3 billion - has the heft to secure supply of key EV components.
Sandford says having half the team in Oregon means Ubco can work on two projects at once.
It has a quad bike utility vehicle in the works, plus an upgraded 2x2 that will be able to hit around 80km - giving owners access to the sort of main roads that are not friendly to its current 2x2's top speed of around 50km (although a key benefit of the slower model is that in legal terms it's classed in the same bracket as a 50cc moped, meaning you don't need a motorcycle licence to ride it).
The new models will open new adventure bike and off-road markets, Sandford says.
Ubco has also had an eye on NZ Post's temperamental fleet of 400 Paxter four-wheel electric delivery vehicles, made by the Norwegian company of the same name.
Sandford has no timeline on new product releases, at this point, however.
For the time being, Ubco is still very much in the red. Operating losses outweighed revenue for FY2022 and are forecast to double in FY2023 before narrowing to close to breakeven in FY2024.
When will it break into the black?
"We expect to be profitable in the fourth quarter of FY2024," Sandford says.
It's possible that Ubco's next major financing step will be an IPO on the ASX. The public listing is possible in 12 to 18 months time, but the firm is still assessing the landscape.
Ubco also continues to pilot a monthly subscription service with Domino's. The pizza chain took on 25 of Ubco's 2x2 Adventure bikes on a monthly lease in mid-2020. It added another last year and is now operating more than 70, Sandford says.
The bikes all have GPS transmitters that feed mechanical and location data to a cloud-based dashboard developed in NZ by Ubco.
That allows corporate customers like Domino's to track the location of deliveries in real-time, and get instant alerts about any prangs that a driver, left to their own devices, might be too sheepish to report. A consumer version of the software works for farming families with multiple bikes via a smartphone app.
If you've been shopping for an electric motorcycle, you'll be aware there's been an explosion of options in the past couple of years, from traditional motorbike makers adding EV options to a welter of startups, including Zero and the Shanghai-based Super Soco, which has recently been pushing into NZ.
What's Ubco's selling point in the increasingly crowded field?
"We haven't found it that difficult to maintain a point of difference," Sandford says.
Doing some Ubco electric motorbiking around Hobsonville Point. On-road and (just quietly) a quick off-road blat around Bomb Point. Cheap, near-silent, green and a whole lot of fun. pic.twitter.com/mERf71G34h
— Chris Keall (@ChrisKeall) July 25, 2021
Many e-motorbikes are built for bougie-hipster tootling around town. An Ubco 2x2 can complete with optional decals but it began as the first electric farm bike, and it maintains that sturdy heritage with its off-road-friendly suspension and battery that can do double-duty charging powertools.
"We're very focused on what we do. We're taking the rugged, built-tough, utilitarian nature of the 2x2 and expanding the footprint beyond what's traditionally been quite farming-centric into the US adventure space," Sandford says.
She sees conservation and tourism as potentially huge growth areas for Ubco's environmentally friendly, quiet-running bikes.
2X2s are headed to Los Angeles for pavement inspections as part of an ongoing trial.
A new partnership with US company Chemix to create a cobalt-free battery should help to bolster Ubco's green credentials.
Eliminating cobalt should make batteries for EVs cheaper and reduce concerns about mining. Any type of battery innovation has been notorious for requiring long development cycles due to the sheer volume of possible experimental designs and the time-consuming nature of battery testing.
Chemix and Ubco will use AI to speed up the R&D process with "autopilot" simulations - as Chemix has already done in the area of pharmaceuticals.
Ubco puts the total addressable market for its bikes at US$50b today.
"And that will grow to US$150b over the next 12 to 15 years.
"And there's plenty of room for what remains our quite unique products that have the ability to off-road, but can also on-road."
She sees the Camping World tie-up bringing onboard new customers like couples and families.
"The opportunity is absolutely massive," Sandford says.
In May, Sandford was one of the business leaders who joined Prime Minister Jacinda Ardern on a jaunt to the US to drum up business for NZ companies.
Was it worth it?
"The PM's trade mission provided great exposure for Ubco in a key market for us," Sandford said.
"As is often the case, the relationships built on the trip were as important as those developed in the US and we're now reaping the benefits of that. It is clear that working together, NZ businesses can be a real force for good in the world."
Straker Interactive chief executive Grant Straker, who was also on the trip, is ordinarily a sharp critic of the PM and her policies but came away wowed.
"Many of us have had our moments on domestic policy but without a doubt, she is a superstar overseas. She's well-connected to world business leaders and that is very good for NZ businesses with the doors she can open."
Straker said Ardern would meet with the delegation before events and meetings.
"She would ask what we wanted out of it and she would work the room and narrative to ensure we got what we needed out of the trip."
Similarly, Sandford said, "Ardern's star shone brightly on the trip, her popularity evident at every stop. She was a strong advocate for New Zealand and for the businesses represented on the mission."
Ubco won the Pacific Edge Hi-Tech Emerging Company of the Year award at the 2022 HiTech Awards on Friday. See the full lineup of winners here.
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