Executive Summary / Key Takeaways

• Strategic Reorientation Towards Mandates and Money: GreenPower Motor Company is strategically focusing on the medium and heavy-duty electric vehicle (EV) sector, particularly school buses and Class 4 commercial vehicles, where government mandates and significant funding programs are driving adoption. This shift aims to capitalize on a multi-billion dollar market opportunity in states like California and New York.
• Differentiated, Purpose-Built Technology: The company's core competitive advantage lies in its clean-sheet design philosophy, producing purpose-built all-electric vehicles like the BEAST and Nano BEAST school buses and the versatile EV Star platform. These vehicles offer superior performance metrics, including impressive range and unique features like V2G capabilities and high Altoona test scores, setting them apart from converted alternatives.
• Operational Consolidation and Production Ramp-Up: GreenPower is actively streamlining operations by consolidating its California facilities into a single Riverside hub and significantly increasing production throughput at its West Virginia school bus manufacturing plant. These initiatives are designed to enhance efficiency, reduce costs, and improve gross profit margins.
• Acute Financial Challenges and Liquidity Needs: Despite strategic progress, GreenPower faces substantial financial hurdles, including recurring losses, negative operating cash flows, and an accumulated deficit, raising material uncertainty about its ability to continue as a going concern. The company's reliance on insider financing and recent equity dilution underscore its ongoing capital requirements.
• Nasdaq Delisting Threat and Share Consolidation: GreenPower is currently confronting a Nasdaq delisting threat due to non-compliance with minimum bid price and stockholders' equity requirements. A recent 1-for-10 share consolidation was implemented to address the bid price, highlighting the immediate need for improved financial performance and market valuation.

A New Era for Commercial EVs: GreenPower's Purpose-Built Approach

GreenPower Motor Company Inc. stands at a critical juncture in the rapidly expanding electric vehicle industry, carving out a niche in the medium and heavy-duty commercial vehicle sector. The company's core business revolves around designing, building, and distributing a full suite of all-electric vehicles, including transit buses, school buses, shuttles, cargo vans, and cab and chassis models. Unlike many competitors who adapt existing internal combustion engine (ICE) platforms, GreenPower employs a "clean-sheet design" philosophy, manufacturing vehicles purpose-built to be battery-powered with zero emissions. This foundational approach allows for optimal placement of battery and propulsion systems, enhancing overall vehicle strength, significantly improving battery weight distribution, and ultimately delivering a safer, more sustainable, and sensible form of transportation.

The broader industry landscape is undergoing a profound transformation, driven by a global push for greener alternatives and businesses seeking sustainable fleet options. Government mandates are a significant catalyst, particularly in the school bus and Class 4 commercial vehicle segments, which GreenPower has strategically targeted. These mandates, often accompanied by substantial funding, create a compelling market dynamic that differs markedly from the light-duty EV sector, where consumer choice, rather than regulatory obligation, dictates growth. For instance, California's Innovative Clean Transit Regulation (ICT) mandates a gradual transition to a 100% zero-emission bus fleet for public transit agencies, with all new purchases by 2029 required to be zero-emission vehicles (ZEBs) and a full transition by 2040. Similarly, California legislation requires roughly 10% of new Class 4 vehicle purchases by fleet operators to be zero-emission, escalating to 75% over the next decade, representing a multi-billion dollar annual market opportunity in that state alone. New York's School Bus Incentive Program, with its $500 million allocation, further underscores the significant financial support available for electrification. This "Money and Mandates" strategy is central to GreenPower's investment thesis, aiming to capitalize on these structural market shifts.

GreenPower's journey to its current position has been marked by strategic evolution. Incorporated in 2007 as Blackrock Resources Ltd., the company underwent several transformations, eventually amalgamating into GreenPower Motor Company Inc. in 2014 and uplisting to the Nasdaq Stock Exchange in August 2020. Early on, the company's revenue was heavily reliant on California's Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (HVIP), with one analysis estimating that 74% of its 2019 and 2020 YTD revenues stemmed from this program. This historical dependence highlighted the need for geographic diversification and a broader approach to funding sources. A significant strategic move in fiscal year 2022 was the partnership with West Virginia, leading to a lease-purchase agreement for an 80,000 square-foot manufacturing facility in South Charleston. This established an East Coast production hub, complementing its California operations and enabling a dual-coast manufacturing strategy to meet national demand.

Technological Leadership and Product Innovation

GreenPower's clean-sheet design is a fundamental technological differentiator. This approach allows for optimal battery placement and weight distribution, resulting in a low center of gravity for its buses, which enhances steering and maneuvering while also providing ease of access for maintenance without elaborate hoist systems. The company leverages global suppliers for key components, including "plug-and-play" battery packs that offer flexibility in using different cell manufacturers and chemistries, and off-the-shelf proven powertrains from companies like Siemens and TM4.

The tangible benefits of this technology are evident across its product lines:

• School Buses (BEAST & Nano BEAST): GreenPower is the only OEM manufacturing both a Class 4 Type A (Nano BEAST) and a Type D (BEAST) purpose-built all-electric school bus. The BEAST, a 40-ft, 90-passenger bus, features a 193.50-kWh battery system providing a reliable range of up to 150 miles and a TM4 electric drivetrain rated maintenance-free for one million kilometers. The Mega-BEAST extends this capability with a 387 kWh battery pack, offering a range of up to 300 miles and vehicle-to-grid (V2G) technology, which provides electric grid stability and community sustainability. The Nano BEAST, a 25-ft Type A school bus, is equipped with a 118-kWh battery system for a 150-mile range and also utilizes a TM4 drivetrain. Its ability to fully charge between morning and afternoon runs using a 19.2 kW Level 2 charger makes it particularly attractive for school districts with less robust charging infrastructure.
• Commercial Vehicles (EV Star Platform): The EV Star platform is highly versatile, serving as the foundation for cargo vans, passenger vans, shuttle buses, and specialized vocational vehicles. A significant achievement for the EV Star is its passing of the Federal Transit Bus Test (Altoona Test) with an overall score of 92.20 in April 2020, making it the highest-scoring medium or heavy-duty vehicle at the time and the only all-electric Class 4 vehicle to pass. This, combined with its Buy America Compliance, offers a substantial competitive advantage for purchases utilizing federal funds. The EV Star platform also offers advanced options like autonomous driving integration (AV Star) and wireless charging capabilities, with GreenPower aiming for 75 kW for both DC and wireless charging.
• Product Innovation: GreenPower's in-house R&D, complemented by engineering firm collaborations, has led to new product introductions such as the EV Star ReeferX, a modern refrigerated box truck built on the EV Star Cab & Chassis. The ReeferX is designed for mid to last-mile refrigerated delivery, featuring a lighter body for increased payload, high-voltage operation for energy efficiency, and a longer warranty, earning the EV Star Cab & Chassis the 2023 Green Car Product of Excellence award.

For investors, GreenPower's technological differentiation translates into a competitive moat. The purpose-built design and high-performance metrics of its vehicles, particularly in the school bus sector, position the company favorably in a market increasingly driven by mandates and total cost of ownership. The ability to offer Buy America compliant and Altoona-tested vehicles opens doors to significant federal and state funding opportunities, which are crucial given the higher upfront cost of EVs compared to ICE alternatives. Furthermore, the flexibility of the EV Star platform allows GreenPower to address diverse commercial needs, from passenger transport to specialized cargo, enhancing its market reach and revenue potential.

Competitive Landscape and Strategic Positioning

GreenPower operates as a specialized player within the North American electric medium and heavy-duty vehicle market, rather than a broad market leader. Its competitive strategy is anchored in its clean-sheet design and a focused approach to specific market segments. This contrasts with many competitors, such as Blue Bird Corporation (BLBD), NFI Group Inc. (NFI), and The Lion Electric Company (LEV), who may have larger production scales or a history rooted in traditional bus manufacturing.

GreenPower's unique position as the only OEM offering both a Class 4 Type A and a Type D purpose-built all-electric school bus provides a distinct advantage in the school bus market. This differentiation is critical as the number of EV OEMs with Class 4 offerings has been dwindling, creating a more favorable supply/demand dynamic for GreenPower. While larger competitors like Blue Bird and NFI Group benefit from established manufacturing scale and extensive distribution networks, GreenPower's agility in innovation and direct customer engagement can foster stronger loyalty and customization options.

However, GreenPower faces competitive disadvantages due to its smaller operational scale. As of Q4 2023, its annual production capacity was approximately 500-600 electric commercial vehicles, significantly lower than major manufacturers. This smaller scale can result in higher per-unit costs and potentially thinner margins compared to rivals with greater economies of scale. The company also experiences supply chain dependencies, particularly for specialized EV battery and component manufacturers, which can expose it to constraints and cost volatility. Historically, concerns have been raised regarding GreenPower's prioritization of general and administrative (G&A) expenses over research and development (R&D), with one 2020 report suggesting a disproportionate spend. While GreenPower has since secured a patent on a proprietary parking pawl for EVs, this historical context underscores the ongoing need for strategic R&D investment to maintain its technological edge.

Indirect competitors include traditional ICE vehicle manufacturers, whose offerings can delay EV adoption, and emerging technologies like hydrogen fuel cell vehicles. These alternatives can intensify price competition or offer different benefits, such as potentially faster refueling times for hydrogen, which could appeal to certain fleet operators. GreenPower's strategic response involves leveraging its purpose-built designs and focusing on markets with strong mandates and funding, which helps mitigate the impact of these broader competitive forces.

Financial Performance and Liquidity Under Scrutiny

GreenPower's financial performance in recent fiscal years reflects both growth and significant challenges. For the fiscal year ended March 31, 2025, the company reported revenues of $19.85 million, a substantial decline of 49.5% from the $39.27 million reported in fiscal year 2024. This decrease was primarily attributed to 138 fewer vehicle deliveries, notably the absence of EV Star Cab & Chassis sales to Workhorse Group, Inc. (WKHS), which had requested a pause in deliveries. Gross profit for fiscal year 2025 stood at $2.20 million, resulting in a gross profit margin of 11.1%, a notable decrease from 13.6% in fiscal year 2024 and 18.3% in fiscal year 2023. The erosion of gross margin was driven by lower sales volumes, negative gross profit from the GP Truck Body division, an inventory writedown of $530,675, and lower-than-expected margins from the West Virginia manufacturing operations due to below-capacity production.

Despite historical revenue growth from approximately $3.5 million in 2018 to nearly $39.7 million in 2023, GreenPower has consistently reported negative profitability. For fiscal year 2025, the company recorded a loss of $18.66 million, contributing to an accumulated deficit of $97.42 million as of March 31, 2025. Operating cash flow has also remained negative, with a $5.99 million outflow in fiscal year 2025. These persistent losses and cash burn have led to a shareholders' deficit of $1.61 million as of March 31, 2025, and cast substantial doubt on the company's ability to continue as a going concern.

Liquidity remains a critical concern. As of March 31, 2025, GreenPower had a cash balance of $344,244 and working capital of $8.11 million. The company relies on an operating line of credit with the Bank of Montreal (BMO), which had a drawn balance of $5.98 million against a $6.00 million limit and is a demand facility, meaning repayment can be requested at the lender's discretion. A revolving term loan facility of up to $5 million with Export Development Canada (EDC) is utilized to finance working capital for vehicle production, with a drawn balance of $3.59 million as of March 31, 2025. GreenPower has also increasingly relied on insider financing, with loans totaling $1.75 million from related parties subsequent to fiscal year 2025, often involving the issuance of warrants and common shares, leading to further shareholder dilution.

Outlook and Strategic Execution

GreenPower's management anticipates a "step up in our revenue from our most recent quarter through each of the remaining quarters this fiscal year." This optimistic outlook is predicated on several key operational and strategic initiatives. The West Virginia manufacturing facility is ramping up production, with a target to deliver one BEAST school bus per week, increasing to two units per week by April, alongside Nano BEAST production. The overarching goal is to consistently build and ship 20 units per month. This increased throughput is expected to improve gross profit margins by better allocating fixed overhead costs.

Operational efficiency is also being enhanced through the consolidation of California operations into a single Riverside facility. This move, expected to continue through the summer, aims to improve management oversight, reduce general and administrative (G&A) expenses, and contribute to better gross profit margins. The company has a robust pipeline of orders, including over 100 live orders and a qualified lead pipeline of more than 160 school buses, representing a potential for $100 million in revenue. Specific delivery targets include 37 school buses for West Virginia within the current fiscal year and over 20 EV Star passenger vans and Cargo Plus vehicles, along with 28 specialty vehicles for Canada, by the end of the calendar year. Analysts following the company anticipate a 71% climb in revenue in the coming year, suggesting a rebound after the projected declines in fiscal years 2024 and 2025.

Significant Risks and Challenges

The investment thesis for GreenPower is accompanied by substantial risks that warrant careful consideration. The most immediate and pressing concern is the going concern uncertainty, stemming from recurring losses, negative operating cash flows, and a significant accumulated deficit. This financial fragility is compounded by the Nasdaq delisting threat, as the company received a determination letter in August 2025 for non-compliance with minimum bid price and stockholders' equity requirements. A 1-for-10 share consolidation was implemented to address the bid price, but the underlying financial struggles, including operating and net margins of -89.96% and -94.27% respectively in fiscal 2025, remain.

Liquidity and capital access present ongoing challenges. The company's increasing reliance on insider financing, coupled with recurring equity offerings, leads to shareholder dilution. The operating line of credit is a demand facility, exposing GreenPower to repayment risk at the lender's discretion. Furthermore, the company anticipates non-compliance with the minimum debt service coverage ratio at the fiscal year 2026 end for its EDC term loan, as it has not generated positive EBITDA in the trailing four quarters ended March 31, 2025.

Execution risk in ramping up production and converting its sales pipeline into revenue is significant. While management has outlined clear production targets for West Virginia, achieving consistent throughput and managing costs in new manufacturing operations is complex. Dependence on government incentives and regulatory changes remains a material risk. Historically, GreenPower's revenue was heavily tied to California subsidies, and while the company is diversifying, delays in federal funding programs, such as the EPA Clean School Bus Program, have impacted revenue recognition. The charging infrastructure required by customers, particularly less sophisticated school districts, also poses a significant impediment to vehicle deployment.

Other risks include supply chain dependencies on single-source suppliers, potential product liability or warranty claims given the early stage of EV adoption, and the inherent volatility of the EV sector, which has seen GreenPower's share price plummet over 97% since 2021. Litigation, cybersecurity risks, and the ability to attract and retain key personnel also remain pertinent.

Conclusion

GreenPower Motor Company is strategically positioned to capitalize on the burgeoning market for electric medium and heavy-duty vehicles, driven by compelling mandates and substantial funding at the state level. Its commitment to a clean-sheet design and purpose-built EVs, exemplified by the BEAST school buses and versatile EV Star platform, provides a distinct technological advantage in a market where purpose-built solutions are gaining traction. The ongoing operational consolidation in California and the ramp-up of production in West Virginia are critical steps towards improving efficiency and profitability, with management guiding towards increased revenue and improved gross margins in the coming quarters.

However, the path forward is fraught with significant financial and operational challenges. The substantial doubt about GreenPower's ability to continue as a going concern, coupled with the immediate Nasdaq delisting threat, underscores the acute need for successful execution of its strategic plan and securing additional capital. While the company's differentiated technology and strong order pipeline offer a compelling long-term vision, investors must carefully weigh these opportunities against the considerable risks, particularly those related to liquidity, capital structure, and the timely conversion of its sales pipeline into profitable deliveries. The coming quarters will be pivotal in demonstrating GreenPower's ability to translate its strategic intent and technological leadership into sustainable financial performance.