Company: REE
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001628280-25-025661
Chunk: 49

Company: REE Automotive Ltd.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 49
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 for many employees to belong to a union, which can result in higher employee costs and increased risk of work stoppages. REE may also directly and indirectly depend upon other companies with unionized work forces, such as parts suppliers, trucking and freight companies, shipping yards, and docks, and work stoppages or strikes organized by such unions could have a material adverse impact on REE’s business, financial condition or operating results.

Risks Related to Litigation & Regulation

REE’s financial and operational projections with respect to its P7 lineup rely in part on existing and future regulations and incentive programs supporting EV adoption.

There has been growth in the adoption of environmentally driven regulations and incentive programs with low and zero emission targets with the automotive industry being among the most impacted industries. Such measures encourage local and national governments to implement various forms of rebates and credits for the purchase of an EV. In addition, regulations in certain cities, states and countries are also encouraging a shift away from - or in some cases banning entirely - fossil fuel-powered vehicles, with many of the earliest of these regulations targeted at buses, trucks and delivery vehicles. REE’s financial and operational projections with respect to our P7 lineup include the continued growth in existing and similar regulations and incentive programs to accelerate the adoption of EV technology into the wider market. There is no guarantee that such regulations and incentive programs will be successful in encouraging adoption of EV technology. Additionally, any unavailability, reduction, or elimination of government and economic incentives and credits because of policy changes, or the reduced need for such incentives and credits due to the perceived success of EVs, policy shifts, or other reasons, may result in the diminished competitiveness of the alternative fuel and EV industry generally or our vehicles (if and when we resume manufacturing them), software and services in particular. Additionally, federal, state, and local laws may impose additional barriers to EV adoption, including additional costs. Any of the foregoing could materially and adversely affect the growth of the alternative fuel automobile markets and our business, prospects, financial condition, results of operations, and cash flows. For example, on January 20, 2025, President Donald Trump signed an executive order titled “ Unleashing American Energy” that paused certain disbursements of funds appropriated through the Inflation Reduction Act of 2022 and the Infrastructure Investment and Jobs Act, which may have direct implications on the policies and regulations that impact the automotive and transportation industries. This order seeks to rescind waivers granted by the Environmental Protection Agency, or EPA, for California's zero emission vehicle