What happened
Shares of Lightning eMotors (ZEV +0.00%) soared on Tuesday after the provider of specialty commercial electric vehicles announced a partnership with Berkshire Hathaway's Forest River. As of 2:40 p.m. EDT, Lightning eMotors' stock price was up a stunning 77%.
So what
The two companies will work together to deploy up to 7,500 zero-emission shuttle buses. Lightning eMotors will build fully electric powertrains and provide charging products and services to Forest River for the next four and a half years. The agreement could be worth as much as $850 million to Lightning eMotors.
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As the leading shuttle bus producer in North America, Forest River sells more than 10,000 vehicles annually. Its large-scale production levels will allow Lightning eMotors to offer best-in-class prices to its network of over 100 dealers.
"We'll be providing our customers with a factory-installed electric powertrain that has proven technology relied upon by major fleets, at a price point no one else has been able to achieve," Forest River executive David Wright said in a press release. "We believe this will be a game changer for shuttle-bus operators."
Now what
Many fleet operators have already begun to transition to electric vehicles as a means to save on fuel costs and meet environmental, social, and governance (ESG) goals. By helping to reduce the price tag of their fleet transformations, Lightning eMotors could help to further the trend.
"This has the potential to be the largest contract ever in the electric shuttle bus market, and we believe it will be the catalyst for other large commercial vehicle OEMs [original equipment manufacturers] and fleets to accelerate their adoption of commercial electric vehicles," Lightning eMotors CEO Tim Reeser said.
