Mullen Technologies’ future in Spokane is uncertain as the company plans an electric vehicle plant in Memphis

When Mullen Technologies announced plans to manufacture electric sports cars in the West Plains nearly two years ago, it promised more than 800 new jobs in Spokane County and the potential for more.

Now that future seems in doubt, as the California-based company has stated it has selected Memphis, Tennessee as the new home for an electric vehicle manufacturing facility.

Last week, the Economic Development Growth Engine for Memphis & Shelby County approved a $ 40.5 million tax break for Mullen when the company pledged to lease an 820,000-square-foot facility to manufacture electric SUVs from 2024.

Mullen executives said at the meeting with EDGE that the manufacturing focus has been changed from the Dragonfly K50 sports car to an electric SUV because it’s easier than starting new business in the electric vehicle segment with vehicles between $ 58,000 and $ 70,000.

“Mullen has been evaluating other locations for its assembly plant in its home state of California and has completed a new construction project in Spokane,” according to the EDGE term sheet at Mullen Technologies. “The Memphis area, however, offers distinct advantages over other options. The Memphis Option doesn’t require a time-consuming process of planning, financing, and constructing new buildings. “

Mullen has also purchased a facility 50 miles from Memphis in Tunica, Mississippi, which the company claims will offer “advanced engineering and manufacturing capabilities.”

“The Memphis location makes it a primary logistics hub for sales in the US and provides Mullen with important strategic advantages,” said John Taylor, Mullen vice president of manufacturing, in a statement. “The local and state administrations fully support our production plan and show their commitment with substantial financial incentives that will help us to grow with the city and the state over the next ten years.”

Mullen is silent about his plans in Spokane and has not responded to multiple requests for comments on project updates.

Memphis City officials declined to comment on whether Mullen has shown engagement with other sites on the proposed electric vehicle facility for the area.

In 2019, Mullen signed a letter of intent with S3R3 Solutions calling on the agency to build and lease 1.3 million square feet of assembly, research and development space for the manufacture of the Dragonfly K50 electric sports car in the West Plains. The facility would be funded through an income bond that will be repaid through the Mullen lease.

In the non-binding agreement, Mullen agreed to raise an equity investment of $ 50 million before signing a lease with S3R3 Solutions, formerly the West Plains Airport Public Development Agency.

Mullen should start assembling electric vehicles to get the car to market by the second half of 2020. The company was also keen, through Mullen Energy, to bring lithium battery research and development to the area and potentially increase the total number of jobs to 3,000.

Months went by when Mullen’s agreement with S3R3 Solutions was renewed and the company said it was raising funds for the project, including applying for a $ 450 million loan from the US Department of Energy to build advanced technology vehicles.

In July, Mullen announced that it would meet the letter of intent requirements with S3R3 Solutions by the end of 2020 and expected to begin assembling and developing the Dragonfly K50’s battery packs in a 500,000 square foot facility with the potential to expand another 800,000 square feet.

Mullen also announced plans to merge with Miami-based Net Element, a publicly traded electronic payments company. The reverse merger, a process by which a privately held company takes control of a publicly traded company, allows Mullen to acquire Net Element and bypass a potentially tedious process to go public and generate capital itself required to settle his deposit S3R3 solutions.

Todd Coleman, executive director of S3R3 Solutions, told The Spokesman Review in July that the agency’s letter of intent was unchanged and that the combination was critical to the funding needed to move the project forward.

However, Mullen collected more than $ 653,317 in late fees payable to Net Element due to a delay in filing a registration with the Securities and Exchange Commission. This emerges from a letter to the shareholders of Net Element.

Coleman said Spokane remains an option for Mullen Technologies’ electric vehicle manufacturing facility, but there are incentive-related challenges the company could receive compared to other states.

Coleman added that S3R3 Solutions also needs to consider incentives from other cities in Mullen, weighing that against whether it is in the best interests of the community for the agency to subsidize the electric vehicle manufacturing facility.

“We want to protect the community and we need to see that funding is available for them. We applaud them and their efforts to move this project forward,” said Coleman. “Vehicle electrification is not an easy industry and they have been very persistent in finding ways to fund the project and we will continue to work with them as best we can.”

Al French, Spokane County Commissioner who is also chairman of the S3R3 Solutions Board, said he has not spoken to Mullen Technologies since announcing plans to open the Memphis facility, but believes Spokane is a desirable area for the company is.

“The deal won’t be closed until the ink is dry, so we’re continuing to build an attractive business relationship with you here,” said French.

French said S3R3 Solutions’ recent contract to bring Amazon Air to Spokane International Airport shows its success in recruiting businesses in the area.

The construction of a rail and truck reloading facility in the West Plains, where shipments are shifted from truck to rail and vice versa, is expected to be completed this year. The transshipment facility would be suitable not only for Mullen but also for a variety of aerospace and advanced manufacturing industries to move cargo, French said.

“We’d love to be able to do the deal with Mullen, but if we don’t there will be someone else,” said French. “We have structured ourselves in such a way that we have no financial commitment. If they go away, it won’t hurt us financially. We’ll just readjust our websites and move on to the next company. “