And it’s something that we’re keeping a close eye on because we saw something similar during the pandemic. This is when our sales went from about 95%-plus China-based to about 90%. So even in just a year or two, we saw a decrease. But we saw a reversal of that because though the aspirations were optimistic, it was — countries found it very challenging to ramp up manufacturing so quickly and the quality impact were very devastating to some companies, and they reverted back to us or adopted us new. So yes, we have been expanding our clientele. We have been expanding our market share but it’s still something that we are keeping a close eye on, exactly how that shapes out.
Rommel Dionisio: Okay. That’s very helpful. Just as a follow-up question, I wonder if you could just share with us an update on the Maryland facility. Any lessons you may have learned, any unforeseen challenges and how the — it’s been up and running a little while, what — how it’s all going? Thank you.
Raymond Wang: Absolutely. The Maryland site itself is coming along extremely well, and it’s ready to go for production right now, both for our heavy equipment and we’re expanding on manufacturing for mobile DC chargers as well to support HEVI energy. We have the full capability right now to be able to assemble the heavy equipment at the Maryland site. And from a capability standpoint, we are still on target and on track to deliver that first unit assembled in beginning of Q3. However, our production is — our production goals and plans were predicated on a sales model that may have been a little too aggressive from a time standpoint. As I mentioned, we did underestimate the overall sales cycle for brand-new electric heavy equipment.
When we compared to our air-quoted peers in the industry, trying to pioneer electric school buses, electric garbage trucks and tractor trailers, non-incentive-based purchases was over a 14-month sales cycle for them. Our original estimates were nine. So this does present a challenge for us. This is why we moved our first assembled products from Q2 to Q3 because we didn’t want to ramp up that site just to turn it down if the sales weren’t there. So we have the capabilities, the site is ready to go. We just need the sales to drive it.
Rommel Dionisio: Great. Okay. Congratulations on the quarter. Thanks.
Raymond Wang: Thank you very much.
Operator: Thank you. [Operator Instructions] Our next question comes from the line of Graham Mattison of Water Tower Research. Your line is open.
Graham Mattison: Hi, good afternoon, everyone A question — it’s great because there’s more progress going with the demonstration and you’ve got more out there. Would you say that — the second quarter versus the first quarter and maybe even where that is today?
Raymond Wang: I’m sorry, Graham, you might have cut out there. I heard would you say and then it cut out from there. I apologize.
Graham Mattison: No, I’m sorry. I apologize. I don’t know. I was actually just asking — is this better?
Raymond Wang: Much better, yes.
Graham Mattison: Okay. Great. Sorry about that. In terms of the demos that you’re doing, how is the pace of that compared to the prior quarters? Are you seeing an acceleration of that? Or is it leveling off? Or is there room to even push it further?
Raymond Wang: The demand is actually growing, especially as we conduct more proactive sales campaigns and more incentives are introduced into the field. So the demand has been growing. Our pace has been ramping significantly. We’re doing three demos where in the past few quarters, it would have been one, just because of the duration of our demos. And the room to grow is significant. We would anticipate — we would need probably another 6 to 10 more units to be able to meet the needs of the demand as we receive them. So that’s been extremely strong. The chargers and the incentives are expanding our sales process for the next steps from those demos, which we were extremely happy to see. A lot of times with the demos, the interest was there.
However, getting them to pursue a sales agreement was met with some hesitation as they wanted to conduct further research to look at other options for sustainability in the sector and really just validating our statements, efforts in terms of is there any other players in the field, things of that nature. And we still keep good contacts, it just extended this time frame. Now with our mobile DC chargers solving that infrastructure problem, with incentives addressing the financial concerns with deadlines as well, that’s actually been changing the game for us, and we are having very meaningful post demo conversations as well.
Graham Mattison: Great. And then do you still plan on using the authorized service centers? Are you still looking to develop those? And has that helped anything on the sales front?
Raymond Wang: Yes, we have. We actually have already signed. Right now, it’s about four — it’s about — I’m sorry, it’s about three companies right now that are officially signed on board with the authorized service provider network, primarily in New Jersey, but it’s something that we continue to expand on as well. And once we actually have a solid footprint, we were going to do an announcement along that. But it is no secret, we actually already have signed on board some companies that range from truck repair and rental sites all the way towards heavy equipment rental companies.
Graham Mattison: Great. And then last question, is there any update — last quarter, you spoke about the United Rentals program you had, and then I think you were talking with some other sort of fleet management or large rental companies. Any updates you can give us there?
Raymond Wang: Yes. The United Rental pilot demo is still ongoing. We completed a demo for our larger unit, the GEL-5000 and now we’re about to initiate a new demo with the smaller loader, the GEL-1800 and they want to go through our product line just to get a better comfortability with the product line and to better understand the marketability as well through their sales team. So that’s still active and progressing very nicely. In addition to that, both on a large fleet standpoint, we are making significant process and demos with other national rental organizations and brands, port operations, agriculture, waste management and public work yards as well. However, at this stage, they actually prefer to remain unnamed. But I can assure you that we are making some significant progress there, and we’re very optimistic that, that will bear fruit.
Graham Mattison: All right. And just in terms of how those programs typically work, you start with sort of a demo and then they shift to a pilot before making an order. Is that the right way to think about it?
Raymond Wang: Yes, that’s correct. It typically goes with the product demo over to a purchased pilot phase. And then if the product performs to their expectations from both a performance maintenance and financial standpoint, then they’ll pick up larger adoption.
