Nikola Eliminates Truck Deposits, Expands Initial Fueling Network
Nikola Motor Co. moved to differentiate itself further from rival Tesla Inc. by no longer requiring deposits on its upcoming trucks and returning deposits it has collected as it prepares to announce a major new fleet customer in early May.
The company intends to refund each $1,500 deposit within 60 days.
At the same time, Nikola recently placed a second order worth $5.5 million with Sweden-based Nel for additional engineering, electrolysis and fueling equipment to expand Nikola’s emerging hydrogen fueling network.
Nikola is developing heavy-duty trucks that use hydrogen to replenish a battery-charging fuel cell. The company said last year it had raised $110 million in financing and intends to secure an additional $500 million to $750 million from strategic and institutional investors in 2019.
“A lot of people had asked if Nikola was using their deposit money to fund its operations. We never did. We always kept it in a separate account,” Nikola CEO and founder Trevor Milton told Transport Topics. “So we’ve never used a single dollar of any deposits in our company ever. But because Tesla did, people assumed Nikola did as well.”
Tesla announced earlier this year it will build an all-electric Class 8 truck in 2019 powered by an estimated 15,000 pounds of lithium batteries. Several hundred orders have been placed with Tesla, each requiring a $20,000 deposit, according to reports.
Meanwhile, Nikola plans to introduce a new “very large” fleet customer May 2, Milton said. He declined to provide further details.
Nikola has 9,000 online orders for its sleeper and day cab model Class 8 trucks, he said, and will begin field tests with fleets around the fourth quarter of 2018 — with production coming in 2021.
Nel reported its latest sell brings the total value of its contracts with Nikola to about $9 million, with delivery of the stations in the second half of this year and into 2019, according to Nel.
“We look forward to supplying the demo stations, which will lay the groundwork for the world’s largest, most efficient network of low-cost hydrogen production and fueling sites,” Nel CEO Jon André Løkke said in a statement.
Nel is a global, dedicated hydrogen company, delivering solutions to produce, store and distribute hydrogen from renewable energy. Nikola will provide the balance of plant, construction, dispensers and other station equipment.
Milton outlined an initial fueling network of potentially 28 stations built around dedicated lanes and regional hauls for fleets and owner-operators in a five- or six-state area.
“We have thousands of trucks on order for [carriers running] dedicated routes,” he said. “What we will do is put in 10 or 20 stations for that area. When our stations come online they are already at 100% capacity,” he said.
However, “If you are looking to do cross-country right now , you are going to have to wait.” It would take up to eight years to get the whole country covered with fuel stations, he said.
Beginning in 2021, the first 5,000 trucks will be built in Tennessee at Fitzgerald Gliders, an early investor in Nikola.
Nikola announced in January it will relocate its headquarters from Salt Lake City and build a 500-acre, 1 million-square-foot production facility on the west side of Phoenix, with development projected to begin by the end of 2019.
As production ramps up, national sales and service will be handled by Ryder System Inc.
Thompson Machinery, a Caterpillar dealer and an early investor in Nikola, also will offer sales and service in Tennessee and Mississippi.
Other large companies involved in developing Nikola’s trucks are Wabco Holdings Inc., which has invested $10 million in Nikola; Meritor Inc. and Bosch Group.
