Kandi Technologies Group, Inc. (KNDI) Earnings Call Transcript & Summary

Greetings. Welcome to Kandi Technologies Second Quarter 2024 Financial Results Call. [Operator Instructions] Please note, this conference is being recorded. At this time, I'll now turn the conference over to Kewa Luo. Kewa, you may begin.

Thank you. Hello, everyone. Thank you all for joining us on today's conference call to discuss Kandi's results for the second quarter 2024. Earlier today, we issued a press release covering the results. You can find the press release from the newswire services. Please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the expectations expressed today. Further information regarding these and other risks and uncertainties is included in the company's public filings with the SEC. The company does not assume any obligation to update any forward-looking statement, except as required under applicable law. Additionally, unless otherwise stated, all figures mentioned during the conference call are in U.S. dollars. Before we continue, I would like to introduce the team joining me on today's call. We have Mr. Xiaoming Hu, Chairman of the Board. Dr. Xueqin Dong, Chief Executive Officer; Mr. Alan Lim, Chief Financial Officer. And for the first time on our call, Mr. Johnny Tai, CEO of Kandi America and Mr. Olen Rice, CEO of Northern Group. Dr. Dong will deliver his prepared remarks in Chinese, which I will then translate. Following that, we will have a Q&A session with Chairman Hu, Johnny and Olen and CEO to answer. Now let us start with brief screenings from each of our executives.

[Interpreted] Hello. This is Hu Xiaoming. Thank you for joining us today.

[Interpreted] Hello, everyone. I'm Mr. Xueqin Dong. I'm pleased to share our progress with you shortly today.

Good morning, everyone, and hello, everyone. This is Alan Lim. Thank you for joining us.

Hi, everyone. It's Johnny. Good to be here with you.

Good morning, everyone. This is Olen, and I'm excited to join the discussion today for the very first time.

Thanks, everyone. With that, let me now turn the call over to our CEO, Dr. Xueqin Dong to share our Q2 performance. Dr. Dong, please go ahead.

[Interpreted] Again, welcome to today's conference call. We are pleased to report that Kandi Technologies continued its strong growth trajectory in the second quarter of 2024. We achieved total revenue of $39.1 million up 8.9% from $36 million in the same period of 2023. The primary growth driver was our all-electric off-road vehicles and associated parts with sales revenue increasing by 11.3% to $34.7 million. [Interpreted] We made significant progress in our U.S. market expansion with the launch of new product lines, injecting new energy into the market. Additionally, through our exclusive partnership with Lowe's, the officially licensed NFL team golf carts will be launched in the U.S. starting from the end of August. This showcases our innovation and offers fans an eco-friendly way to show their team pride. [Interpreted] Our financial position remains strong with cash and cash equivalents, restricted cash, short-term investments and certificates of deposits totaling $219.6 million as of June 30, 2024. We actively executed our share repurchase program, buying back 673,896 shares at an average price of $2.25 per share, reflecting our confidence in the company's future and our commitment to enhancing shareholder value. [Interpreted] On the global front, we made significant strides, including securing EEC certification for our 10K All-Electric UTV paving the way for entry into the European Union market. In parallel, we have also opened up new markets for Kandi products in Asia, further expanding our international market share. Looking ahead, we remain focused on expanding our product portfolio and market presence, particularly in the U.S. and European markets, driving future growth through continued product innovation and market expansion. [Interpreted] Now I will -- we will move on to the Q&A session together with the Chairman, Xiaoming Hu; Johnny Tai, CEO of Kandi America; and Olen Rice, CEO of Northern Group, I will answer your questions. Ms. Kewa and Mr. Alan Lim will provide translation for English questions. Please go ahead and ask your questions.

[Operator Instructions] And our first question will be from the line of [ Joel Kramer, ] a private investor.

This is regarding new products, in the Q1 POR, the CEO stated, moving forward, we will launch new starter batteries as well as a variety of more competitive or electric off-road vehicle products and electric water sports products. Also from a press release, we learned of Kandi now selling its own branded lithium AA rechargeable batteries. Go ahead, Kewa.

[Foreign Language]

And from an outside article, we now see that a second version of the side-by-side e10K Cowboy called the Innovator e10K, along with the new $19,000 electric off-road vehicle called the Lucky 9, a few questions I have to ask. First, could you please explain what starter batteries are and how big the market could be. Go ahead.

[Foreign Language]

[Interpreted] Okay. The starter battery refers to the particular battery used to start a vehicle. We are still in a rather early stage of the R&D, and we are conducting the market research. According to the information available, the global automotive startup battery market sales reached the RMB 163 billion in 2023 and is expected to reach RMB 206 billion by 2030 with a compound annual growth rate of roughly 3.3%.

The next -- 2 other questions. What would be the competitive all electric off-road vehicle in the water sports product from the press release. And will Kandi soon be offering AAA along with the AA lithium batteries. And can these batteries use any size compatible charger, there must be a specific branded charger, Kandi charger.

[Foreign Language]

[Interpreted] So first of all, let me answer the first questions. The models you mentioned, those are related to our upcoming products in the future that are still under development. We expand into the UTV and water sports category, and there will be more product description and details in the future. The so-called competitive pure electric off-highway vehicles mentioned in the press release refers to the new generation of like the UTV, ATV, Go Kart and the golf cart models. Whereas the water sports products refer to the innovative single passenger electric Jet Ski. And then as for the second question, so basically, we launched the AA batteries to test the feasibility of the U.S. market. We have some -- actually and these were the first, and we consider launching the AAA batteries in the future. As for when to launch the AAA batteries, it depends on how well the AA battery performs in the market. Our AA battery is compatible with other charges and they are not limited to only the Kandi branded chargers of vehicles.

And the next question is, what is the difference between the e10k Innovator and the e10k Cowboy. And when would you expect them to be cleared for sale in Texas as the high end of Kandi's products at $19,000. What market does the Lucky 9 address? And lastly, several years ago, Kandi had a [ 9/10-scale gears ] trike motorcycle very similar to the Polaris Spyder, 2 wheels in the front, 1 in the back. It was seen that it could be a big seller for older biker wannabes. Any thoughts about Kandi bringing an electric trike version out. And any new vehicles expected to be released this year.

[Foreign Language] I'm sorry, can you repeat your second question about Lucky T9?

Yes. The gears trike, is that -- you had that years ago in your line, it was similar to the Polaris Spyder...

No, no. The second question you said as the high end vehicle Lucky T9.

Yes, high-end Kandi products at $19,000, what market does the Lucky 9 address?

[Foreign Language]

[Interpreted] So as for the question between the Innovator and Cowboy, from the product specification perspective, they are pretty much on the same tier. It's just the 2 models, they have different styling or outlook in order to target different customer groups, and that's pretty much the crux of it. The Innovator, as you may know, has a more fashionable appearance, and tends to attract the community with a better outlook. Whereas the Cowboy has a more outdoor style and is tailored for hunters and off-road vehicle users. Our goal is to expand the market for various [indiscernible] . And in that issuance, Cowboy is mainly sold in Lowe's whereas the Innovator will be sold in Costco in the near future.

[Foreign Language]

[Interpreted] So this product, as you may know, is outdoor sports trike. The market is really for those, the outdoor and the sports fans in the market. Thank you. [Interpreted] As for the models you mentioned in the past, those are the old model in our line, and we keep innovating and produce more up-to-date vehicles that match the target in the customers' segment market. Right now, we focus on the leisure outdoor off-highway vehicles. Thank you.

Our next question is from the line of [ Mark Cano ], private investor.

Let me introduce myself for a short time here. I'm a Swiss-based independent wealth manager and broker for 30 years and I have been in Kandi with several million shares in provision and the multiyear participation in these conference calls. I could never comprehend let alone expect to see the NASDAQ stock in such a strong and timely position at Kandi, trading at a 40% discount to cash, 65% discount to book value and at a 13 years low price. Kewa, could you just go ahead.

[Foreign Language] Go ahead.

Okay. On the last conference call, a discussion came up about Kandi targeting to spin off as a separate NASDAQ company, its U.S. subsidiary, Kandi America later this year. There was discussion that the most Kandi could spin off and maintain full rights of consolidation of financials is just under 20%. But to make this possible due to the NASDAQ requirements of a minimum price per share of $4 and $50 million market cap, Kandi itself would have to have at least $4-plus price per share to meet NASDAQ listing requirements for the subsidiary, but higher to assure the IPO doesn't go down on the first day of trading. What was suggested on the last call was for the company to just do a simple $10 million share tender offer at $3.50 a share, $1.50 under book value, costing no more than 50% of Kandi's cash. This announcement would call for an immediate increase in bids due to -- by traders, bidding at least $3 to $3.40 against the $3.50 tender price, which is still well under the $5 book value. Each share bought under the book value will increase the remaining book value per share by the difference between the purchase price and the book value. So if the non-selling holder gained $1.50 to $15 million in book value for each 1 million plus share purchase, it alone would be a great win. The response to this question on the last conference call from the CEO was, thank you for your suggestion and we really appreciate that. We will take it in consideration and evaluate and react and react properly. But remember, at the time that this was said with Kandi trading at $3. So do this even -- so is this even more -- now this is even more important. And there will come my questions now.

[Foreign Language] Go ahead with your questions.

On Wednesday, Kandi stock opened at $1.66 a share, the lowest price it has traded in the past 14 years. Does management know any other investment or use of cash better than spending 15% of Kandi average cash position held over the past 3 years. Then buying Kandi stock at a 30% discount to book value?

[Foreign Language]

[Interpreted] We understand that our stock is seriously and significantly undervalued, and we are increasing our budget in the marketing and advertising to promote our brand. Hopefully, it can attract more American investors. Thank you.

Okay. Does management still want to spin off Kandi America? And if so, does it have any better idea how to get Kandi stock price up to the price very quickly to assist this execution of the spinoff besides the marketing you just mentioned because in the past, there was already a lot of PRs and marketing. That was able to -- listing a little bit figures and this in that. So there was no big impact with this marketing on the stock price.

[Foreign Language]

[Interpreted] So we are considering the potential dual listing for Kandi America. But due to the SEC regulations, we are not allowed to discuss too much about this matter. Thank you for understanding.

Okay. Thank you for this information. So that means in my view that you're considering, and you have a quiet period for that. That's very good. Can you tell us a little bit more about the Monday announcement of the manufacturing agreement with Taiwan-based Hartford. Clearly, Kandi has plenty of excess manufacturing capacity in-house and normally would not need to add significant capacity right now. So either this deal is being done as inferred in the first paragraph of the Monday announcement, meets all necessary manufacturing standards regulatory requirements and local content thresholds for both U.S. and production in Taiwan. Or Kandi is going to need all its current access capacity to make and deliver enough product to reach its 2025 goal of $500 million revenue. Which is it? Or is there any other reason?

[Foreign Language]

[Interpreted] So expanding to Taiwan is a strategic move for us to enhance our supply chain. The main purpose is to add value to our existing products and further enhance and strengthen our market competitiveness. Thank you.

Okay. I understand. And my last question is, at the end of report today, you mentioned the Lowe's deal, which is quite important for you as a company. Maybe now specifically to the U.S. management team, has there been any discussions about the size of this deal? So how many UTVs or whatsoever and how many years this is going to be in the market this deal, that could give a very good insight for the future figures as the guidance.

[Foreign Language]

[Interpreted] We are going to have our CEO of Kandi America, Johnny, to answer your question. But if you can be more specific about what you'd like to know that would be really good.

Yes, of course. I mean if you're signing such a deal, Lowe's as well as Kandi, they must have some idea how many UTVs of this kind could be brought to the market or sold or being sold. Because Kandi has to be prepared production-wise and Lowe's has to be prepared distribution-wise. So I would think that there must have been some discussions about how many UTVs of these special NFL license utilities could be sold or the market is willing to accept.

Okay. Very good question. And I think I'm going to answer that first, and then I will invite my colleague, Olen, to weigh in as well. Yes, we do have like a discussion, regular meeting with Lowe's to discuss what the market looks like. And we understand the market is quite challenging right now with all the economic climate, such as inflation. So I think that we carefully review the market and then also, we determine how many stores, how many inventory we would like to bring in. So I think that's -- we still have a lot of discussions going on with Lowe's. And Olen, would you like to weigh in? Olen?

Yes, I was unmuted. You guys hear me?

Yes.

Okay. Yes. So to Johnny's point, we are in weekly several times a week, conversations with the Lowe's team just -- so as it relates specifically to the NFL, in a position where we got [indiscernible] everyone is excited about NFL as an obviously [indiscernible]. So we've got a plan. It's a 3-year long plan, that extended the contract [indiscernible]. And so we thought we are going down a path that would be [indiscernible] the market. To put a hard number on it right now. I would have a very hard time putting hard number. There are certainly very high expectations among all 3 [indiscernible] involved. Johnny, if you feel better about specifics, happy to do that. But I just don't know that number yet. And we do have very high expectations that could impact Kandi as a company. I'll stop there.

Well, thank you, Olen, I think, you are a little bit breaking up. But I think I want to make a correction. The NFL, we have -- we are licensed to sell from the golf carts. It's not the UTV. So right now, it's actually available to all the lowes.com. So I think, yes, I agree with what Olen mentioned. Thank you for your question.

Okay. Then that's it for me. Just yes. Okay. For just my last remarks for management, especially in China is there is a good company that's 1 side, and there's a good stock price. And these 2 things often don't match together. I think when it comes to company, the management has done a terrific job over the last years. They kept the company afloat and to strike good deals and to bring the company where it is today. But when it comes to the stock price, I must say that there they are a little bit lagging behind what -- for what reason ever. So I would say one could a little bit concentrate now a little bit also on the stock price for the shareholders and to make the stock a little bit in the public view that there's more attention about Kandi and what Kandi can provide and what Kandi can do, then the stock price could go significantly higher from the current position.

[Foreign Language]

[Interpreted] Thank you.

Operator, we're ready to take next question.

The next question is from the line of [ Steve Miller, ] a private investor.

Kewa, you said in your press release today that the United States is your primary market and that the increased freight shipping expense from China to service your expanding customer base was the reason for the biggest increase in your selling and distribution expense. Although I can guess as to the reasons for your recently announced partnership with Hartford Industries in Taiwan for manufacturing. Why don't you have manufacturing facilities in your primary market, the United States, especially as you contemplate spinning off Kandi America to be an independent publicly traded company.

Thank you. [Foreign Language]

[Interpreted] So we actually are considering an example of production like in the U.S. in the future. It's definitely in our plan. So the collaboration with Taiwan is one of a -- it's a strategy, and we may not disclose too much about that in this -- in any of these calls.

All right. I'm quite active [indiscernible] on social media, especially regarding Kandi. And there seems to be a campaign against Kandi by detractors on a lot of Internet chatboards claiming that Kandi is nothing more than a reseller of private labeling of its array of golf carts and various UTVs, ATVs, Go Karts, other off-road electric vehicles and even lithium batteries made by other manufacturers. As longtime Kandi followers are aware, this is a false narrative but easy for detractors to say since Kandi does not have a high-profile corporate website in English that showcases its in-house capabilities. Kewa, do you want to go ahead and translate that?

Okay. [Foreign Language] Go ahead, Steve.

So we all know obviously that Kandi stock is extremely undervalued especially even though it's a highly integrated major manufacturer. So a few conference calls back, a question was asked as to what percentage of the cost of a typical Kandi vehicle, for lack of a better term, such as a golf cart was actually manufactured by Kandi in its own multiple state-of-the-art facilities throughout whatever cities in China and now Taiwan. I believe at the time you said that a short management reply was somewhere around 90%. Could you go ahead and translate that? And I have got 2 questions.

[Foreign Language]

Now I've got 3 quick, related questions. Was that 90% response accurate, and if so, can you briefly tell us for the record about each of Kandi's owned various facilities, specifically where they are located, what kind of products are made in each facility and also, can you comment about the current percent of capacity being used in each facility and the maximum annual capacity available at each facility?

Okay. [Foreign Language]

[Interpreted] So first of all, the Kandi's Hainan base mainly produces the golf carts and other [ series ] of the models. Our Jinhua base mainly produced the UTV, ATVs, the beach carts and other series of models. Our Yongkang base mainly produces the motor and electronic control products and the parts. Whereas our Jiangsu base mainly produces liquid batteries and battery pack products. Overall, Kandi has an annual production capacity of more than 100,000 various types of the vehicles and related products. [Interpreted] And by the way, it's correct that our own manufacturing rate of the Kandi products does exceed 90%. Thank you.

Out of curiosity, I don't know if it is possible. If 1 was to go into a total replacement of your facilities and equipment, do you have any estimate of what the total cost would be in U.S. dollars that someone would need to invest to replicate all of your facilities and equipment?

Do you mean just any 1 of facilities or all of the facilities we are going to replicate in the U.S.?

All of your facilities. I'm just trying to get a sense of what it would take if some third party came in and wanted to do what Kandi is currently doing? What kind of cost would it be to them to replicate all of your current facilities and equipment without regard to where they're located.

[Foreign Language]

[Interpreted] So it seems from the pragmatic standpoint, it's not quite feasible to replicate the whole facility from China to U.S., although we are considering to have -- assembling part of the line in the U.S. in the future. Whereas the total overall budget, it's hard to tell now, and we have to look at some other detailed financial analysis report. Thank you.

Okay. Alan, I'm not sure if it broke up or I just didn't understand that 90% number back from your previous answer in terms of what percent of a typical like a golf cart is actually made by Kandi versus products acquired from outside is 90% still an accurate percentage?

It is. Yes, it is.

Okay. And then my last question is, your China-based website, quite frankly, seems to be outdated in that its images and videos are still heavy on EV autos and trucks. What about updating that site? And on all of your websites, and this is related to the previous questions, can you at least create a PowerPoint presentation on your state-of-the-art manufacturing facilities and capacity. So people who have questions about Kandi and in terms of how much you're actually manufacturing versus how much you're obtaining from third parties? And then putting on your label exists. I think that would be actually quite helpful and counteract some of the claims out in social media. And that's all I got. Thank you.

[Foreign Language]

[Interpreted] Thank you for your suggestions and feedback. They are very constructive. We have actually been working on already on just that in most of those items. And of course, we will further improve them to make it more accessible to our investors. Thank you.

Our next question is from the line of [ Fred Brasher ] with [ Cleantech Investments.]

With the existing outlets in North America, which we know include Lowe's, 2,500 outlets, Walmart, 4,500 outlets, Amazon, [ Campers World, ] Costco Canada, 108 outlets national big-box stores along with PV Mark/Ace hardware Canada 200 outlets. All but Lowe's added in the past year with maybe a 1,000 independent outlets with, unfortunately, little announcements from the company.

[Foreign Language]

Since the last conference call, it appears from sources several new international outlets have been opening to include a very impressive, which we talked about, Southeast Asia, Thailand location. Along with Aruba, Curaçao, Dominican Republic and Dubai. And even now in the EU market. Go ahead, Kewa, queue in my questions.

[Foreign Language] Continue please.

Okay. My question is outside of the U.S. and Canada, actually, how many international locations have been opened and are soon to be opened. In other words, a number or a close number. That's my first question.

[Foreign Language]

[Interpreted] So apart from our U.S. and Canada market, we are also exploring the European and Southeast Asia market. We are currently working in more than a dozen countries for the trial sales. Thank you.

My second question. In your travels have any multi-store chain been targeted for international growth? In other words, large stores chains like Walmart and Lowe's?

You mean internationally, outside of U.S., any...

Multi-store chains, big chains, big companies, big stores.

And outside of U.S.

Yes, for international growth.

[Foreign Language]

[Interpreted] So in U.S., we do work with those -- the large scalable retail or chain. However, in other countries, like the European countries, we actually tend to work with the distributors instead. And so that's our plan for now.

Okay. I have a quick question for Johnny, if we could. How many those stores does he expect the NFL carts to be involved with?

[Foreign Language]

Okay. Fred, nice to meet you. Thank you for your question. So for NFL right now, our plan is only available on Lowes.com. We do have some discussion with Lowe's to expand to their stores. However, I think they have to look at their space, availability and we know the holiday season is coming up. So their real estate is quite busy right now. So -- but it's -- right now, it's available on lowes.com.

Next question is from the line of Arthur Porcari with Corporate Strategies.

Well, I'm really happy to see that Johnny and Olen are on board here, someone that's been involved in Kandi since the very beginning. I also had the honor of being invited to come visit back, I think, 2020 or '21, whenever the K23 appeared, got to be the first shareholder who ever had a chance to test drive it. And I was very impressed at the time. Kind of disappointed that it never had a chance to go, but I can't blame you guys for it. What I can give you there was a lot of credit for what's happened since then. And I'm really happy to see Olen has joined you, Johnny. He's very capable partner and somebody to marshal our assets as investors. Anyway, let me get back to my original piece. I wasn't expecting you here, but look forward to maybe taking that short drive up to Dallas and visit you all again soon. And maybe meet Olen too, one time. Okay. Anyway, Kandi has an incredible relationship with Lowe's based on Lowe's seemingly unending support and trust of Kandi. Aside from the fact Lowe's picked up Kandi 2 years ago to launch their newest highest cost item in their system, only a few months after Kandi first entered the U.S. golf cart arena. However, initially, it was through marketing veteran [ Coleman ]. You only had 1 branded cart line back then. In less than a year, Lowe's has totally dumped [ Coleman ] point out of the picture, went directly to Kandi, picked up Kandi's own branded golf carts. The industry's youngest brand and as their sole golf cart supplier. And exclusively now show more than 80 variations of Kandi carts on their web portal. Just checked that the other day, just amazing. Go ahead and pass that on.

Okay. [Foreign Language] Please continue.

I will continue with the narrative, and then I have a few questions. Then just a few months later, Lowe's pays $100 million to renew and expand its 4-year relationship for the sole exclusive rights to become the official Lowe's home team sponsor to the National Football League and for the first time, Lowe's adds golf carts to their NFL sponsorship inventory. Coincidentally, this is the largest single big-ticket item that Lowe's sells nationwide by a double. But instead of bringing in any 1 of the more seasoned golf cart makers who would love to have had this account. They took what most would think was a risk to their reputation and picked the new kid Kandi and staked their reputation on it, plus they put up that $100 million. Pass that on, then I have some questions.

[Foreign Language] Please go ahead.

Okay. And again, appropriate that you have Olen on board for the rest of my questions here. In management's opinion, why did Lowe's pick Kandi and does Kandi's contract -- well, you already said that extends for the full remaining 3 years of the Lowe's NFL agreement, that part, I think you already agreed as it does. But in your opinion, why did Lowe's picked Kandi and Olen is probably the appropriate person to ask that question to.

[Foreign Language]

Yes. So thanks for the question. Obviously, Lowe's is like any of the major mass retailers. Has a very rigorous vetting process for vendor selection and product selection. And so over the course of that short window of time that you referred to, we became 1 of the key partners in the outdoor recreational space, particularly in the electric side of that space. And I think that a lot of that is due to our quality and the value proposition and high-level of trust that we've developed with that team.

Okay. Is Lowe's planning on including actual golf carts and/or 6-passenger carts. I asked that question after recently visiting [ Galveston ] beach cart rental business and the golf course, who would be happy open cases to buy a fleet of NFL carts even if they had to buy it from Lowe's, to put them in their rental pool.

[Foreign Language]

Yes. So I can answer this as well. We are currently a supplier to Lowe's with 6-passenger carts in a limited store count. A couple of hundred doors. We also have a very robust business with them online for that product along with a number of other categories that performed well online. And as far as future Lowe's commitments to product offering, particularly on the floor, that's something that I wouldn't want to comment on. Because that's kind of an always evolving process for these major retailers as they look at their -- the real estate they have available and what products make sense on their floor.

That wasn't quite my question. My question specifically had to do with the NFL. Again, you can imagine the [ Galveston ] cart rental company over here would love to have some -- I hate to say it Cowboys too, but Texan's carts to go ahead and let people go up and down the seawall. And as far as the golf course is concerned, they think it'd be quite interesting to have actual golf carts where you put the golf bags in the back. I mean this model that you have right now is a beautiful model, is 4P all forward-facing seats. But it's not really golf compatible and yet the sport of golf and border football seem to have some sort of a relationship over here, more so than most other sports, as you well know. So that was the basis of that question, actually.

Yes. Okay. If I understand your question, I mean, right now, the agreement is around 4P cart and any NFL products that are -- obviously that are going to be marketed via Lowe's because of the relationship. So I'm not sure if that answers your question totally, but that's our situation today.

But is it something that you might have an interest in doing or presenting for those to maybe have that or would be just too difficult to rekey. It seems like, basically, you're putting a wrap on an existing product that we already have and putting a logo, embroidered into the headrest and getting maybe a couple of thousand dollars more for the equivalent. It would just seem like -- go hand in hand and didn't know whether that had been in the discussion yet, but if not, maybe it's something worthwhile discussing that doesn't require a response unless you want to respond to it.

Listen, I'll say this. We obviously are interested in expanding as success for the program dictates. So I think that everything could be on the table. But at this point, we're so early into the program. I think we're going to play with the 4P and then I'm sure that there will be conversations if this is tremendously successful.

Sure. As we just discovered, this is a 3-year deal, which makes it that much more exciting. I'm sure it does for you as well. Anyway, on the last conference call, management responded to a targeted question originally asked on the conference call in 2022, confirming it still had a high-end goal of possibly achieving as much as $500 million in revenues for 2025. But I suspect that number certainly would have gotten lower now, but still a pretty aggressive number because of the economy in general. But that's a long way from $120 million or maybe $200 million, $210 million we'll do this year. Anyway, let's see, Lowe's -- I'm just looking at some notes I have over here. One other point I wanted to bring your attention, I guess you're probably aware of this, but they do, as I mentioned, they actually have about 80 different variations of your golf carts on the Lowe's website because you're exclusive in Lowe's. I'm talking about in general. But what's interesting is there are several hundreds of 5-star of the rating system on these golf carts. I don't if you are aware or not. But you have got an overall 4.5 plus rating if you add in all those. All the various, different Kandi provided products, which is pretty phenomenal and speaks very highly to the, at least the thought that the customers that have been buying the vehicles through Lowe's and that's a real feather in your cap. But anyway, go ahead and pass that on.

But what's your question?

Okay. Well, that really wasn't a question. I guess that was more of a comment that I had here and only kind of asked the first part. Let me see, I maybe have 1 or 2 more. I didn't see -- here it is, kind of prior things that were said. One of the questions I had was since Kandi is going to spin off Kandi America as a special separate entity, wouldn't it be wise to bring the CEO and perhaps Olen on the call in the future. But you all did that. So there you go. Okay. Let's see...

Let me translate what you have said so far. [Foreign Language] Okay. Continue with your question, if you have any.

Yes. Okay. Just a couple of more light ones over here. This is a follow-up on a question that somebody else asked over here and never sure we got the right answer for it or the answer that was understandable. Had to do with the total valuation of all of Kandi's facilities if they had to be replicated? Well, I remember for a fact that Kandi built from scratch the Hainan facility, which has the 100,000 capacity. And that was, I believe, 5 years ago, and that was done for about $200 million by itself. Subsequent to that, I know they sold the old facility and built a brand-new facility in Jinhua and I guess that's where they're making their off-road products. So it would seem to me that the value of all those facilities, which had to be replicated today, would certainly be in excess of $300 million, maybe a bigger number than that. Am I wrong?

You mean $300 million what?

Okay. Originally, the original Hainan facility was built for around $200 million by Kandi, 4 or 5 years ago and the new facility we have in Jinhua, which is, I guess, the 2 or 4, 5 facilities in various cities that are making vehicles where I believe they're making the Cowboy. I don't know what that -- what that costs, but maybe another $100 million or so. So my comment was, the question was asked about what the cost would be to rebuild that type of manufacturing capacity that we have. It would seem to me that number would be at least $300 million or higher. And am I right on that, or what?

Let me ask. [Foreign Language]

[Interpreted] It's very hard for us to tell at the moment because that involves too many products like the supply chain, the scale and other factors. But then we would like to think of that step by step. So that's our plan and consideration.

So you're not even willing to commit to the fact that the original cost of the facilities without taking all that other consideration. Well, I guess my question basically is, is it worth at least $300 million if you had to rebuild the whole thing again.

[Foreign Language]

[Interpreted] So just to answer your question, to replicate the whole, exactly same scale, same thing from China to U.S., it will be even higher than $300 million. But then again, it involves a lot of different factors when you do the manufacturing. Like the supply chain and other factors. It doesn't make sense economically to just replicate the whole effect. Something whole scale -- wholesale procedures in U.S. because it just doesn't work that way. Yes. But then, yes, that's our conclusion for that.

That was never my question. My question is the existing facilities that we have in China that are making all these vehicles that we are -- the companies being accused by the people on the Internet of farming out their building. If we had to just replicate it in China. In China, what would that value? What would it cost the company to replicate just the facilities in China. Forget about importing.

[Foreign Language]

[Interpreted] So in order to address your question again, you asked whether you cost more than $300 million, right? Long story short, yes, if we do exactly same thing. But just in the reality, we will -- we may not do it that way because, again, it's not how it works in the production in the cycle. But yes, in order to answer your question, yes, it will be even more than that. Just for information.

Okay. Very good. Okay. Well, I guess last comment I have here more of a comment than anything else. I have to admit, been in this business 51 years, never seen anything quite like this one, where you have a company where the stock is trading well under -- over $1 a share under cash in the stock market. Has gotten very little debt. Has a book value, it's trading $3 whatever it is or more under book value. And you just landed probably the [ cherry ] project that virtually any golf cart company in the world would be trying to get right now, which you have with the NFL/Lowe's, plus you have a sponsor like Lowe's and you got Walmart, you got the [ Campers World, ] you've got all these others, and the stock is sitting down here. You got to do something about getting the stock price up. I know even Olen is the second, I believe, the second largest shareholder in the company now. And if I'm not mistaken, I think, 1 year ago, he did a deal about $3.30 a share, you can't be too happy with that either. So we got to do something. And I think the only thing you can do in the United States is you've got to -- you got to do something very definitive. And if normal circumstances do want to deal with Lowe's would take any other stock up to $10 a share. We know this stock can actually do that because right after Kandi America was brought on board, the stock went up to $19 a share just based on that. And then they were doing $10 million in revenues. This year, you're probably going to do $150 million in revenues, just Kandi America portion or more. So that's just my final comment here. If anybody wants to comment on it, I appreciate it. But if not, we should have a great third quarter now. Because I guess you haven't done -- no revenues have shown up yet because you're starting now in August from the Lowe's golf cart -- I mean NFL program. So I would think we're going to have a great third quarter maybe I'm wrong, if anyone wants to address that or not. Anyway, thank you.

Thank you for your remarks. [Foreign Language] Operator, that's all.

I will turn the call back to management for any closing remarks.

Thank you again for joining today's conference call. If you have any further questions, please don't hesitate to contact our IR consultant [email protected], or you can contact us directly, [email protected]. We look forward to updating you on our next earnings call. This concludes our call for today. Thank you very much. You may now all disconnect. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]