Nikola Motors' big electric refuse truck deal just collapsed
Nikola Motors' dire 2020 isn't quite over, with the cancellation of what was arguably its highest-profile electric truck deal sticking the knife into the troubled would-be Tesla rival. It's the end of Nikola's short-lived dream of building zero-emissions refuse trucks for one of the biggest names in the trash and recycling business.
Back in August, the deal announced between Nikola and Republic Services seemed like just another example of the automaker's unexpected race to fame. The companies would co-develop a custom refuse truck, built on an electric platform, with Republic filling the order books for at least 2,500 of the EVs for use across its markets in the US.
Total range, Nikola suggested, would be up to 150 miles on a charge. The refuse trucks would also have almost three times the power of natural gas or diesel versions, not to mention be notably quieter. It was also billed as a breakthrough in trucking more generally, for a market more used to ordering separate bodies and chassis and then facing the further expense of combining them.
Today, though, Nikola and Republic Services announced that the whole deal is off. "After considerable collaboration and review, both companies determined that the combination of the various new technologies and design concepts would result in longer than expected development time, and unexpected costs," Nikola confirmed. "As a result, the program is being terminated resulting in the cancellation of the previously announced vehicle order."
Nikola had been gung-ho about the potential for its technology in the segment. Road testing of the new truck designs was expected to begin in early 2022, with full production and deliveries to Republic from 2023. The deal included provisions to expand orders to as many as 5,000 of the electric trucks.
Nikola's stock price (NKLA) fell sharply at the news of the cancellation, dropping almost 10-percent today. It continues a downward trend for the automaker, which has seen highs of almost $94 a share come crashing down to a sixth of that.
The high-profile exit of company founder Trevor Milton – amid allegations of fraud – in September marked a key turning point for the company's fortunes. By November, General Motors was pulling back on an earlier deal, with Nikola cancelling plans to build its Badger pickup truck, and GM scrapping its $2 billion investment into the smaller company. Instead, Nikola will be just another customer for GM's hydrogen fuel cell technology.
It'll use that, it insists, for the EV trucks it intends to begin production of in Arizona come 2023. Before that, foreign-made Nikola Tre battery-electric semi-trucks are on the company's roadmap for 2021.