Workhorse Group Inc. (WKHS): Business Model Canvas [Dec-2025 Updated]

You're looking at the operational blueprint of Workhorse Group Inc. (WKHS) right now, and honestly, the whole picture is dominated by the pending merger with Motiv Electric Trucks-a clear pivot toward survival and scale. This transition redefines everything, from their recent record Q2 2025 Net Sales of $5.7 million to the underlying negative gross margin caused by their high Cost of Sales. As an analyst, I see a company betting its future on integrating new platforms and achieving $20 million in cost synergies by the end of 2026, all while leaning on a cash position of $38.2 million as of September 30, 2025. To see precisely how they plan to turn these manufacturing and partnership assets into profitable revenue, check out the full, nine-block canvas below.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Key Partnerships

You're looking at the structure Workhorse Group Inc. is building to scale its commercial EV presence, and the Key Partnerships block is where the rubber meets the road, so to speak. Honestly, the success of any OEM in this space hinges on who you can trust to build, sell, and service the product when you can't do it all yourself. Here's the breakdown of the critical alliances as of late 2025.

The strategic moves Workhorse Group Inc. is making are clearly focused on achieving scale and market penetration, especially as they navigate the transition following their latest reported Q2 2025 revenue of $5.67 million and an EPS of -$1.67. The partnerships are designed to shore up manufacturing, distribution, and after-sales support.

Partner Entity	Primary Role in Business Model	Key Quantifiable Metric/Status (as of late 2025)
Motiv Electric Trucks	Strategic Merger to create a leading North American medium-duty EV OEM	Combined entity valued at approximately $105 million; projected cost synergies of at least $20 million by end of 2026.
National Certified Dealer Network (e.g., Ziegler Truck Group)	Sales and service expansion for Class 4-6 electric trucks	Ziegler Truck Group locations now include a third Midwest site in DeForest, Wisconsin, and Range Truck Group in Washington.
Colonial Equipment Company	Streamlined government fleet sales via GSA AutoChoice provider status	Facilitates access through GSA Contract GS-30F-RA005 (SIN 493E); a prior contract obligation noted was $366,224.
Utilimaster	Upfitter providing industry-standard body for the W56 step van platform	Aeromaster body integration validated for the W56, which offers up to 1,200 cubic feet of cargo space.
Zeem Solutions	Certified service partner for maintenance support, focused on California operations	Flagship hub in Los Angeles, California, with plans to expand nationwide service hubs.

The merger with Motiv Electric Trucks is the biggest news here, definitely changing the landscape for Workhorse Group Inc. This all-stock transaction, expected to close in Q4 2025, brings together Workhorse Group Inc.'s manufacturing base with Motiv's deployed fleet experience. Motiv has already put over 270 electric trucks on the road, logging more than 4 million miles driven. The combined manufacturing facility in Union City, Indiana, is slated to have a capacity of up to 5,000 trucks per year. Upon closing, Motiv's controlling investor is set to own approximately 62.5% of the new entity, while existing Workhorse shareholders retain about 26.5%.

Expanding the sales footprint relies heavily on the National Certified Dealer Network. You see Workhorse Group Inc. actively adding partners to ensure serviceability across key markets. For instance, in May 2025, the network grew with the addition of Range Truck Group in Fife, Washington, and a third Ziegler Truck Group location in DeForest, Wisconsin. Ziegler Truck Group's status as a California Air Resource Board (CARB) HVIP dealer is important, as it helps customers access incentives.

Securing government business is streamlined through Colonial Equipment Company. This partnership leverages their role as the GSA AutoChoice provider. Workhorse Group Inc. vehicles, specifically the W56 platform, are available to federal agencies under GSA Contract GS-30F-RA005, listed under Special Item Number (SIN) 493E. This is a direct channel to public sector procurement, which is a defintely less volatile revenue source than direct commercial sales.

The product offering itself is enhanced by the Utilimaster relationship. Workhorse Group Inc. completed the integration and validation of the aluminum Aeromaster walk-in body onto the W56 chassis in November 2025. This gives fleets a familiar body style on the new electric platform. The W56 chassis itself is engineered for last-mile delivery, offering:

• Range up to 150 miles or more on a single charge.
• Cargo space up to 1,200 cubic feet.
• Durable aluminum construction from Utilimaster.

Finally, keeping those trucks running is the job of service partners like Zeem Solutions. This partnership focuses on providing Workhorse-certified service, especially as the customer footprint grows in California. Zeem Solutions currently operates from its flagship hub in Los Angeles, California, and is positioned to minimize downtime for fleet operators there. This focus on after-sales support is crucial for fleet adoption.

Finance: draft 13-week cash view by Friday.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Key Activities

You're looking at the core engine driving Workhorse Group Inc.'s strategy as of late 2025, right after the shareholder vote on the Motiv merger. This is where the rubber meets the road, literally.

Manufacturing and assembly of W56 and W4 CC electric trucks in Union City, Indiana

The primary activity centers on the production of the W56 and W4 CC electric trucks at the Union City, Indiana facility, which also served as collateral for a key financing move. The operational focus is clearly on getting reliable units out the door and proving their durability in the field.

• Delivered 15 trucks in the third quarter ending September 30, 2025, a mix of Class 4 and 5 versions.
• The W56 platform demonstrated 97% uptime across operating fleets in daily last-mile operations as of Q3 2025.
• Over 42 vehicles were operating in customer and partner fleets as of the end of Q3 2025.
• The facility itself was part of a $20 million sale-leaseback transaction to bolster liquidity.

Executing the Motiv merger and achieving the targeted cost synergies

The strategic combination with Motiv Electric Trucks is a massive key activity, aimed at consolidating resources and achieving scale. This is a financial engineering and integration effort happening concurrently with truck production.

The merger received shareholder approval on November 25, 2025, with closing expected in the following weeks.

Synergy/Funding Metric	Value/Target	Timeline/Context
Projected Cost Synergies	At least $20 million	Targeted by the end of 2026
Interim Funding from Motiv Affiliate	$25 million total	Comprised of a $20M sale-leaseback and $5M convertible note
Post-Close Debt Financing Access	Up to $20 million	Includes a $10M revolving credit facility and $10M ABL facility
Q3 2025 SG&A Impact from Merger	$3.6 million higher	Consulting/legal fees tied to the Motiv merger

Product development: Launching new variants like the 140 kWh W56 stripped chassis

Workhorse Group Inc. is actively developing its product line to hit specific market niches, especially cost-sensitive ones. They are designing and building their Class 5-6 step vans completely in-house, from frame to final paint.

• Previewed the 140 kWh W56 stripped chassis at Work Truck Week 2025 in March.
• The 140 kWh variant is designed for an estimated range of 100 miles.
• Orders for the 140 kWh chassis were being accepted in early 2025, with first deliveries slated for 2026.
• The W56 platform completed durability testing simulating over 250,000 highway miles.
• The Utilimaster Aeromaster body became available for the W56 platform in Q3 2025.

Fleet sales and consultative support for first-time EV fleet operators

This activity involves converting interest generated at industry events into actual revenue and supporting new customers through the EV transition. You're seeing a slight dip in Q3 revenue compared to Q2, which is typical as they ramp production.

Here's the quick math on recent sales performance:

Period End Date	Net Sales (Revenue)	Trucks Delivered/Shipped
September 30, 2025 (Q3)	$2.385 million	15 trucks
June 30, 2025 (Q2)	$5.7 million	32 W56 trucks shipped (a record)
March 31, 2025 (Q1)	$0.6 million	No specific delivery number, but 27 W56 and six W4 CC/W750 in purchase orders

The company is actively engaging with potential customers, including securing an initial order from Gateway Fleets in Q1 2025.

Managing and expanding the certified dealer and service network

Building out the physical touchpoints for sales and service is crucial for scaling commercial vehicle adoption. You need certified technicians ready when a fleet operator has an issue.

• Secured a purchase order from a Washington municipality via certified dealer The Truck Shop.
• Expanded the network in May 2025 by adding Range Truck Group in Fife, Washington, through the Ziegler Truck Group partnership.
• The network includes a GSA AutoChoice provider, Colonial Equipment Company, to facilitate federal government sales.
• As of late 2023, the network count was eight partners nationwide.

Finance: draft 13-week cash view by Friday.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Key Resources

You're looking at the tangible and intellectual assets Workhorse Group Inc. relies on to execute its business plan as of late 2025. These are the foundational elements that support their production and market strategy.

Physical and Financial Assets

The physical footprint and the current liquidity position are critical resources. Workhorse Group Inc. operates its primary manufacturing from the Union City, IN manufacturing facility, also known as the Workhorse Ranch. During the third quarter of 2025, Workhorse Group Inc. recognized a gain on sale of assets of $13.8 million primarily related to the Sale Leaseback of this Union City, IN Facility.

Financially, the balance sheet as of September 30, 2025, showed cash and restricted cash totaling $38.2 million. This compares to $4.6 million in the same period last year, an increase largely due to funding totaling approximately $25 million from Motiv's controlling investor, which included a $20 million sale leaseback transaction and a $5 million secured convertible note financing, both completed upon execution of the merger agreement.

Inventory levels fluctuate based on production and delivery schedules. As of the first quarter ended March 31, 2025, the inventory of vehicles and components was valued at $41.3 million, net of reserves. By the end of the third quarter, September 30, 2025, net inventory stood at $30.0 million.

Here is a look at the key financial positions around the reporting dates:

Financial Metric	Date	Amount
Cash and Restricted Cash	September 30, 2025	$38.2 million
Inventory (Net of Reserves)	March 31, 2025 (Q1 2025)	$41.3 million
Net Inventory	September 30, 2025 (Q3 2025)	$30.0 million
Gain on Sale Leaseback (Union City Facility)	Three Months Ended September 30, 2025	$13.8 million

Core EV Platforms and Production Capabilities

Workhorse Group Inc.'s product line centers on two core EV platforms designed for the commercial sector. The company completed the sale of 15 trucks in the third quarter of 2025, which was a combination of both Class 4 and 5 versions.

The primary platforms are:

• The W56 Class 5/6 step van.
• The W4 CC Class 4 cab chassis.

Specific order and performance metrics related to these platforms include:

• In Q1 2025, Workhorse Group Inc. secured purchase orders for 27 W56 step vans.
• In Q1 2025, purchase orders were also received for six W4 CC/W750 trucks.
• The W56 platform achieved a reported reliability uptime of 96% based on field-proven performance.
• A 2400-mile W56 road test was completed in the first quarter of 2025.

The company also announced the availability of the Utilimaster Aeromaster body for its W56 Class 5/6 step van during the third quarter of 2025.

Proprietary Expertise

Intellectual capital is vested in the proprietary EV design and the in-house vehicle integration expertise. This expertise supports the production at the Union City, IN plant, which employs an experienced chassis builder team. The company's focus on product roadmap execution and reliability testing, such as the W56 road test, demonstrates the application of this internal knowledge base.

The reduction in Research and Development expenses for the three months ended September 30, 2025, was $1.2 million year-over-year, driven partly by lower prototype part expense of $500,000, suggesting a shift from heavy development to production scaling for existing platforms.

Finance: review Q4 2025 capital expenditure forecast by end of next week.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Value Propositions

You're looking at the core reasons a fleet operator would choose a Workhorse Group Inc. electric vehicle right now. It boils down to proven reliability and tailored options for the demanding last-mile environment.

Workhorse Group Inc. offers zero-emission medium-duty trucks specifically engineered for last-mile and commercial applications. This focus means the product development is centered on the realities of daily delivery routes, not general-purpose trucking.

The platform's reliability is a major selling point. The W56 platform has demonstrated high vehicle uptime in real-world use. For the three months ended September 30, 2025, Workhorse Group Inc. reported that these vehicles delivered 97% uptime in daily last-mile operations.

The overall fleet experience backs this up; Workhorse vehicles have logged a total of 10 million real-world miles as of early 2025.

Workhorse Group Inc. provides a versatile W56 platform that addresses different capacity needs. You have options to match the job precisely.

The W56 comes in multiple wheelbases, specifically the 178-inch and the 208-inch versions. The extended 208-inch wheelbase model is engineered for increased cargo capacity, featuring 1,200 cubic feet of space and supporting a benchmark payload capacity of up to approximately 10,000 pounds. This model has also completed durability testing simulating over 250,000 highway miles.

To give you a clearer picture of the W56's capabilities based on recent testing and specifications, here is a comparison of the two main platform variants:

Specification	W56 (Standard/Base)	W56 (208-inch Extended Wheelbase)
Wheelbase	178-inch	208-inch
Cargo Volume	Not explicitly stated for base model	1,200 cubic feet
Max Payload	Not explicitly stated for base model	Up to approximately 10,000 pounds
Durability Test Simulation	Implied by platform testing	Over 250,000 highway miles

Workhorse Group Inc. also offers a cost-efficient entry point for fleets with shorter operational requirements. This is the 140 kWh stripped chassis variant, designed specifically for short-range routes.

This smaller battery option provides an estimated range of 100 miles, which is plenty of coverage for many single-shift local delivery routes, and it offers attractive cost savings compared to the 210 kWh version.

The value proposition extends beyond just the vehicle specifications to total cost of ownership advantages demonstrated in long-haul testing. Consider these efficiency metrics from a recent 2,400-mile cross-country drive:

• Achieved 27 miles per gallon of gasoline-equivalent (MPGe) at highway speeds.
• Averaged 53% lower fuel costs compared to internal combustion engine (ICE) equivalents.
• Projected 40% lower scheduled maintenance costs over five years.

The versatility of the W56 platform is further enhanced by body options, including the recent completion of integration, testing, and validation for the industry-standard aluminum Aeromaster walk-in body from Utilimaster.

To summarize the key differentiators Workhorse Group Inc. is putting forward for the W56 platform:

• Zero-emission for commercial last-mile use.
• 97% demonstrated vehicle uptime in Q3 2025.
• Wheelbase options: 178-inch and 208-inch.
• Cost-effective 140 kWh stripped chassis option.
• Durability validated by 250,000 highway miles simulation.

Finance: draft 13-week cash view by Friday.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Customer Relationships

You're looking at how Workhorse Group Inc. builds and maintains its connections with fleet operators making the big switch to electric. It's not just about selling a truck; it's about guiding them through a complex transition, so the relationship needs to be deep and ongoing.

Consultative sales model to guide fleets through the complex EV transition.

Workhorse Group Inc. employs a consultative approach, which is necessary when selling high-value commercial assets like electric step vans. This involves demonstrating real-world capability to de-risk the purchase decision for fleet managers. For instance, the W56's performance was proven by operating through the 2024 holiday peak delivery season, covering nearly a thousand miles in sustained sub-freezing temperatures, which serves as a key data point for prospective buyers. The company secures initial orders that act as pilots, such as the initial order from Gateway Fleets, which is set to deploy W56s across its network serving the independent service provider (ISP) community during Q3 2025. This consultative step is crucial for securing larger, long-term commitments.

Dedicated aftersales support via the certified dealer and service partner network.

The long-term viability of the customer relationship hinges on service availability. Workhorse Group Inc. relies on a growing network of certified dealers and service partners to handle maintenance and repairs. As of May 2025, the network expanded with Ziegler Truck Group adding Range Truck Group in Fife, Washington, and a third location in DeForest, Wisconsin. This builds on the existing network, which included 11 partners nationwide as of April 2024. Furthermore, to bolster service in key markets, Workhorse Group Inc. partnered with Zeem Solutions in February 2024 to provide certified service options, initially operating out of a hub in Los Angeles, California, with plans to build additional hubs. The performance of the existing fleet validates this support structure; as of Q2 2025, delivered vehicles logged more than 212,000 miles and achieved 97% uptime.

Direct engagement with large, blue-chip fleet customers for long-term orders.

Direct engagement targets major fleet operators who can place significant, recurring orders. Workhorse Group Inc. actively pursues these relationships, evidenced by securing purchase orders for a total of 27 W56 step vans and six W4 CC/W750 trucks thus far in 2025 (as of the Q1 2025 report). The company also completed the sale of 15 trucks in Q3 2025, a mix of Class 4 and 5 versions. These direct sales efforts are supported by product enhancements like the W56 208-inch extended wheelbase, which offers nearly 1,200 cubic feet of cargo capacity.

Leveraging customer success stories (e.g., NorthStar Courier) to drive new sales.

Concrete success stories are used to convert prospects. NorthStar Courier, a FedEx Ground Contract Service Provider, serves as a prime example. After successfully operating its initial W56 EV step van through the 2024 holiday peak, covering nearly a thousand miles in sub-freezing temperatures, NorthStar Courier expanded its zero-emission delivery capabilities by adding a new W56 208-inch extended wheelbase truck in February 2025. This expansion was facilitated through the certified dealer, Ziegler Truck Group. Another success involved a national provider of uniforms and workplace supplies, which shifted its entire order to 13 of the W56 208-inch wheelbase trucks in March 2025, based on the performance of the extended wheelbase model.

Here's a quick look at the customer engagement metrics we see through the first three quarters of 2025:

Metric	Value/Amount	Date/Period
Total Vehicles in Customer/Partner Fleets	Over 60	As of Q2 2025
Total Miles Logged by Delivered Vehicles	More than 212,000 miles	As of Q2 2025
Fleet Uptime Achieved	97%	As of Q2 2025
W56/W4 CC Purchase Orders Secured (YTD)	33 total units (27 W56 + 6 W4 CC/W750)	As of Q1 2025
Truck Sales Completed	15 trucks	Q3 2025
New Dealer Locations Added (Ziegler Expansion)	2	May 2025

The focus on certified service partners like Ziegler Truck Group and Zeem Solutions is defintely a core part of keeping these relationships strong post-sale. Finance: draft 13-week cash view by Friday.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Channels

You're mapping out Workhorse Group Inc.'s go-to-market strategy, and the Channels block shows a multi-pronged approach to reach commercial and public sector customers. It's not just one path to sale; it's a mix of established dealer relationships, direct large-scale negotiation, and leveraging government procurement vehicles.

The National Certified Dealer Network is foundational for broad service and parts availability. For instance, in the first quarter of 2025, Workhorse Group Inc. reinforced this by adding two new dealer locations under the Ziegler Truck Group umbrella: Range Truck Group in Fife, Washington, and a third Ziegler location in DeForest, Wisconsin. This dealer expansion is key for regional support, as demonstrated when a municipal fleet in Washington secured two W4 CC trucks through a certified dealer. The company was still actively discussing new orders through this network as of the third quarter of 2025.

The Direct Sales Team targets bigger wins, focusing on securing large fleet purchase orders directly. The momentum here is visible in the quarterly order flow. Through the first quarter of 2025, Workhorse Group Inc. booked orders for 27 W56 step vans and six W4 CC/W750 trucks year-to-date. This built into a record second quarter of 2025, where 36 purchase orders for the W56 were secured, leading to the shipment of a record 32 trucks in that quarter. By the third quarter of 2025, the company completed the sale of 15 trucks. Overall fleet penetration is growing; as of the second quarter of 2025, more than 60 W56 vehicles were operating in customer and partner fleets. By the end of Q3 2025, this number was more than 42 vehicles achieving 97% uptime in daily last-mile operations.

Access to the public sector is streamlined through government procurement contracts, which bypass lengthy individual bidding processes. Workhorse Group Inc. secured a significant General Services Administration (GSA) Government Fleet Contract, GS-30F-RA005 (SIN 493E), allowing federal agencies to procure W56 platform vehicles. Furthermore, the Sourcewell cooperative purchasing agreement, Contract #: 032824-WKH, for Class 4-8 chassis and cabs, runs until July 9, 2028. State-level access is also active, with Kingsburg Truck Center securing a California Department of General Services contract for W4 CC and W56 models.

Strategic partners are essential for offering complete electrification solutions, which helps lower the barrier to entry for fleet operators. The partnership with Revolv is a prime example. In the first half of 2025, Workhorse Group Inc. began delivering 13 of the newly available 208-inch extended wheelbase W56 step vans to a national uniform provider through Revolv. This specific vehicle configuration offers compelling specs for last-mile use:

Specification	Workhorse W56 (208-inch WB via Revolv)
Cargo Space	1,200 cubic feet
Maximum Range	Up to 150 miles
Payload Capacity	Around 10,000 pounds

Also, Workhorse Group Inc. announced a new foundation for a long-term relationship with Gateway Fleets for W56 deployment across its Independent Service Provider (ISP) network starting in Q3 2025.

Here's a quick look at how these channels supported order flow and deployment in the first half of 2025:

• Secured 27 W56 purchase orders in Q1 2025.
• Shipped 32 W56 trucks in Q2 2025.
• Delivered 13 W56 units to a national fleet via Revolv in Q2 2025.
• Secured an order for 2 W4 CC trucks via a dealer using Sourcewell access.
• Total W56 units shipped in the first half of 2025 (35 trucks) exceeded all shipments for all of 2024 (29 trucks).

If the Motiv Electric Trucks merger closes in Q4 2025, the channel strategy will integrate Motiv's top fleet relationships with Workhorse Group Inc.'s national dealer network, aiming to create a leading North American medium-duty OEM. Finance: finalize the integration plan for the combined entity's channel management structure by December 15, 2025.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Customer Segments

You're looking at the core groups Workhorse Group Inc. is targeting with its zero-emission commercial vehicles, primarily the W56 platform. Honestly, the focus is clearly on high-utilization, short-haul operations where the total cost of ownership (TCO) advantage of electric vehicles really starts to show up.

Last-mile delivery Independent Service Providers (ISPs) and parcel carriers represent a key segment. Workhorse Group Inc. secured an initial order from Gateway Fleets, which plans to deploy the W56 across its network serving the Independent Service Provider (ISP) community during Q3 2025. The real-world performance data is what sells here; as of the third quarter of 2025, Workhorse Group Inc. reported that more than 42 vehicles were operating in customer and partner fleets, achieving a 97% uptime in daily last-mile operations. Furthermore, deliveries began in April 2025 for the 208-inch extended wheelbase W56 to a national provider of uniforms and workplace supplies through the partner Revolv.

Federal, State, and Municipal Government Fleets are another critical area, made more accessible through recent contract awards. Workhorse Group Inc. was added to the GSA Schedule via the General Services Administration Government Fleet Contract (GS-30F-RA005, SIN 493E), which streamlines procurement for federal agencies looking at the W56 platform. This access is augmented by several cooperative purchasing agreements:

• Sourcewell: Supports municipalities, school districts, and nonprofits.
• Florida Sheriff's Association Purchasing Program: Serves police departments and municipal fleets.
• OMNIA Partners: Procurement via the lending partner Doering Fleet Management.
• PASSPort: The City of New York's procurement platform, using dealer Burr Truck.

State-level interest is also materializing; in Q1 2025, the California Department of General Services awarded a contract to supply W4 CC and W56 electric commercial trucks to state agencies. A municipal fleet in Washington also secured a purchase order for two W4 CC trucks in the first quarter of 2025.

For Commercial and Industrial Fleets requiring medium-duty work trucks, the focus is on proven capability. The W56 step van, available in 178- and 208-inch wheelbases, is designed to fit Class 4-6 medium-duty operations. The vehicle specifications, such as the 208-inch variant offering up to 1,200 cubic feet of cargo space and approximately 10,000 pounds of payload capacity, are engineered to cover most single-shift routes. Fleet operators prioritizing zero-tailpipe emissions are the target, as demonstrated by the overall operational metrics.

Here's a quick look at the order flow across these segments through the first three quarters of 2025:

Period	Vehicle Type	Purchase Orders/Sales
Q1 2025 (Year-to-Date)	W56 Step Vans	27 received (178- and 208-inch wheelbases)
Q1 2025 (Year-to-Date)	W4 CC/W750 Trucks	6 received
Q2 2025	Total Trucks Shipped	32 (record shipment)
Q3 2025	Total Trucks Sold	15 (Class 4 and 5 versions)

The drive for zero-tailpipe emissions is a unifying factor across all these segments. The W56 platform is engineered to meet this demand, with one customer noting its 96% uptime during a recent peak season across diverse routes and weather, which they stated was the best uptime record in the commercial EV segment at that time.

What this estimate hides is the exact breakdown of the 32 units shipped in Q2 2025 or the specific mix of the 15 trucks sold in Q3 2025 between the W4 CC and W56 models, but the trend shows active deployment. Finance: draft 13-week cash view by Friday.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Cost Structure

You're looking at the cost side of Workhorse Group Inc. (WKHS), and honestly, the numbers from mid-2025 show a significant challenge in turning production into profit. The structure is heavily weighted toward the cost of building the vehicles, which is eating up revenue before operating costs even come into play.

The most immediate pressure point is the High Cost of Sales. For the second quarter of 2025, the Cost of Sales hit $13.1 million. This high cost, relative to the revenue generated, resulted in a negative gross margin, which is a critical area for Workhorse Group Inc. to address to achieve sustainability. For context, the GAAP gross loss for Q2 2025 was reported at $7.4 million.

This cost structure includes significant expenses related to Production and inventory costs. Specifically, the Q2 2025 Cost of Sales increase was partly due to an increase in inventory excess and obsolescence reserves of $1.8 million. This reserve indicates a cost associated with holding inventory that might be slow-moving or potentially unusable, which directly impacts the bottom line.

On the operational side, Workhorse Group Inc. has been actively cutting overhead, which you can see in the operating expenses for Q2 2025:

• Selling, General & Administrative (SG&A) expenses were reduced to $5.8 million.
• Research and Development (R&D) expenses were lowered to $1.2 million.

These reductions show a clear focus on streamlining operations, with SG&A dropping by $6.3 million year-over-year in Q2 2025. Still, these are costs incurred before even considering financing.

Financing costs are also a factor, particularly the expense tied to debt instruments. For the first quarter of 2025, the reported Interest expense, net, was $5.3 million, which the company noted was primarily driven by recognition of interest expense related to higher outstanding convertible note balances.

The strategic merger with Motiv is explicitly aimed at restructuring this cost base for the future. The combined entity has a stated goal to achieve cost synergies of $20 million by the end of 2026. These projected savings are targeted across R&D consolidation, general and administrative efficiencies, and facility optimization.

Here is a quick look at some of those key cost metrics from the first half of 2025:

Cost Metric	Q1 2025 Amount	Q2 2025 Amount	Notes
Cost of Sales	Not specified	$13.1 million	Q2 2025 figure.
Selling, General & Administrative (SG&A)	$6.8 million	$5.8 million	Q1 2025 vs Q2 2025.
Research & Development (R&D)	Not specified	$1.2 million	Q2 2025 figure.
Interest Expense, Net	$5.3 million	$0.6 million	Q1 2025 vs Q2 2025.
Inventory Reserve Impact (Q2)	Not specified	$1.8 million	Increase in excess/obsolescence reserve in Q2 2025.

The company is definitely trying to manage these outflows. Finance: draft the 13-week cash view by Friday, focusing on the burn rate implied by the Q2 Cost of Sales versus revenue.

Workhorse Group Inc. (WKHS) - Canvas Business Model: Revenue Streams

You're looking at how Workhorse Group Inc. (WKHS) is bringing in cash right now, which is primarily through selling its electric commercial vehicles, the W56 and the W4 CC.

The sales side saw a big jump in the second quarter of 2025, hitting $5.7 million in Net Sales. That was a record quarter for them, driven by shipping a record 32 W56 trucks in Q2 2025. Still, the revenue stream from direct vehicle sales can be lumpy; for instance, Q3 2025 Net Sales were reported at $2.4 million.

Here's a quick look at the top-line revenue picture as of late 2025:

Metric	Amount
Net Sales (Q2 2025)	$5.7 million
Net Sales (Q3 2025)	$2.4 million
Revenue (Trailing Twelve Months - TTM)	$10.62 million

You also need to account for how they recognize revenue over time. For the three months ended September 30, 2025, Workhorse Group Inc. recognized an increase of $2.2 million related to the recognition of seven vehicles from deferred revenue, which helped offset lower truck deliveries that quarter.

The other key component of the revenue model, definitely a growth area you should watch, is the aftermarket support structure. This covers revenue generated through the certified network:

• Aftermarket parts sales.
• Service revenue.
• Maintenance contracts and support.

The company is focused on leveraging its installed base of W56 platforms, which showed a remarkable 97% uptime across 212,000 miles in diverse conditions, to build out this recurring service revenue stream.