Nikola Pushes Hydrogen-Truck Plan

"As Nikola Corp.'s founder stands trial on securities-fraud charges, a revamped management team is pushing to make the company the first to market hydrogen-powered commercial trucks in the U.S. -- and to overcome production and credibility challenges that have weighed on its shares.

The company's first battery-powered electric trucks rolled off the assembly line this year. Nikola said it plans to begin producing heavy-duty trucks powered by hydrogen fuel cells next year. The Arizona-based startup said it has orders for about 1,500 trucks in total for its battery and hydrogen fuel-cell models, designed to pull semitrailers with freight.

Nikola's current order volume is far below the 14,000 hydrogen fuel-cell truck orders the company reported in 2020 when investors' optimism soared over Nikola's potential to dominate the market for electric heavy-duty trucks as Tesla Inc. had done with electric passenger cars. Nikola's orders at the time were mostly nonbinding. Nikola's stock, which has been falling for months, recently sank to a new low below $4.

Trevor Milton, who founded Nikola in 2015 and served as CEO until 2020, captivated investors with forecasts of $10 billion in potential revenue from early orders. Nikola merged with VectoIQ Acquisition Corp., a special-purpose acquisition company, and went public in the summer of 2020.

Shortly after the stock's debut, investors began questioning the timing for turning orders into revenue. Mr. Milton resigned as executive chairman in September 2020.

Nikola in late 2021 agreed to pay $125 million to the Securities and Exchange Commision to settle allegations that it defrauded investors. In July 2021, the Justice Department charged Mr. Milton with securities fraud and wire fraud. He pleaded not guilty, and his trial in a New York federal court began in September.

The company, with new leadership, is looking to recapture momentum by making progress on its plan to distinguish Nikola by offering leases on hydrogen-electric trucks that include the hydrogen fuel.

"The unique proposition that Nikola brings is that, as we introduce the trucks, we will also introduce the hydrogen-fueling infrastructure to support those trucks," said Pablo Koziner, who was promoted in August to president of Nikola's commercial business.

The trucking industry has long been interested in hydrogen's potential as a lighter-weight alternative to batteries. But there currently is limited availability to fill up trucks with clean hydrogen made from zero-carbon or low-carbon processes.

Under CEO Mark Russell, who took over in 2020 and plans to retire in January, the company has taken a more restrained approach to disclosing orders that it can fill. Nikola reported just over 1,000 orders for its hydrogen truck in April. Anheuser-Busch Cos. signed up for 800 of those trucks as part of Nikola's lease program.

Nikola executives said they are counting on the company's battery-powered truck -- known as the Tre BEV model -- to raise Nikola's profile in the truck market." [1]

1. Nikola Pushes Hydrogen-Truck Plan
Tita, Bob. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 03 Oct 2022: B.4.