MULN Stock Alert: Mullen Signs New Dealer Partner in Boston Area

Although circumstances were not favorable for the emerging electric vehicle (EV) manufacturer Mullen Automobiles (NASDAQ:MUL), the company continues to make great efforts. In the latest development, management signed a franchise agreement with Eco Cara car dealership in Boston, Massachusetts that specializes in electric vehicles. Still, there doesn’t seem to be much movement in MULN stock, whose price dropped following this news.

According to I’m looking for Alpha According to the report, Eco Auto is a zero-emission commercial vehicle dealer. As the electric car maker’s newest franchise dealer, “Eco Auto will cover nationwide fleet opportunities for the company’s full line of commercial electric vehicles, with a particular focus on the New England region,” the press release said.

In terms of units, the dealer’s initial orders include ten Mullen One vehicles (which are Class 1 electric delivery trucks) and three Mullen Three vehicles, which are designated as Class 3 electric cab-forward trucks.

According to David Michery, CEO of Mullen, “The New England region is a major hub in the Northeast for commercial fleet companies and we look forward to tapping into this area.”

It could be a bad sign for MULN shares

On paper, the contract is huge for MULN stock. The Eco Auto order shows that Mullen is confident about staying in business and supporting its electric vehicles. Still, the fact that MULN stock was choppy in the first few hours of Monday’s session could indicate deeper financial worries.

First, the Mullen One has an MSRP of $34,500. The Mullen Three, on the other hand, has an MSRP of $68,500. Even assuming the electric car maker can book the entire price as revenue, the total is only $550,500. That’s not enough to make a difference.

In fiscal year 2023 (ending September), Mullen generated revenue of $370,000 with a net loss of $972.25 million. And as of the quarter ending March 2024, the company posted a loss of approximately $2.06 billion.

The company’s free cash flow was last reported at $54.19 million below par. On the balance sheet, the company has only $22.38 million in cash and cash equivalents. Without more substantial news, the risk of dilution for MULN stock is high, which is likely contributing to its volatility.

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