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Electric chassis maker Xos Trucks agrees to $575M SPAC merger

Surging investor interest in electric vehicles sets stage to bring startup public

Xos Trucks is heading for public trading via a reverse merger that expects the company to have a $2 billion valuation. (Photo: Xos Trucks)

Electric truck chassis maker Xos Trucks is going public with blank check backing from a special purpose acquisition company (SPAC). Xos will merge with NextGen Acquisition Corp. at an implied market capitalization of $2 billion.

North Hollywood, California-based Xos will get $575 million raised by NextGen (NASDAQ:NGAC) . NextGen raised $335 million through an initial public offering in which investors gave NextGen a “blank check” to pursue a merger. Another additional $220 million came via a private investment in public equity (PIPE). 

The proceeds for Xos assume no NextGen investors redeem shares before the business combination is completed in the second quarter. If he merger goes through, NGAC shares would trade under the ticker symbol XOS.

Xos makes a customizable chassis with the wiring, battery mounting and axle-mounting systems for medium- and heavy-duty electric trucks. Its customers include United Parcel Service (NYSE: UPS), armored truck company Loomis and Japan’s Hino Motors Ltd., a subsidiary of Toyota Motor Corp. (NYSE: TM)


Xos claims a backlog of 6,000 orders, including an order for 100 trucks from Thompson Truck Centers, a subsidiary of Thompson Machinery, headquartered in Nashville, Tennessee. The two companies are targeting 1,000 medium- and heavy-duty trucks over the next three years. Most of the bodies are expected to be built by Morgan Olson, an Xos spokeswoman said.

Xos also offers fleet-as-a-service (FaaS), which for a fixed monthly fee bundles financing and maintenance. FaaS is projected to increase Xos’ lifetime revenue per vehicle. In a similar scheme, Nikola Corp. (NASDAQ: NKLA) plans to offer fuel cell Class 8 trucks, maintenance and hydrogen fuel for seven years for a set price.

Scaling opportunity

“Today’s announcement represents a major milestone that allows Xos to expand its vehicle and battery manufacturing capacity, advance our next-generation battery and vehicle control systems and put thousands more Xos vehicles on the road,” Giodano Sordoni, Xos co-founder and chief operating officer, said in a press release.


Xos began in 2016 as Thor Trucks. Its first prototype, a Class 8 day cab built on its electrified chassis, brought comparisons to the Tesla (NASDAQ: TSLA) semi introduced a few weeks earlier in 2017. The Semi has been delayed numerous times beyond its original 2019 production target. 

Xos gave up the Thor name in a trademark dispute with recreational vehicle maker Thor Motor Coach in 2019. Around the same time, it pivoted to focus on Class 5-7 medium-duty trucks. Class 8 trucks are on the back burner. But they remain in Xos’ plans, co-founder and CEO Dakota Semler told FreightWaves in a May 2020 interview.

“Our aim was to provide customers a superior alternative to traditional fossil fuel vehicles,” Semler said in Monday’s release. “As former fleet operators, we gained a deep appreciation for the challenges of operating and maintaining commercial fleets, particularly in light of accelerating emissions requirements.”

NextGen reviewed more than 100 merger opportunities before choosing Xos. The growth in e-commerce and last-mile transportation factored heavily in its choice.

“The strong secular tailwinds of climate change and e-commerce anchor our investment conviction in Xos,” said George Mattson, co-founder and co-chairman of NextGen and a former partner at Goldman, Sachs & Co.

“Climate change is one of the world’s greatest challenges. And commercial trucks are the largest emitters per capita of greenhouse gases in the transportation industry,” Mattson said.

Semler and Sordoni, along with Chief Technology Officer Robert Ferber and Chief Financial Officer Kingsley Afemikhe, will continue to lead Xos. Semler and Sordoni will be company directors along with Mattson on a newly formed board of directors. NextGen promises Xos guidance in strategic, operating and governance experience.

“Based on our work, we believe that Xos is best positioned to capture the rapidly growing demand for commercial electrical vehicles with a compelling customer offering,” said Gregory Summe, NextGen co-founder and co-chairman.


Summe is former Chairman and CEO of life sciences company PerkinElmer Inc. He also was vice chairman of the Carlyle Group private equity firm.

The Xos discussions with NextGen were first reported by Reuters on Feb. 8.

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Click for more FreightWaves articles by Alan Adler.

Alan Adler

Alan Adler is an award-winning journalist who worked for The Associated Press and the Detroit Free Press. He also spent two decades in domestic and international media relations and executive communications with General Motors.