Nikola Corporation NKLA recently issued a statement underlining key elements of the company’s strategy and production targets that are helping it achieve its goal of becoming a global leader in green transportation. Following the statement, Nikola’s shares rallied 14.5% to close at $20.48 on Sep 30.
The statement came right after Nikola’s founder and former executive chairman Trevor Milton voluntarily resigned from the company last week. This shocking split was announced after the short-selling firm Hindenburg Research accused the electric-truck maker of fraudulent practices within the company. Though Nikola claimed that the allegations were false and misleading, its shares tumbled more than 40% over the course of that week. (Nikola in Murky Waters After Milton Steps Down, Shares Drop)
Highlights of Nikola’s Latest Statement
Nikola stated it “remains committed to achieving” a set of milestones originally configured by the company. With the unparalleled assistance from its business partners and suppliers, Nikola is determined to implement the company’s vision to become an integrated carbon-free transportation solutions provider.
Per management, its business partners and suppliers will aid in significantly reducing implementation threats, meeting commercialization timelines and developing long-term competitive superiority.
Nikola has industrial partnerships with Bosch group of companies and CNH Industrial CNHI, and is working with companies including Nel Hydrogen, Meritor and South Korea’s Hanwha Solar.
Nikola anticipates that the first batch of the five prototypes of the Nikola Tre — a 100% battery electric truck — will be completed in the upcoming few weeks at its joint-venture facility in Ulm, Germany and further tested in the country. The firm is optimistic about commencing production as well as sale of the Nikola Tre by the fourth quarter of 2021.
This Arizona-based trucking giant is encouragingly focused on the establishment of hydrogen fueling stations in order to advance hydrogen fuel-cell based transportation. Nikola is also actively collaborating with industry-leading companies, including Nel Hydrogen, to develop a national hydrogen fueling network. Nikola’s hydrogen fueling network will offer secure and cost-efficient fueling to customers, and act as a key driver in making hydrogen as a sustainable energy source for the automotive industry. This also positions the company as the fastest mover in the hydrogen vehicle space — a technology that has not been widely adopted by the market due to lack of fuel stations and extravagant components needed for the zero-emission powertrain.
Nikola is on track with the development of its 1-million-square-foot plant in Coolidge, AZ. The company expects completion of Phase 1 of construction by the end of 2021, with entire completion to be achieved by mid-2023.
Moreover, the company predicts beginning the testing of prototype versions of Nikola’s hydrogen fuel-cell powered big rigs with customers by the end of 2021, followed by commercial production commencing at the Coolidge plant in 2023.
Nonetheless, Nikola has decided to delay an in-person event called Nikola World that was scheduled to be held in December. At this event, the start-up was set to showcase its vehicles and battery technology, including the Badger pick-up truck. Though the company has blamed the pandemic-induced restrictions on large gatherings for the delay, the delay comes in as Nikola is currently dealing with allegations of fraud.
The company failed to provide any update on its recent alliance with General Motors GM for engineering and manufacturing Nikola Badger, a fully-electric and hydrogen fuel-cell electric pick-up truck. Per the deal, General Motors will acquire an 11% stake worth $2 billion in Nikola as well as the right to nominate one Nikola board member in exchange for its in-kind services. The agreement was anticipated to be finalized by Sep 30, but recent allegations of fraud against Nikola have delayed the deal.
Hydrogen-truck upstart Nikola — often dubbed as the “Next Tesla TSLA” — was all set to heat up the EV race, until the report from Hindenburg Research surfaced. It is to be seen whether or not Nikola manages to win back investor confidence with its latest statement, which reaffirms its business plans and production targets.
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