Arcimoto (Nasdaq: FUV)

Arcimoto, Inc.’s (NASDAQ: FUV) (“FUV”, “Arcimoto”, or the “Company”) makes electric three-wheeled street vehicles dubbed Fun Utility Vehicles (a.k.a FUV). Arcimoto’s story mimicked many other “tech 2.0” or “Tesla-lite” companies designed to benefit from increased consumer awareness and general city-wide roll-outs of docking station infrastructure for all types of electric vehicles.

In our opinion, Arcimoto lied to investors about its reported “pre-orders” from paying customers and disregarded safety concerns about its vehicles on public roads in order to execute a dubious stock promotion for self-enrichment at the expense of minority shareholders.

In March 2021 we reviewed six (6) different partnerships touted by Arcimoto since 2018. Specifically for these partnerships, we found that less than 5% of Arcimoto’s “pre-orders” were actually delivered.

As part of its fake demand promotion, Arcimoto’s largest customer, Arcimoto Key West, is secretly owned and operated by undisclosed related party insider FOD Capital, LLC (“FOD Capital”). As of July 2020, FOD Capital was FUV’s third largest shareholder. In 2H’20, FOD Capital sold 67% of its FUV shareholdings in traditional pump & dump style…

We identified another undisclosed shareholder who founded Hula Holdings, Inc. (“Hula”), a partnership that was announced in 2018 yet appears abandoned as of today. On November 10, 2020, Hula uploaded a new video of a different warehouse full of vehicles from Arcimoto’s direct competitor, Ayro Inc. (Nasdaq: AYRO, “Ayro”).

Perhaps Arcimoto’s most brazen stock promotion campaign example occurred on November 19, 2020 when it announced a 90-day trial period with the City of Orlando Mayor Buddy Dyer’s office as a potential first responder vehicle. The news fueled FUV stock price to skyrocket from US$ 9 to over US$ 20 within two days.

We were surprised to find that on November 18, 2020, the day before FUV’s Orlando 90-day first responder trial period was announced, Arcimoto filed a safety recall notice with the National Highway Traffic Safety Administration (“NHTSA”) in regards to possible immediate power loss on 100% of its delivered vehicles.

By law, FUV is required to notify customers of vehicles under recall so that the vehicles can be repaired, defective parts replaced, etc.

We spoke with Arcimoto Key West and GoCar Tours whose sales representatives both confirmed neither customer had been notified of Arcimoto’s November 2020 safety recall as of March 2021.

Arcimoto did not tell its investors that 100% of its vehicles were under recall the day before the City of Orlando first responder 90-day trial period announcement.

Elon Musk voiced his own concerns about Arcimoto’s FUV, crashing one himself into a wall and citing it as unsafe.

Electrive reported that Elon Musk crashed an Arcimoto 3-wheel vehicle into a wall in the fall of 2019, and that in September 2020, when a twitter user asked Musk for help with some projects with a video from Arcimoto consultant Sandy Munro, Musk responded succinctly:

“Can’t support three-wheeled vehicles. Not safe enough.” – Elon Musk

Since December 2018, Arcimoto has filed 19 separate recall notices, the majority related to the most basic elements of a vehicle such as power, steering and braking.

While its fun to make toys and sell them to your friends and family, it appears to us that Arcimoto’s commercial production is a pipe-dream since it had failed to produce a safe, reliable and properly working street-legal vehicle.

We are short Arcimoto ($FUV) and think that its stock is going lower.