Nikola’s Electric Big Rig Beats Delayed Tesla Semi To Market

Nikola Inc. aims to be a leader for battery- and hydrogen-powered heavy trucks. It has started production at its Arizona plant of electric semis, getting to market at least one year before Elon Musk’s delayed Tesla Semi.

At the Coolidge plant of the company, located about an hour from its Phoenix headquarters, Wednesday marked the beginning of commercial production of Tre trucks powered by battery-powered batteries. Governor Doug Ducey joined the ceremony, which was held in Phoenix. Ducey convinced the company to establish operations in Arizona. The initial phase of the plant is 250,000 square feet. It currently produces one truck per day. Tre BEV production will be boosted to five by a 160,000 square-foot expansion near completion. Tres will be powered by hydrogen in the second phase of the factory’s opening in 2023.

Nikola CEO Mark Russell stated that the company was a pre-revenue startup and that all of our expenses were financed by investors. Today marks the day we begin customer deliveries. We have trucks we can deliver to customers and get paid for them. We are now a revenue-producing business and will continue to be so.

The current low production pace means that revenue will be limited for the next few quarters. However, it is remarkable that Nikola has made it this far, considering its turbulent history. The Securities and Exchange Commission charged Nikola founder Trevor Milton with lying to investors regarding the company’s technology and market readiness. Milton denies the charges. The company paid $125 million in fines to resolve the matter, and Milton is seeking to recover a large portion of that amount.

Russell’s leadership has helped the company improve its relationships with industrial partners, including Iveco (which supplies the Tre’s chassis) and Bosch (working with them on hydrogen truck fuel cells). Last year, the company began testing battery-powered Tres at Los Angeles Port and is targeting Southern California, where it qualifies to receive an incentive for clean heavy-duty vehicles of $120,000 each truck. Each truck can be purchased for hundreds of thousands of dollars, although the company has not disclosed pricing details.

Nikola claims that the Tre, a European-style day cab, has the most extended range of any semi-electric on the market. It can travel 350 miles on a single charge using its 753 kWh battery. This battery is larger than any other current electric models, such as the Peterbilt, Kenworth and Freightliner electric models, BYD Volvo, Lion Electric, and Freightliner electric models.

Musk unveiled the Tesla Semi in November 2017. He claimed that the Tesla Semi would be able to travel 500 miles per charge and could go on sale as early as 2019. Since then, it has been delayed at least twice. Musk suggested that it could arrive in 2023 after the production of the Cybertruck pickup is completed, this month at Tesla’s Giga Austin facility. The Model 3 was delayed due to a company decided to concentrate on more profitable vehicles like the Model 3 or Y, and the challenges that the company faced scaling up production for its 4680 battery cell.

Competitors have also made it to market faster than Tesla in other segments, including big rigs. Rivian, an EV startup, was able to go to market first with the R1T model after Musk delayed Cybertruck production until 2023. Ford began shipping the much-anticipated F-150 Lightning, a battery-powered variant of America’s best-selling vehicle, to customers.

Nikola will make Tres powered by batteries in Arizona and produce the truck for European customers beginning next year. The production line was set up at an Iveco factory in Ulm, Germany. This is a reverse of Nikola’s original plan from a year ago. Russell stated that although we initially thought we would export first from Germany (to the U.S.), I have seen things change, and now we don’t believe we will. “Moving things across oceans is not a way to make money.”

Nikola’s plant is about 20 minutes away from Lucid Motors, a fellow EV startup. Lucid Motors recently started building high-end electric Air sedans at Casa Grande. South Korea’s LG Energie Solutions announced plans to start making lithium-ion batteries in 2024 at a new plant it will build in Queen Creek. Queen Creek is a suburb of Phoenix.

Nikola uses Samsung cells, but last year said it would also source them from LG. The new LG plant is close by will give it an advantage. Russell stated, “On a cell basis, we like Samsung,” and “we like LG.” LG “should be our cheapest source of supply-and the best quality.”

Nikola shares closed at $7.46 on Wednesday, down 2.6%. The company will release its first-quarter results on May 5.

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Adam Collins
Adam writes about technology, business and economics. With master's degree in Economics, he's presented six papers in international conferences. As a solivagant in the constant state of fernweh, curiosity is the main weapon in his arsenal.

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