MULN falls more than 8% on Tuesday

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• MULN stock loses another 8% on Tuesday, down 39% over past month.
• Mullen Automotive filed response with the Customs & Border Protection agency.
• Mullen ONE appears to be in the running for a federal contract alongside Rapid Response Defense Systems.
• Shareholders look ahead to vote on reverse split on December 15.

Mullen Automotive (MULN), a popular electric vehicle (EV) penny stock, descended more than 8% on Tuesday. Shares of the California-based company have trended 39% lower over the past month as the market awaits a shareholder vote on another reverse split scheduled for December 15.

The stock pulled back to $0.1620 in Tuesday’s session, down 8.7%, while the US stock market started off mixed but has produced light gains just before lunchtime.

Mullen stock news: Response for Mullen ONE filed with US Customs & Border Protection agency

On Monday, MULN stock closed slightly higher on news that it has filed a response alongside Rapid Response Defense Systems with US Customs & Border Protection (CBP), the federal agency that enforces law regarding customs duties, immigration and international trade.

The filing is a response to CBP’s questions regarding the sourcing of components used in the manufacture of Mullen’s Class 1 EV cargo van – the aptly-named Mullen ONE. The cargo van is manufactured at the company’s plant in Tunica, Mississippi, but uses parts sourced from distributors in South Korea, Germany, Romania, China, Canada and the US. 

Rapid Response is a federal government contractor that is party to a $2.7 billion contract for federal vehicles with the General Services Administration. The company sources equipment and supplies for the US intelligence agencies, the Department of Defense and a number of other federal agencies such as CBP.

Back in March, Rapid Response named Mullen as its exclusive provider for Class 1 EV vehicles since the Mullen ONE is the only Class 1 EV available in the US market. 

“With the federal government’s strong interest in electrifying a growing portion of its vehicle fleet, Mullen’s commercial portfolio is very well positioned,” said Fred Bouman, Rapid Response’s SVP – Federal, in a March statement.

Mullen will join Rapid Response in showcasing the Mullen ONE at a government vehicle conference in January 2024. Any large-scale contract with the federal government would be a big boost to Mullen’s reputation, as well as its balance sheet. 

At the moment though, shareholders are focused on the December 15 meeting, wherein CEO David Michery will attempt to get the votes to enact the third reverse-stock split of the year. As per an agreement with the NASDAQ exchange, Mullen needs to raise its share price above $1 by late January of next year. The board has already approved a ratio of between 1-for-2 and 1-for-100.