Ultracharge, (ASX:UTR) CEO Kobi Ben-Shabat told InsideMarket, “I love this battery market.”
The lithium ion battery market which has set his heart fluttering, are being used in two and three wheel electric scooters.
“The deal we have signed with Blitz Electric Motors, an Israel-headquartered electric scooter company, is a big moment for us” Ben-Shabat told me from his Israeli office.
“The big car makers usually like dealing with big suppliers, but those deals take a long time to come to fruition” Ben-Shabat said.
“The two and three wheel market is very fast to convert to your battery, if they want it.”
Blitz bikes certainly seems to want Ultracharge’s technology.
Blitz sells electric scooters direct to consumers but has a strong B2B business in food deliveries, to companies such as McDonalds and Pizza Hut.
Blitz has signed a condition purchase order of USD$4m for the first 4 thousand batteries, in return for 1.5 year exclusivity in the scooter market.
Given Ultracharge’s battery technology solution will enhance two of the bike makers main models with greater torque, power and a whopping 100% increase in range, to a total of 200 km per charge, you can see why Blitz wants the jump on its competitors.
Ultracharge will initially manufacture the first few thousand batteries under licence in China, and assuming all goes well after the first delivery, they will be supplying about $15m to worth of Ultracharge batteries to Blitz over the next three years.
But what is really significant for Ultracharge is that first delivery, which should occur around Christmas according to Ben-Shabat, which will signal to the global scooter market that they are up and running.
The news that this small battery makers technology can not only pack a punch, but can deliver what it promises, could see a very bright 2019 for Ultracharge.
While we don’t hold any Ultracharge stock at the moment, we might be doing a little early Christmas shopping, when we think the time is right.
The InsideMarket Private Fund currently does not own shares in Ultracharge nor have we received payment from the company for this coverage.
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