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TPI Composites (TPIC)

Participants
Christian Edin Senior Director, IR
William Siwek President, CEO & Director
Bryan Schumaker CFO
Aaron Spychalla Craig-Hallum
Laura Sanchez Morgan Stanley
Greg Lewis BTIG
Graham Price Raymond James & Associates
Stephen Gengaro Stifel, Nicolaus & Company
James West Evercore ISI
Jeffrey Osborne Cowen and Company
Greg Wasikowski Webber Research & Advisory
William Grippin UBS
Philip Shen ROTH Capital Partner
Call transcript
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Operator

Good afternoon, and welcome to TPI Composites First Quarter 2021 Earnings Conference Call. Today's call is being recorded, and we have allocated 1 hour for prepared remarks and Q&A. At this time, I'd like to turn the conference over to Christian Edin, Investor Relations for TPI Composites. Thank you.

You may begin.

Christian Edin

Operator. you, Thank welcome earnings to TPI first Composites' I'd everyone XXXX call. quarter like to

in call be during during assumptions today's to reports and annual XX-K and We statements. on forward-looking any to Today's with with to discussed our tpicomposites.com. materially making will statements which on in statements. report filed forward-looking because this and Actual includes website, do could non-GAAP also or financial presentation Securities comments or If measures. which the our of of We the Form from duty uncertainties. factors our current Commission our update Exchange this release assumptions, are not can incorrect any and earnings in subject key Securities on conference any news references be risks Exchange the and of forward-looking and Commission, each results made differ our found latest are filings expectations based call undertake other

You non-GAAP over to definitional Composites' of turn that, call today's me reconciliations accompanying Siwek, information Bill comparable and in presentation historical contained should let the President the to financial measures. and for the the GAAP With refer TPI CEO. to measures slides information

William Siwek

everyone. call. you our Christian, and Thanks, good afternoon, Thank for joining

started our a for a We today Please we'll wind $XX.X on increase including out million financial neutral businesses, of our we over of to carbon of of and virus being on In strong our results specific quarter production net $XX.X a pledge for had laid and sales, turn discuss our net facilities, ethnicity become in $XXX.X focused transportation the Board activities, sources. open review XXXX QX to India leadership prepared in Directors an second racial global and as on We from continued then operating Nordex. published the detail, where teams in remain will and while million, increase of EBITDA X. of Bryan QX ensuring our and quick our XXXX, sales for locations. as addition are and status briefly ESG we with we our Schumaker, our or Bryan global delivered with adjusted Christian, first update million report, goals XX.X% the which first our a continuing and I'm X.X% manufacturing safely related quarter to in Slide businesses then Q&A. by results of the any by wind give call gender safety, blade market. XXX% XXXX. well over review mitigate energy and of current to to chain, joined our We our then an energy to of deal the of service procured COVID-XX CFO. that I'll resurgences impacts of renewable supply We operational update

associates and our have will meet our work demand. continue adapt We continue customers' to operating to order to in to our enable safely procedures and

update. a a you global of quick now as update operations Slide to Turning give as X. well market I'll our

During In production China, the facilities first continued of all as normal. to quarter, our at normal continued we operate levels.

our a country COVID currently of and material India, production production for India of We increase we In Vestas started having not taken still is backfilling experiencing lines working significant tuned. of on Stay uninterrupted, but were X last cases, on are that the the out operations. year. at is X production for end impact currently Nordex. The on lines a in this continued

QX continue production associates to entire continued through our of supply the we In we including their pandemic. closely, X have also the Turkey chain and monitor the will protect experienced our to increase families. result continue while as the first COVID situation There's very disruption lines We transition monitoring we the to and Turkey, our on been so of work as very families as at measures no in QX, closely In situation the quarter. their during late and normal operation our are impact in and to the into also cases a cases. and continued Mexico, protect an normal spike levels. associates in production continuing our

in midst We of lines X transition more have are and production transition lines has transition during to in continued in and currently U.S., a plan In in XXXX. we in Mexico Matamoros, of transportation in uninterrupted. Juarez X lines QX in the the blade X with

conducted associates and state associates multiple Rhode Iowa and our the already to Island there. same in our are have events mass offer in local authorities with Newton, for vaccination We working to

of the now have approximately On XXX growing we support opportunities out XXXX. in business, continuing the to build over of the the and and are since to order customer have side service team of an are beginning we the securing XX% increase technicians,

and in deliver transportation Mexico and we the vehicle electric manufacturers. passenger another quarter, up to multiple training this parts Our during in service European for perspective, continued New open From operating, Teresa, operations. to training we a Santa was our facility year facility Europe plan support to

Rhode customers portfolio We to times, product are cost technology expand solutions. quality, and are advanced and these scalability and pleased our with we to experience for our with line progress gaining demonstrate with the automated in repeatability, the Island production that cycle

collaborating and electric underbody are and thermal and to parts vehicle enable X lightweighting, panels structures enclosures weight, battery are delivery Class electric upfront We highly body parts. with of buses, Examples body and that lighter now on high reduced component investments with vehicles durability cabin include vehicle OEMs enable OEMs Examples X cabs are resistance. cabin to X structures related and capital body protection, structures. durable components of

leadership QX, our accelerate over and have and respect but to build of experience with in production We last execution are the seen logistics to our add no cost continuing availability challenges With deep quarter. our chain, some transportation materially automotive issues impacted we issues team our to supply continue the strategy. to to plan increases,

fabrics, feedstocks extreme resin extended Texas related maintenance due to experienced include fires, and and weather factory we the in carbon China addition and increases supply closures in outages unplanned In to in Europe. plant and fiberglass and to price epoxy consumables, which both February, constraints cold

done deliveries congestion impact prior the logistics and disruptions breadth actively job early see We market supply enable pandemic they through area And of have enough easing in and material and shortage will Los multiple continue operations Angeles phenomenal moment, opportunities speak to in a minimal finding our beginning out supply growth we team our are routes to to a pricing manage a Bryan in add the and constraints improve and We finding customers. QX. evaluating the demonstrated see chain alternative to finally, build expand our we engaged accelerate to of increases technologies to strength to has sources, business. during financial current and materials our costs. capabilities, securing our and opportunities logistics in the ports signs challenges, expect new to and as the the of global but to container are and the about and causing in excited

announcements wind the that Biden long the to call, market, significant has last our several term. the made administration relates over our since business could it positively impact As

a achieve and that by wind few: To installations First, transmission-targeted infrastructure tax direct for a electricity reintroduced pay to credit of of Wyden credit capacity with XX electricity either or to efficiency highlight least to credit the a bill XXXX. offshore aim extension technology-neutral facilities for carbon tax to would of the the would framework lines; in high-voltage X First, investment to option. XX wind, third, negative investment of that for administration by standard carbon-free build-out potential XX-year power of potential production components XXX% Relating XXXX; a the producers that growth Separately, has the the energy goal at with the clean announced tax gigawatts help many tax credit the a bill and U.S. proposed install incentivizes have a Senator gigawatts or allow an second, Biden accelerate qualify government-wide emissions. and production offshore

time. for Summit, administration Other Canada, part emissions approximately and half the Korea XXXX pass XXXX South while improve as Mac carbon XXXX increased Brazil, and through legislation a by call, of 'XX announced wind commitments we've forecast states XX% new the by from and its cut their requiring part member XX% that's the some suggests that up XXXX as emissions levels, a compared including to the for the Climate by last Paris for XX%. Japan, XXXX in U.S. Agreement. with that strength for markets well, as Finally, in a been U.K. and to of U.S. the its This has increase the alone. gas reduction onshore forecast competitiveness discussing countries, includes of and greenhouse XX%, the Climate Parliament goal increased as continues our Since Wood EU

announcements such policy not out stakeholders to the these installations PTC, signals strengthen, wind the continue longer-term future period. believe we energy the positive these out for may some the increase, to due the acceleration additional will and to While may cases, the We promote are as of and as potential given short-term clearly transition. other of goals to pushed initiatives to for installations very we and recognize see in developers the time strong benefits energy look cause the over incentives

as through do XX% XX yet our significant, will share market long-term $X including for the our not of of better and accelerating we potential discussions capacity, customers, utilities update Our with and revenue reflect developers, opportunity the targets owners. We wind long-term clarity energy goals, and gigawatts in asset impact wind us of develop the believe transition. is we billion

associates growth Finally, shareholder and focused ESG me long-term safety imperatives to that, we to our our the activities let and With drive turn health executing the while over call profitable operating Bryan. on on value. remain and of

Bryan Schumaker

today a basis Thanks, same XXXX. on to the comparisons period will Bill. Slide Please made to be compared in All turn XX. year-over-year

in $XX first wind in number $XXX.X increase XX.X% million Start-up $XX.X by increased This produced blades of year-over-year quarter average or million Net driven million XXXX, and as price of XX, sales by by to $X.X due the to wind ended to increased selling blades and we in transition blades increased costs to net was produced. mix wind million. XX.X% the an $XXX.X the blades our increase by XX% lines Mexico ramp transition March and continue primarily Turkey. the to bigger facility of for to million. an For sales India the quarter and

by and Our costs decreased expenses due to sales. $X.X for percentage points to decrease a basis decrease training was costs. sales to of X.X% administrative and reducing net XX million on in decreased COVID-XX quarter general of $X.X focus continued related and a million, This to the primarily and as net travel G&A our

was sales of and net share-based of XXXX, respectively. X.X% in and X.X% QX Before as G&A compensation, a percentage XXXX

million Turkish euro primarily foreign Foreign exposure compared QX loss of as QX in was due currency in $X increase lira. liability $X.X against XXXX. the to XXXX million to was currency This income

As flow Approximately is was XXXX a reminder, on a revenue denominated our basis, to euros. naturally hedged our QX exposure due XX% euro-denominated in of revenue in contracts. cash this

was forecasted jurisdictional mix $XX Our benefit for compared decrease income period. for year prior due tax This quarter of $X.X income. million to million our was primarily the as the to

a compared our for of forecasting the for described. million net was the be cash loss due same $X.XX XXXX. XXXX. $XX million as share $X.XX million in in share to per million are $X.X for same loss loss increase to quarter This net in previously to per for tax the Net the the XXXX. We to period approximately reasons quarter was Net $XX period to liability $X.X was a primarily compared loss of

XXXX. of adjusted rate utilization for net adjusted sales QX at lines with for end. EBITDA utilization Our adjusted or of million installed of net same a with $X.X was XX% that compares EBITDA to by quarter $X.X impacted X.X% during XXXX. QX was in COVID-XX-related or X.X% $XX.X the negatively EBITDA of This of in XX% million costs sales million estimate associated period and We

down driven leverage We million calculated of XX. net ended X.XX under credit cash net as Slide the ratio $XXX.X and $XX equivalents, with million of and to debt our cash than have debt agreement. less to quarter our Moving

you flexibility As to last credit recall, to to facility the financial may regards covenants provide COVID-XX our increased us manage year our through we liquidity help and with with pandemic. amended additional

period net early down. terminated our drive we the due our a quarter, adjustment ability to quarter to leverage ratio the During

covenants ratio of rates Following adjustments were adjustment the termination were leverage liquidity our the the and period, covenants mandatory to the and minimum net repayment were interest removed, triggers total decreased discontinued.

Turkey. plant quarter, we CapEx the Mexico our $XX.X During to lines continue and India in out incurred of build and as million transition we

XX. to Turning Slide

For in multitude specifically This saw costs to of increased are QX supply extreme XXXX. Europe. factors, The with facilities the come Capacity QX, extended resin we XXXX prices and blades late at February. XXXX. inbound we XXXX, like we cold into fires rapid that facilities in a put back outages To earlier. we the late on maintenance see including On in that Bill short-term raw average, to material. a costs reset prior weather timing of decline China to and bill in in it to makes manufacturing constraints reaffirming resulting this and QX will up due we have to resin are full of XX% customers, we resin approximately and of February in can year customers. prices, is the despite increases our When XX% resin resin any our online, adjustments manufacturing prices mentioned our in into at impact we to QX expect freight over contractually provided beginning increase margins guidance increases in commodity begin of from due Texas did price and end perspective, resin price is unplanned XXXX, prices resin when material with

million increases However, based such adjusted QX. on being only approximately will be that by our EBITDA contractual incurred with XXXX raw arrangements, $X believe we cost impacted material of majority the our in for

take and adjusted the expect As will QX our higher our in it the impacted adjusted that, slightly forecast QX, numbers questions. be for adjusted our will Bill? and at of COVID-XX. we than we'll generated your significantly Bill be look by to turn QX will QX. I of to wrap could over majority These remainder XXXX, and be EBITDA With back up, EBITDA we EBITDA then

William Siwek

Bryan. Thanks,

of families in Turning health live safety communities well our and as our which their as to they #X Slide priority. remain and XX. associates the The

safety on COVID-XX our of to in and front continue the working the ensure We associates to take conditions necessary the safe steps our facilities.

the We and with continue our made opportunities work wind progress pipeline, in to team service global we pleased the the space. growing have aggressively are and we in

new focused build exciting flexibility our energy the to environment current our a through number to on space and of our collaborative continue with remain the the acceleration provide agreements. security managing and as transportation We in execute capitalize strategy liquidity on development transition. drive financial momentum the to We we on of

breadth about excited to build to multiple business. and strength current opportunities out the to of evaluating are our we and are add We technologies capabilities and support the our growth,

decarbonize to mission overall Our remains electrify unchanged. and

to We global maintaining down chain all and a leverage will global to our efficiencies balance footprint while to sheet. continue using supply while optimize costs, drive for scale operating of continue our strong

here and and electric with wind excited position broader the our customers, we relationships our the vehicle tailwinds, market the industry remain for future Given our TPI. in at

our in that, for for commitments these challenging associates And for on deliver time enabling Thank open dedicated the resilience, again operator, Finally, to I their our your commitment want to thank today. you dedication times. TPI our their with continued please line questions. and for us and to customers

Operator

Craig-Hallum. our Stine of [Operator And line from question Instructions]. Eric first comes the with

Aaron Spychalla

It's Aaron on Maybe outsourcing. on Spychalla Eric. first for

or the look of some next so? year going seen things you the just we other chain over that's the here we've outsourcing and supply toward industry think on as trend that the dynamics, to Given strengthen do

William Siwek

Yes. suggest that I don't would think we've otherwise. seen anything

pipeline with lot So a we have a still pretty robust activity. of

we would So in or the that would seen any haven't reverse way. yes, suggest slow trend anything

Aaron Spychalla

recent and kind add of might maybe you trended, maybe on that we just more the a million All months, the Thanks $XXX maybe more many Can programs. of of in on those detail color right. as for number programs little how goal? conversations give look side. the progress have to how kind And on second, EV you towards

William Siwek

we've going Yes. of is quarter. interest, the conversations forward, It's agreements number added lot why over seen hard progressed have nicely. but lot to tell which how activity, add We've last very a of many we'll the a of clearly, obviously development a

think extremely I it's been So active.

body value component structure, We're where a people a parity the a place the starting be of composite to to whether lightweight nature or towards strength cost a getting are with the think we're I that'd down a proposition it. understand true model. working of and

I traction. some you'll see we think then more once there, get

Operator

of Sanchez comes Our from Morgan next question the Laura with line Stanley.

Laura Sanchez

in for little talk the challenges. impacts And the about came And Adjusted raw the quarter, level. also material about bit it hear a EBITDA the above OEMs guided you transportation from talked increased costs. we

challenges these to you factors there that unchanged? any are keep allow XXXX So offsetting guidance

William Siwek

Yes.

let I some number that think goals we're I think a cost-out on. of aggressive and But jump I'll got speak. one first, executing in on we've I'll then pretty that areas Bryan

we chain locking most of a our bit quarterly. paying we have of I everything material and the raw in with of almost kind cost our of when is virtually shared job else, exception sharing. adjust think, amazing a resin importantly, there year commodities a supply in you gain But our more about think we're that think I so talk increases, team just I But and does is of contracts, on in all advance. of an pricing in remember, locking

So our not on market commodities, increasing impact of but prices that some pricing may is. may you what actually these see

So the Bryan as we've impact suggested, from of of although resin, see other bit most locked will a an commodities, in we pricing.

there is impacting us it much increase So might than otherwise. any less

Laura Sanchez

does the reset? Perfect. get And sharing a how work? follow-up the that Or XX-XX does on How mechanism. that, often accounting about

William Siwek

it customer. But a handle the contract Bryan by accounting. let from varies I'll standpoint, bit Well, a

vary quarterly. across year, of adjustment, our it's we an the times customers, where just some have board. then so does customer So X of our it's another it's customers, some And annual it a

else or semiannually, most but X customer, year them you're X So and is -- quarterly everything are quarterly. of it's really, generally on

Bryan Schumaker

But a over we quite an if about smoothed the XXX accounting the it, you under look just keeping margins will this be hit the the life that mind. from the primary piece $X mean, contract, I year. in of in portion for And so the again, Yes. of it gets we talked at of that, bit, standpoint out the it then believe, which QX, that million, will

Laura Sanchez

reminder. so kind represent a sail manufactured any part -- is Yes, decarbonization blades, longer of I mean, Perfect. you and you potential the more I ocean term. last any that's remember you do Is shipping of for market the another started If in good longer being there one, would And of this see the shipping term? boats, before industry correctly, industry? wondering you power and if manufacturing potential I'm

William Siwek

No. We mean, for not -- been ships interestingly to oceangoing as approached wind. on ships something we've point. -- I we've some relates themselves, enough, we're that's this as unique propulsion really that far it But at as on systems no, focused the

Operator

And from Greg of line with BTIG. question our comes next Lewis the

Greg Lewis

was a the revenue. I little hoping to more around bit color get other

it you'd so the the that few like Knowing maintained have up side, kind leg of probably part body, chassis It next of that, color -- that think down, more to about You looks quarters? probably was like the that before on of picks around transport on going transport Any looks that up through flattish. that's the step that? the the way component any guidance just revenue kind to a roughly. of

Bryan Schumaker

gave about that X/X, Yes. earlier I I overall gave. guidance mean guidance of X/X, X/X the of kind the was total I

is in field there services. number with Now is that the

have that I see, increase on as focus bigger mean, a to continue we you'll So that.

drive period growing and continue why it, you going year. the will to up we're to over so the focus and continuing that see of that's that So

Greg Lewis

Okay.

in of thinking bodies -- kind of with still transport, as that think we about any in one should be then the I same? margin? where mean And when we think that, incubation OEMs parallel? around parts, either? other? mentioned then I be the kind think to leads of are and kind about going we about so growth the it's the you of the then be way the should kind phase, that there could they realizing Or X And we Or do of any think it be should differentiation something be as

William Siwek

there's grab fast that a whether asking component the and differentiation margin, grow or question? -- cab faster you're in will or then So is whether

Greg Lewis

Yes. Yes, exactly.

William Siwek

just I You in mean really -- know on both. Greg, it grows it depends faster. got clearly, opportunities which we've

takes as stuff imagine, longer be longer little Some you but of to bit might develop, run. the compared component, to cab the it a might

So to focused I hard We're a little think say. it's both. obviously on

of speed side be down also margin as you each. growth at and from the for which far what consistent as it's now, side, early hard not across lightweight, of more customers. this but the answer cost part mentioned, the a But tell bring on to depend in pretty as volumes be right be relatively past. because or wind margin, point, parity. requirements split be margins be kind of the only to And that's benefit it be will the a both. may working have the believe, will we're So of we're should just the to to cost are I I CapEx consistent but we better our a working on think, been And little the margins But what to our where with

Operator

next question the from Graham Price James. line of Raymond with comes Our

Graham Price

China. You spoke blade bit consolidating about potentially last in facilities quarter a your

kind guess in Just of wanted there updates any and the that any way? situation plays and on I check front, to COVID into see are if that if in

William Siwek

Yes.

we're Western got are for so OEMs, also, is in continuing as but to optimal from demand call, I other now, think footprint. having facilities only us OEMs. some look We've customers last the and Chinese the So we're X our situation still optimize of looking China what I and discussions there China to not mentioned we at based our existing with on the in

of on working footprint. still optimization we're So the the

in the period. the footprint as COVID And amount whole to relates what I as on there hit really the in or a there. impact impact least had China to it on operations doing we've that's it's us would COVID, I had we're I but COVID, throughout no relates mean, mean So of that. -- where leave very China it first,

for there. no COVID so us really And from impact

Graham Price

I for in specifically about it. balsa concerns wood. follow-up, guess, epoxy the And resin? thinking there, sourcing inflation to then Any addition Got my

William Siwek

We've balsa No, in market actually, significant last since drop seen the pretty a year. quite opposite. price for

we some year, this in from COVID, last the very today. into exacerbated point 'XX, we challenges and a of balsa had 'XX but at standpoint recall you at balsa good end and shape If by market are a

Operator

the question Gengaro And Stephen our of comes with Stifel. line from next

Stephen Gengaro

two So things me. for

The Just us year? ramp the higher little -- or first, of can half you back the in help which some a sort half? step of big the move of stair EBITDA major the the of versus components sharply bit drivers the the first in half with second what are the us

Bryan Schumaker

few have, Yes. about that it's right? on, minimal, the we from be which You There's a things going will is about is that raw but the talked impacting, the increase. that referenced one, material we $X.XX cost

India you up, ramp up. continue I portion, other mean, they'll ramping have so The to

I'll time lines And X QX transition from some, the that and revenue Mexico, of right that's also. seeing. Turkey, say, up now have those see We QX out in shift we ramping we're QX, big frame, across to back push will half year so be the that another

mean, So utilization out I going right see numbers. the of we it's to to achieve where in starting back that I fill and mean year we're half up coming feel, of to kind that now, those --

William Siwek

Yes.

the key is that's think I utilization. the

you'll see going here QX experienced first look at numbers that you and in much we higher sure. quarter If out than QX, numbers in for are utilization the the

Stephen Gengaro

When when relationships the you question. a about offshore offshore, you international Just for start timing. the give on when opportunity this I'm sense do U.S. a contracts, the to up side? follow-up, time lead -- we than book more what's as probably just with with the Okay. sort thinking for OEMs work the me set think of Great. And and

William Siwek

now. think cetera, discussions about U.S. have the East up you quite today and offshore, new time on Coast set so on a were specifically the mean some the for it of with the time it's Yes, in if OEMs land, been opportunities to I et takes cetera, we for right secure facility, et

now be likely would would it little We XXXX the now. 'XX we're a time happening -- in that's announcements maybe to shifted production thinking probably frame. right right, So early bit but expect with

long the a so. quite to by erected get turbines time and we lot a there's has So that water, in -- between time. There's now lead the happen the time

Operator

ISI. question of with comes the James next line Evercore Our West from

James West

you energy talked So Bill, Washington the and of and planned? this incremental it guys the around transition. caused this has ago And places number out lines you acceleration, of to policy-driven laid are policy or other have the have what kind also -- a that recent that within just about you are think changes has world for transition, minute in lines preparing a already you even about of from acceleration, sort But offshore. you accelerating

William Siwek

having with first and into No. et absolutely. I mentioned we're customers, question, and mean through with absolutely, Yes. Good and quarter customer's customers I and cetera. that's the in what But our discussions talks part of doing we've markets been XX be is, today X needs are, discussions years. quarter growth where next where it and long-term second the where or capacity understanding is the tomorrow planning over where customers the to is to having the needs

right locations as market, targets. the the installations in number of of the that then out parts different their to well, just putting demands to market. to exercise meet more people even be needed would there's amount hit more mean, there talk ongoing fruition, if certainly to than in the of going mean the in -- at the there's in and Europe -- And now. active or our I are that you an come that's look the But numbers some existing capacity So world if right? I it of need of Xx or U.S.

location where at the next of X footprint So deciding kind to that the be will yes, not over and be. is we XX may then or the may looking answer next months growth

James West

Okay.

is in quarter. have to Good a know already follow-up on third you the Okay. just you issue. Is expect the to I that supply -- come so resin cost And down that visibility then the maybe contracted, on hear. good that?

William Siwek

we So is move. what pricing secured can supply have

But based couple so or with reset right? you as can on strategic decrease, the our moves we suppliers, that customers, we've as prices pricing down, move. of price some on indices price come of sharing there's a the agreed So our a increase with as that the quarterly recall, price

Operator

[Operator Instructions].

of Our comes with next from Jeff question Osborne the Cowen. line

Jeffrey Osborne

had just I two on questions the Bill, quick EV side.

X So the are What's making those no? prototypes? customers you Proterra X -- the X volumes? contracted nature are X and in those is of the those Or you're people are that? and So referenced, like that or

William Siwek

of development were production production component OEMs. then you Yes. a so existing sorry, And there, But we've that side, Navistar the Proterra we obviously down -- it we that's the will. be would hoping arrangement contracted, them it's -- stuff to I'm X them a to plan lead -- anticipate will was most parts well. bunch in would development of more on and if there we've the got obviously that's of again, vehicles. phase for as again, production And there that a in, you have, there right? give are deals. lead road. -- are would is that And from the development, number where standpoint, And development cab of that to in that's they then with are Clearly, discussed

Jeffrey Osborne

something in for, X would my program do If for year, Or is of but panels what's years you to Rhode off the moving know bit it broader roughly a Newton, if you're ball F-XXX take CapEx I or memory forward Got getting door vision? quite implications of Because it. equipped had like right. the And the this? a for this Island seems that success sure with I like ago, to be done? DOE-funded a GM, vehicles making say, this wasn't Where million is sort Iowa? here,

William Siwek

Yes.

right in production now type that of. out got we running Island couldn't parts that of Island. production But we've no, Rhode -- the off Rhode that line of do we So volume pilot are

thought that Our we components near if here or is that, running would be plant. in customers' co-located our we either like likely were

customers what are co-locate that for that's the out, what have So But near be. locate But for those to to our doors. early for I like can't -- that be sure. would. be would of our to to types I'd tell yes, too F-XXX volumes today X opportunity million plan that would or we and CapEx -- tell you would where it's the clearly, figure certainly

Jeffrey Osborne

Makes sense. that of larger talked I question, on assembled still it, deployment? about on in factors. segmented an year a you're location since can at Or something on working And site you were with it's on? be that the form working that your blades you been probably us but the of Is last would think terms you blades customers' give update

William Siwek

Yes.

We are producing blades today. segmented

Operator

Greg Research. question the of with from next comes Our line Wasikowski Webber

Greg Wasikowski

transportation. I'll start with

the Just between OEMs, or cab EV if if any parts curious one. a and all I'm quick overlap there's they're OEMs individual. those

William Siwek

is overlap. some There

certain we're at components as cabs sure. So for as looking a for well them, couple of

Greg Wasikowski

Got it.

should years. segment? should Okay. the few know start agreements we for And partnerships, about next or to over we think and it this But conversion mix before how that? more Or add generally talked we more for we've about see thinking speaking, targets about seeing line or in then than in XX sooner collaboration When be growth period? the automatically how could months I P&L? backlog, the translation be plans should time add think we you relationships that as you longer-term any the and build to OEMs your additional

William Siwek

that to reason a say than it I these programs do originally little say just And think was bit patience. maybe development would longer to -- anticipated. the I production take is get I

XX and -- that structure to say, through could the sum, probably a So XX, I'd your production, get months, XX get cab phases like before to it in going you you point if you're more what as XX development you testing with have probably XX specifically. months it's be especially from through process,

So these a cycle for it long projects. development is

that to revenue from it's you we're XX project meaningful again, months production development seeing start of a out working deal so XX probably a before today. And on

Greg Wasikowski

Got it.

Okay. then And I could. one if more,

Just favorable somewhere at benefits. chain on your or as unemployment kind labor. supply stimulus I'm seen of base? any in I'm U.S., of customer constraints, either or thinking if within particularly, labor curious the checks you've TPI result a and just your

if anything you've seen there wondering all. Just at

William Siwek

In pandemic, in it's in a the we've challenges good of early we has Iowa, few -- but the the it on, part U.S., actually early shape. -- pretty had in been

just we're short it'd seeing But looking or significant answer is we're overall at point. workers. the of shape impactful checks challenges, because the this market. be labor skilled always answer unemployment pretty Now of not good for in or because whether -- no, the We're

Operator

comes UBS. question from next William of the line Grippin with Our

William Grippin

step So EBITDA into think guidance I the into a bit quarter, of like a little But the earlier. were second shift a gave being more. third then half second pretty guidance quarter, EBITDA. you of second wanted then I a new just last in of out in little talking This just to the seems strong, a bit dive implied of ramp you quarter half appreciate that down XQ I imply little -- significant to bit and XQ. and color about

But have $X like So the you from quantified India transitioning, guidance last million as costs. ramping, would stuff lines would known I higher think that gave quarter. X far you the as you when

to quantify understand us help just or help. color what's you any -- can So just here additional understand us that if help us help give would can you on going

Bryan Schumaker

Yes.

into part, again, pushed off QX, that QX. For most QX the into

Some of QX also the half softer about QX spoke being back helping the the maybe demand up little so of that's and a out in us we year. that is before, filling also

utilization is about. standpoint it material the we down, Some cost that this that for of from things that slipping. in driving us the raw demand key to QX that's it kind of give of are Part again, and But of why factories talked the part confidence. input a is

So that's main the factors part there. two of

William Siwek

firming of sense? that's to about push when -- half back XXXX, Well, we right? make -- right, on up. fourth a being filling still little little a demand that it's quarter so talked call, Well, bit So up, soft. a the the does Well, being we

into QX some anticipated And pushed And that from looks of the so that's QX, why is getting then better. volume we QX customer request.

William Grippin

I get sequentially? quarter Right. be lower in the Do think that. utilization will you second

Bryan Schumaker

necessarily of will higher online. because have you lower be India more sequentially. It Not coming

EBITDA the thermometer tell year. you I of you to adjusted give that why, just up goes little We mean, to kind that's try bit. a So overall throughout how it's progressing

Operator

Our ROTH. line next Shen with the of question comes from Phil

Philip Shen

I think also did I be impacted we've these majority and when the But say X. said know So and you could QX in the guidance that. about be sequence bunch you significantly numbers of talked a the Bryan, talking you're about would by EBITDA, COVID.

is that with COVID explore specifically I that? think So Or about talk a is preparing the what India's situation, Tamil you contemplated, a Chennai parts capital. in which head to I there bit can example, more. being the of how happen where Is case on little you possible more wanted shutdown countries? for Nadu, of a shutdown do for could And the for are guys believe of you

back to well. So maybe through as India half just and talk that might guidance risks what the be

William Siwek

Phil, Yes. Bill. this is

got -- a caveat risk you've global when typical factor, a right, Just it's pandemic.

you happens, if something know. So never

the it's we're as But And pandemic, very is we're still to we're are So restrictions in bit. We're actually -- at open. there India, our actually, but a monitoring although and chain India, is there shutdowns both specific closely. where to situation nonetheless, continued are has well. Tamil early There so we're -- in not watching and there very okay. now, like districts no between industry serious, Nadu and right There's curfews up it be there oxygen fine the supply throughout there. easing was

which we not we And changes have So doing point, on something we here an significantly have anticipate the we're at the But weeks. that we we production few this risk impact to over nor to down either that. had everything outbreak, production. do next an slow prevent unless is it can have

Bryan Schumaker

I'll will full only of of being of India call, kind the million We go With we million and is and we a Yes. seeing our gave about talked about thing that's $X.X $XX rate, because in in $X we're year, QX. Turkey. through prior in quarter The the believe COVID million our run what QX. kind add impact through

why $XX that's still million first we gave those through the numbers in that we're instead the half. now year just will So confident the go whole just about of

Philip Shen

I Okay. Bill. that, appreciate Bryan. Thank you,

I is the you just Do visibility talked see also improvement resin resin? talk we pricing? outlook? an what through Or Can is on the for if improvement in that logistics QX about logistics not, earlier. And there? think you the

William Siwek

Yes.

that not the we're I it, past a it, one, in think get the but that's down you pandemic, past road tougher middle further we're the the still Phil. of

I a and I our alternative on where job to continue get routes finding the XX I go. months. methods and XX rely need chain and to to I materials they've one. done they of ball we have on the tight balance remaining manage the phenomenal think to team, modes supply a this it just see last the crystal through have of but way we'll year, over don't

Philip Shen

so that that the production, the you the EV year. just it's not actual is Okay. last one. on some block? for looking of Can can talk time talk is to some economy, what that I And terms looking Perhaps Bill, serial you you know of to possible guys. for in we slated Great. entire live were the color then were through passenger isolated what QX production? road for year this status about -- and QX And converting impacts you guys in that and was

William Siwek

Yes.

the particular part we've other on on probably two the working -- options go part. with But serial programs. different to not program, not parts. earlier that about and spoke We're will So production OEM, under got one that to particular TPI. will with this was we had have we likely The serial go that still production

we're of of and serial a goes whether a pilot just The we working delivering of we'll QX. as now it's it's other And there well. of tens that parts full from to will be end QX, program whether early or on, thousands that between the production see kind

But and didn't particular for that one excited we're we're executing again, now -- So we see, dealing but high-profile we're volume. the the it's part, OEM still and And another a so on that on we'll one, with customer working now. on options. go that right opportunity, first It's serial. the other high about

Philip Shen

Can was first program? the you for explain cause what root the

William Siwek

as turned a as I part not anticipated went we structurally be different to the OEM think The out direction, need originally significant be. it to to

something need as didn't what they so structurally is, it But then our the as significant cost fine integrity. would they and remained originally they turns out a part was if needed believed. as structural that And result, as have

with went they that was technology So a cheaper. different

Operator

now are speakers. turn at this to will time. the further our no call There back over questions I

William Siwek

discussion. our again, look we Thanks in again. and you. appreciate Be to TPI Thank And safe. your Composites, interest next forward

Operator

does lines. disconnect for you that please you participation and your conference call for That the conclude We today. ask thank your