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

Company: REE Automotive Ltd.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 20
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 postponement of the application of certain tariff amounts on China. Tariffs and trade wars, or the threat thereof, between the U. S. and countries such as China, Canada, Mexico, the UK, the EU and other countries has disrupted global supply chains, raised our supply costs, and has adversely affected our ability to execute key elements of our strategy. This can also impede the transition to electric vehicles and/or delay the implementation of economic competitiveness policies. More specifically, we purchase various battery types for our products from certain suppliers based in China, which is more subject to risks associated with international trade conflicts between the U. S. and China, particularly with respect to tariffs and export and import controls and laws. In addition, we manufacture our REEcorner in the UK.

Because various items in our supply chain are, and may continue to be, subject to tariffs, we have experienced significant cost increases with respect to our vehicle production, which we believe were unexpected, unforeseeable, and unpreventable. As a result, we have had to delay our vehicle production and expect such tariffs (including the surrounding uncertainty therefrom) to continue to significantly impact our business, operations, and vehicle production goals. If we

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return to production of our vehicles and are unable to pass the costs of such tariffs on to our customer/end-user base or otherwise mitigate such costs, or if demand for our vehicles decreases due to the higher cost, our results of operations and overall financial performance could be materially adversely affected.

Moreover, although REE does not operate in Russia and Ukraine, and there are no plans to launch in either market in the near future, the ongoing conflict between Russia and Ukraine creates geopolitical uncertainty, increased sanctions, and other potential impacts on the global economic environment and may impact customer behavior and disrupt the manufacturing, delivery and overall supply chain or our ability to commercialize REE’s products, which could make it difficult for REE to forecast its financial results. The uncertainty surrounding these conditions and the current, and potentially expanded, scope of international sanctions against Russia may cause unanticipated changes in customers behavior and may impact operations of our suppliers. Sanctions have also created supply constraints and driven inflation that has impacted, and may continue to impact, REE’s operations and could create or exacerbate risks facing REE’s business.

While REE’s “ Tier 1” supplier contracts prohibit certain items sourced from sanctioned countries including Russia, vehicle production is a complex process, with thousands of components sourced from all over the world. There can be