Mullen Automotive (MULN) Stock Is Down 97% YTD. What’s Next?

The Mullen Automotive Inc (NASDAQ: MULN) stock price has fallen 97.1% since the year began as investor sentiment towards EV manufacturers turned negative. The EV sector has had it rough as firms have been forced to cut the prices of their vehicles to remain competitive, as industry leader Tesla led the pack.

However, Mullen Automotive is yet to start producing its EVs at scale, with the initial commercial production run scheduled for July at its Mississippi production facility. The company’s shares have fallen significantly to erode all the gains made after May’s 1-for-25 reverse stock split.

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The EV manufacturer today unveiled a plan to integrate AI-powered PERSONA vehicle technology into its overall commercial and consumer vehicle lineups. The technology was initially developed for the Mullen FIVE but will be rolled out to all its vehicle models. 

PERSONA is an advanced interactive AI camera/sensor and video monitoring system that utilizes facial recognition technology to unlock/lock vehicles and completely personalize the overall vehicle experience for the driver.   

David Michery, CEO and chairman of Mullen Automotive, said: “Right from the beginning, when we first introduced PERSONA at the 2021 LA Auto Show, the amount of positive feedback we’ve received has been far beyond anything we imagined; so, of course, we had to expand it for additional use cases. We are actively working on the broad commercialization of this AI-based proprietary technology.”

Still, the question remains, will the latest announcement save Mullen Automotive from the ongoing depreciation of its share price? The short answer is no. Several critical reasons make it difficult for Mullen to escape its current fate. 

First, the company had $116.1 million in cash recently, inadequate to fund the scale-up of its production activities and the launch of its planned Mullen Five-passenger EV. Given how its rivals Rivian and Lucid Motors have performed, it is clear that the EV manufacturer will take a while to reach profitability. 

Therefore, investors in the company should wait for the upcoming 1-for-100 reverse stock split, which could provide more room for Mullen stock to fall further, eroding investor value. I would avoid the stock due to its fundamentals. 

*This is not investment advice. 

Mullen Automotive (MULN) stock price. 

The Mullen Automotive (MULN) stock price has fallen 97.14% this year and is due for a reverse stock split.