Quarterly report pursuant to Section 13 or 15(d)

Inventory, Net

Inventory, Net
6 Months Ended
Jun. 30, 2022
Inventory Disclosure [Abstract]  
Inventory, Net INVENTORY, NET
Inventory, net consisted of the following:

June 30, 2022 December 31, 2021
Raw materials $ 58,629,245  $ 66,238,615 
Work in process 23,991,215  20,826,644 
Finished goods —  — 
82,620,460  87,065,259 
Less: inventory reserves (70,063,141) (76,997,892)
Inventory, net $ 12,557,319  $ 10,067,367 
We reserve inventory for any excess or obsolete inventories or when we believe the net realizable value of inventories is less than the carrying value.
As of June 30, 2022 and December 31, 2021, the Company recorded inventory reserves of $70.1 million and $77.0 million, respectively. During 2021, the Company significantly increased its inventory reserves due to its decision to produce the C-1000 vehicle platform at low-volume and transition to a new all-electric delivery truck platform in the future. This decision was based on results of extensive testing performed on the C-1000 vehicles, which concluded in early 2022. The $6.9 million decrease in inventory reserves as compared to December 31, 2021 is primarily driven by the Company’s efforts to dispose of inventory that is not expected to be used in future production.