26-year-old CEO completes SPAC deal and brings his autonomous trucking start-up Embark public
- The congestion at U.S. ports, the trucker shortage and the rise of e-commerce have created a unique opportunity for autonomous trucking, Embark Trucks CEO Alex Rodrigues told CNBC.
- Embark has completed its SPAC merger and will begin trading Thursday on the Nasdaq under the ticker EMBK.
- Rodrigues will also become one of the youngest CEOs of a U.S. public company ever at 26 years old.
The congestion at U.S. ports, the trucker shortage and the rise of e-commerce have created a unique opportunity for autonomous trucking, according to Alex Rodrigues, CEO of Embark Trucks, which has completed its SPAC merger and began trading Thursday on the Nasdaq under the ticker EMBK.
Shares of Embark were down roughly 12% on their first day.
"What we've heard from investors is people are really understanding the need here and there is a huge amount of excitement about the potential to revolutionize the way logistics works," Rodrigues told CNBC. "We are really at an inflection point now, where it's really starting to effect everyday people and you know when people can't get their Christmas present, the need for a solution become a lot more urgent."
Embark, founded in 2016 by 20-somethings Rodrigues and Brandon Moak, focuses on the software and supporting tech for autonomous trucking. Embark can convert current truck fleets into autonomous fleets and works with carriers and truck manufacturers, instead of developing its own vehicles. According to Embark's website, the company's autonomous tech can improve fuel efficiency by 10%, reduce delivery time by 40% and increase revenue per truck by 300%.
In June, Embark announced it would combine with Northern Genesis Acquisition Corp II, a special purpose acquisition company, in a $5.2 billion deal.
On Thursday, Embark expects to raise approximately $614 million in gross cash proceeds, including a $200 million private investment from Knight-Swift Transportation Holdings, the nation's largest trucker, along with venture capital firms Sequoia Capital and Tiger Global. Rodrigues will also become one of the youngest CEOs of a U.S. public company ever at 26 years old.
Embark is the latest in a wave of autonomous trucking companies to go public in 2021. TuSimple's IPO was in April, and it's now working with UPS on lanes for autonomous package delivery. Aurora Innovation went public this month in a SPAC merger.
One deal has fallen apart. Self-driving truck start-up Plus and Hennessy Capital Investment Corp V said Monday they called off their merger, which was announced in May.
Wedbush forecasts approximately $750 billion will be spent on commercial autonomous vehicles over the next five years. Embark is partnered with AB InBev, brewer of Budweiser, Werner Enterprises, a trucker for big-box retail stores, Ryder and DHL, and others as all industries look to reduce supply chain spend.
"I think we are really gratified that the industry recognizes that we come to this as a quality partner and we've been able to build partnerships with some of the best in the business," Rodrigues said.
Walmart announced this week it's using fully autonomous trucking to move online grocery orders through a partnership with start-up Gatik.
Rodrigues believes it's another tail wind for his company and autonomous logistics. "Big established players understanding the urgency and the need for this technology. We see that as a big positive."
Correction: Plus and Hennessy Capital Investment Corp V said Monday they terminated their merger agreement. An earlier version failed to reflect that development.