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High speed and high torque electric transaxle enabling unprecedented use in agricultural applications

Periodic Reporting for period 1 - TX3 (High speed and high torque electric transaxle enabling unprecedented use in agricultural applications)

Reporting period: 2017-05-01 to 2017-08-31

Farm equipment in advanced markets such as the Americas and Europe are characterized by high technology penetration, where at least 60.0% of the farming equipment uses some sort of precision technology. Yet, 98% of the farm equipment is powered by Diesel or Hybrid engines, with the other 2% being electric vehicles with a single speed differential.
The need to reduce the GHG emissions, as per the EU 2011 White Paper, and the requirement for all vehicles operating indoors to be electric, together with the health and potential premature deaths caused by the combination of ammonia and the particles from the agricultural internal combustion engines, are set to boost demand for electric equipment in multiple sectors.
TX3 goes towards the fully connected and electric vehicle, thus full communication between all components and the cloud management for a more efficient operation. TX3 is a market brand new Transaxle system aimed at medium power (10-30 Kw) electric vehicles where a combination of ‘high torque + low speed’ and ‘low torque + commuting speed’ is required. Up to date, any attempt to perform with an electric vehicle of such characteristics has been futile due to the lack of dual speed transaxle systems (all of them are single speed).
Benevelli aims to overtake this issue by providing the first-on-the-market dual speed transaxle system for medium power electric agricultural vehicles. The potential customer segments for TX3 are primarily Agricultural users, followed by Handling, Patrolling & Municipality and Mining.
Trends toward commercial farming are increasing to reduce the high cost of farming, and propelling the demand for precision farm equipment. Our strong presence within Europe and North America through our current customers and distributors, has led us to the selection of the target markets for the first 5 years of commercialisation of TX3.
For the last 4 months, we have prepared an Execution Plan for the final development, analysing costs, technical and commercial risks and planning resources. At a commercial level, we have identified, and studied in detail, our target markets in order to prepare our marketing strategy. We have performed a Freedom-to-Operate analysis, which has shown that potentially there is no possible conflict with intellectual property rights of third parties in the regions where we aim to sell our new product. And lastly, we have prepared financial projections in order to evaluate the return on investment of the product development.
Taking as a starting point the TRL6 prototype we presented at Phase 1, we have focused on the deep investigation for the market and customers. By using our existing broad distributors network and customers, we have presented our project, receiving massive interest (some of it translated into contracts and agreements) not only from the agricultural sector, but from other market sectors where similar vehicle characteristics are required, like city maintenance and patrolling, handling, mining, or construction.
The global farm equipment market value is estimated to grow from €45.2Bn (5,051,700 units) in 2015 to €63.5Bn (7,361,300 units) by 2022, with Europe and North America together representing the 50%. Among them, tractors are the barometer of these sales, accounting for an average the 40% of the total farm vehicles and equipment, which means 2.1M tractors sold in 2015 and 2.89M expected to be sold in 2022 at a compound annual growth rate (CAGR) of 4.8%.
Electric vehicles for construction, agriculture and mining will be an €68 billion market in 2027. Komatsu, John Deere, Caterpillar, and others manufacture the big vehicles - mainly hybrid - while other manufacturers offer smaller, pure-electric versions.
Precision agriculture is expected to become standard practice to manage non-conformances in agriculture and can improve farm productivity up to 60% compared to traditional farming practices.
Based on our expected financial projections, the project will generate a cumulative turnover of €19.6M and profit of €5.31M with a ROI of 3.62 (ROI of 10.79 if EU financed) by the fifth year of commercialization, when we will achieve the 0.36% of the target market, and creating 18 jobs linked to production, assembly, distributors, maintenance and marketing & sales team.