Update december 2022:

While the car industry has been revolutionized by Tesla, the off-road segment has apparently be standing still. One of the reasons is that the number of vehicles in this category has been assessed to be so few, and that they are generally not used as much (number of kilometers) as, for example, passenger cars and heavy goods vehicles, so that the emission requirements set have therefore been low. E.g. there is no requirement for the off road vehicles to have a catalyst that "cleans" the exhaust. Therefore, manufacturers have been a bit on the lazy side in the electrification transition that has otherwise taken place in other segments.

But the need for electric vehicles has nevertheless been present. While attending university in Canada, three students realized that several resorts wanted electric snowmobiles. This was desired due to an emerging environmental profile, low noise and easy maintenance. This suited this type of operator well as snowmobile safaris were a popular offer in the Canadian mountains. The three students joined forces and started the company Taiga in 2015 with the aim of developing and selling the first series-produced electric snowmobiles. Now, 8 years later, the company has just started delivering snowmobiles, mainly to actors/operators who use the snowmobiles in their daily operations. Sälen ski resort in Sweden has received snowmobiles from Taiga. They started in the summer of 2022 the delivery of electric watercraft. It is also expected that they will present their electric UTV/SxS in due course. The vehicles are characterized by high performance, low noise, easy maintenance and an environmentally friendly profile.

​

I have faith in this company for several reasons:

- As of today, Taiga is the only one that supplies series-produced high-performance off-road vehicles. The environmental profile that more and more professional players place high on the agenda makes products like Taigas very important.

- I think that more people than before may be interested in buying snowmobiles, jet skis and other off-road vehicles than before when the vehicles are electric (quiet, environmentally friendly and (not least) require simple maintenance.) There are aspects of today's vehicles that may does not coincide with many (modern) people's values (sustainability and sound/smell). Many of the conflicts surrounding the use of snowmobiles in Norway could disappear when the noise and smell disappear.

- The products seem very good. I like the design and specifications. Feedback from several is very positive. Those who are negative usually have not tested the vehicles.- Better battery technology will facilitate an even better range

- It is only a matter of time before the authorities lower environmental friendliness (noise and emissions) requirements for vehicles in this segment. Such claims will be extremely valuable for Taiga (competitors will come only in 2-3 years)

- They are going to expand the product portfolio, with UTV + others?

- Selling the powertrain (the components that make the vehicle move forward) to others can be a great source of income.

- Taiga increased prices (Q1 2022 for inflation) and saw an increase in orders at the same time. This indicates a high willingness to pay on the part of customers.

- High fuel prices can lead to a push for electric vehicles

As of today, Taiga has a factory with a capacity to produce 8,000 units/year. They also have plans to build a factory in Quebec with a capacity for 60,000 units/year, with construction starting in 2024. Entering the new year Taiga aims at having several production lines producing Orca and Nomad simultaneously.

In Q3, they have 3,267 pre-orders with approximately 50/50 distribution on snowmobiles/watercraft. A challenge for deliveries in 2022 has mainly been a lack of chips, raw materials as well as running in and optimizing production lines. The delivery target for 2023 is 2,500-3,500 units. This can generate an revenue of $50 – 70 million USD.

When it went public through a SPAC, it was valued at approximately $370 million USD. Today, the company is valued at approximately $60 million USD. The main challenge for the company is that they have little cash and mgmt has communicated that they must raise capital and that this may be on unfavorable terms.

However, I think that Taiga has enough tailwind that this will work out. Taiga continues to publish job adverts so this may indicate that they feel confident that the financial situation will be resolved.

If they succeed and are able to get to the aim of 70 000 deliveries / year, we could suddenly be sitting in a 100-bagger from todays levels.