ZENN distances itself from EEStor in latest earnings report
ZENN’s third-quarter earnings aren’t looking good, and neither it seems is its relationship with EEStor. I can only speculate, of course, because the company is saying squat, but the language of the press release gives us a few hints:
The company is “developing high-voltage drivetrain solutions that can best take advantage of the unique capabilities represented by anticipated high-voltage energy sources such as EEStor Inc.’s technolog.” In the past, it was all EEStor and nothing but the EEStor. Something has changed, or ZENN is merely trying to prepare itself for possible failure in Cedar Park. It is also pursuing patents for complementary technologies “applicable to both EEStor and non-EEStor energy storage systems.” Here the company is emphasizing alternatives, as well as other technologies beyond storage that it may be able to transition its business around. Personally, it sounds a stretch.
Other comments: “The Company is also actively engaged in opportunities to establish relationships with, or invest in, third-party companies that can provide complementary technologies that will enhance the Company’s overall solutions offering.” If EEStor is for real and does deliver, it won’t need complementary technologies, right?
Final comments from CEO Ian Clifford are also a bit wishy-washy.
“We continue to move forward with investments in engineering and business development initiatives that we believe will deliver the greatest long-term shareholder value,” stated Clifford, who is basically saying Don’t worry, if EEStor falls through we’ll have other pokers in the fire.
What he doesn’t say is where EEStor is at, and what shareholders can expect from that relationship. Given that the investment in EEStor is all there is to ZENN, you’d think it would be incumbent upon Clifford to say much more.
Tyler Hamilton is editor-in-chief of Corporate Knights magazine and a business columnist for the Toronto Star, Canada's largest daily newspaper. In addition to this Clean Break blog, Tyler writes a weekly column of the same name that discusses trends, happenings and innovators in the clean technology and green energy market. This blog is a personal project started in April 2005. It is not an official blog of the newspaper.
August 23rd, 2010 at 7:33 pm
Of course Zenn needs complementary technologies for EEStor’s ultra high energy/power density EESU. Establishing relationships up front with manufactures of true high speed charging stations will expedite sales. Offering high speed charging stations as a turn key solution puts Zenn in full control of the sales cycle and will ultimately enhance profits.
August 23rd, 2010 at 7:35 pm
Hmm- a little harsh on Ian, it seems. I know a lot of folks (bloggers;-) have given him and ZENN a hard time about their Eestor investment- but it was the best thing they could have done. Even back in, what, 2002, when Ian started Fell Good Cars, he saw the biggest problem with launching an EV company- the battery. And now, with the advent of virtually every major Auto-Maker in the world pursuing EVs to some extent, most new EV start-ups will fade from the scene- they just do not have the money and manufacturing capacity to compete. The notable exception might (and I stress the ‘might’ portion) be Tesla, because they were first to market and reaped some name recognition and government loans because of it.
But if Eestor can commercialize their product, ZENN will become a mult-billion dollar company in a very short time- yes, that is a big ‘IF,’ I’ll admit- but ZENN’s chances not only for success, but for wild, dot-com success, far outstrip every other EV startup. In the meantime, Ian is doing what he can- keeping ZENN’s name out there as much as he can, trying to cultivate business relationships that they can use if and when they get a working EESU. And at least they are conserving what cash they have, to wait as long as posible- you are right- ZENN’s success is inextricably tied to Eestor’s, and they are doing the smart thing right now by being as conservative as they can, verbally and fiscally.
It is almost ironic too- if ZENN does get, and is able sell soon, a working EESU from Eestor, and with the large automakers’ inertia, that may be the window for an EV startup or two to take off in, by offering an-EESU powered EV faster than the Big Companies- a cheaper, more powerful, longer-lived energy-storage device would level the field temporarilly. In fact, if I were one of the current, new would-be EV companies, I would take ZENN’s approach- realize you will not be able to compete with GM and Nissan, prepare a vehicle and power electronics to take advantage of an EESU, and conserve your cash. If one never comes, that’s okay- you weren’t going to make it anyhow- and if one does come along, you have a jump on the Big Boys and a chance to join their fraternity.
August 23rd, 2010 at 8:42 pm
Yeah, maybe I’m being harsh. No disrespect intended toward Ian Clifford. But I’ve been a business reporter for 12 years now and I know how to read press releases regarding earnings. When ZENN was hopeful it played up the EEStor relationship and investment. Now it seems to be burying it. I certainly hope I’m wrong, but the language used in these releases are very deliberate.
August 23rd, 2010 at 10:49 pm
I think you are staring at the tea leaves a little to hard as ZMC has a new CFO, Larry A. Goldberg, so it’s not surprising the tone would change.
I disagree that “…applicable to both EEStor and non-EEStor energy storage systems.” implies ZMC is looking for EEStor alternatives. There has been a spat of new ultra capacitor companies popping up such as Recapping Inc. and Stanford’s electronic battery. ZMC is just trying to lock up their head start in high voltage drive train and having patents in place before EEStor competitors come online is just being prudent.
I concur you’re being too hard on Ian when he said “We continue to move forward with investments in engineering and business development initiatives that we believe will deliver the greatest long-term shareholder value,…” This is such a inconsequential statement it becomes a Rorschach test and in Tyler’s case he’s annoyed as anyone with how late EEStor is in delivering on their final milestone.
August 23rd, 2010 at 11:04 pm
I know, Tom, those words are inconsequential. When companies have something to say they are direct and clear, not throwing inconsequential statements around when they have an obligation to shareholders to disclose material information. Obviously there’s not a heck of a lot of material stuff to say. I just think ZENN is positioning itself for a transition away from EEStor and that the language of this release hints at that. I certainly could be wrong, and hope I am… Clifford could be clearer and more forthcoming, and at the same time, I understand his reluctance to be, given that dates and milestones talked about in the past just haven’t come to fruition.
August 24th, 2010 at 3:01 am
[...] gloomy third quarter earnings reported on Monday Zenn even seems to distance itself from EEStor, as Tyler Hamilton points out, naming EEStor as one of the third party technology options it is pursuing and even notes the [...]
August 24th, 2010 at 4:24 am
When are the pumpers of EESCAM going to to be harsh on Ian Clifford for LYING EEStor’s reveal of EESUs has been imminent since 2006. When are the pumpers of EESCAM going to be harsh on Dick Weir Ceo of EEStor for conning investors of 10 million dollars based on LIES?
http://gm-volt.com/forum/showthread.php?p=40716#post40716
Dick Weir June 2009:
“We anticipate being in a production base of proto … of pre-production units in the fourth quarter this year. I’m already out there putting EESUs together and I’m still in June. So, it looks like I’m a little ahead of schedule. So, it looks like I can certainly meet that schedule”
August 24th, 2010 at 10:49 am
Obviously Zenn remains steadfastly convinced in the ability of EEStor to deliver per specification. How else can you explain Zenn’s willingness to consider investing in a 3rd party company that could supply “complimentary” technology. The key word here is “complimentary”.
August 24th, 2010 at 11:07 am
Cadre,
Ask Mr. “Dick has always been off by a month or two” tvillars if Dick is still ahead of schedule to deliever EESUs to Zenn in 2009?
August 24th, 2010 at 12:53 pm
From Rueters
The small Toronto-based company said in its results release late on Monday that it was pursuing a number of patents that could work with both EEStor and non-EEStor energy storage systems.
Some interpreted this as a sign that Zenn, whose future until now has been almost exclusively tied to the eventual delivery and success of the EEStor unit, was looking to distance itself from EEStor.
Scrimgeour said that was not so. Rather, a lot of the work Zenn has been doing while developing its electric drivetrain technology for zero-emission cars could be used with other applications and it would be a waste not to capitalize on this.
“If there is an opportunity to patent some of this expertise … into something that can work for us, even though it is perhaps outside the EEStor box, we are going to pursue that,” she told Reuters.
August 24th, 2010 at 1:32 pm
From Rueters Africa: http://tinyurl.com/255k3s7
“As far as I know they are concentrating their efforts in Texas,” Scrimgeour said.
“Monday’s financial results show that Zenn is going to “run out of money soon” and that they will need to tap the market or deep-pocketed investors for more, Jacob Securities analyst Khurram Malik said.”
.
————————————————————————————
“They are”, “Their efforts”
Why doesn’t CS state Ian Clifford and Zenn Motor Corp. have confidence EEStor WILL deliver functional technology by end of year? She doesn’t have to specify which year
August 24th, 2010 at 7:23 pm
Rueters UPDATE 2-Zenn stock sags on worries over EEStor project
* Analyst says broader patents a positive for shareholders (Recasts with stock drop; fresh analyst comment)
By Nicole Mordant
“In my opinion people are reading too much into the (Zenn) press release because there isn’t very much to read,” Paradigm Capital analyst Marvin Wolff said.
In a statement accompanying its quarterly results, Zenn said on Monday that it is “actively engaged” in trying to forge relationships or invest in, “third-party companies that can provide complementary technologies”
end Rueters
Complementary technology to EEStor is the key point here. Nowhere does Zenn proclaim in lieu of.
The Cadre has spoke
August 24th, 2010 at 7:32 pm
Zenn stockholders the ones without a bag over their head spoke and Zenn pps dropped 41 cents.
August 24th, 2010 at 7:33 pm
“Liars.” “Scammers.” It still amazes me, and it shouldn’t by now, how easily the anonymity of the Internet spews such slanderous statements. Certainly, there are an abundance of Liars and Scammers, especially ON the Internet- but not all people and/or businesses that fail to meet your expectations are Liars and Scammers. In fact most new businesses, without a hint of Lying or Scandalous behavior, just plain fail within 5 years of starting up. Is it possible that Dick Weir and Ian Clifford are scammers? Yes, it’s possible, on the same order it’s possible that I, er, you will be struck by a meteor by the time I finish typing this;-)
(for the record, I have no money invested in ZENN- too poor;-)
August 25th, 2010 at 12:29 pm
@Paul C, I don’t see you complaining about a blogger who hides behind a bag and slanders honorable men whom haven’t scammed anyone, Will Shores, Lionel Liebman and Bob Stevenson, CEO of Lockheed Martin by calling them “Those arrogant pricks”. http://tinyurl.com/26vz2bx
You can tell the Bagman slandering, name calling of skeptics of EEStor will not make him reputable blogger.
August 25th, 2010 at 1:09 pm
CadreNot (or should I say Aaron, or is that Steve?): LMAO, Learn how to read! (hint, go back and check your own link) B’s comments were tongue in cheek, unlike your visceral trolling.
August 25th, 2010 at 1:25 pm
@ O’Neil, also “Assholes at NASA” was tongue in cheek by the bagman, right?
August 25th, 2010 at 3:30 pm
Jacob Securities wrote:
The company also announced it was looking to establish relationships beyond EEStor to develop “complimentary” technologies. This disclosure was in-line with its existing strategy to enhance its EESU CENTRIC platform of services & products. It was initially misinterpreted by observers as a new initiative by ZNN to possibly distance itself from EEStor…….end Jacob Securities.
The EEStor EESU is not only centric to Zennergy but is the corner stone of Zenn’s business plan.
Le Cadre a Parlé
August 25th, 2010 at 10:06 pm
CadreNot- the eestorBlogger has…an odd bent of humor, some of which, like your examples above, I do not find all that funny, though I enjoy his site overall. Additionally, that is his site, and he can say what he wants on it- though even on his site I have suggested a more civil tone to BOTH sides upon occassion. I understand disagreement, caution, even skepticism upon someone’s business plan and/or product development, especially with such a high-risk, speculative investment/product such as ZENN and Eestor’s EESU- but these are still just normal, everyday people trying to carve out their own dreams- it’s bad enough that all such ventures are now under the scrutiny of anyone with an Internet connection- but I still think the line should be drawn when someone’s character is called into question without substantive proof- and even then such ‘courts of public opinion’ tread in very murky waters.
August 26th, 2010 at 7:04 am
@Cadre, pat yourself on the back Eenigma. Bagman (eestorblogger/b) and his”team” are proud of your posts making them feel good. Hopefully the bagman rewarded you with a lollipop.
August 26th, 2010 at 8:56 pm
This was easily zenn’s most unilluminating press release. What people want to know is how are they spending their time waiting for Eestor? This press release says they might be doing something.
It doesn’t make sense to hype Eestor for 3 years and ignore their request for stealth but then, when eestor is late pretend stealth is suddenly important.
People who build great companies sketch a vision and everything they do and report is tied to that vision. These guys talked about zennergy a long time ago and have shown no progress at all towards that. Now suddenly we’re supposed to focus on some 3rd new technology that they can’t describe?
The only logical conclusion to draw now is they don’t really care what they say.
Zenn was talking about evs way before major automakers were. That’s changed. Zennergy made sense if you believed oem might buy rather than build power electronics. But now automakers are already executing. The only thing then that is left to do is provide a better battery.
This company wants to be too many startups all at once.