Nikola Corp NKLA CEO Steve Girsky said on Friday that the EV truck company is not concerned about competition from rival companies including Tesla Inc.
What Happened: One of Nikola’s customers started their transition to EVs by purchasing six battery-electric trucks from a rival EV player but received a range of only 150 miles though they were promised 220 miles. Furthermore, the trucks were taking them an hour and a half to refuel, Girsky said, making them turn to Nikola.
“…now they’re the biggest owner of our trucks, frankly,” Girsky said on the company’s second-quarter earnings call. The CEO was responding to a question on competition from rival truck makers, including EV giant Tesla which already has a pickup electric truck in its Cybertruck and is looking to start producing its Tesla Semi truck next year.
Fuel cell trucks could be more efficient than battery electric trucks depending on the routes being taken, the CEO said, while adding that battery electric trucks don’t work everywhere.
“Colorado, for example, high altitude, cold weather, the range on batteries in cold weather degrades quickly. Our range will degrade a little bit but not anywhere near what a battery truck does,” Girsky said, referring to the company’s hydrogen fuel cell trucks.
“There’s use cases around both. We have customers who want to try ours, want to try everybody else’s, including Tesla’s, and we’ll see where it all lands,” Girsky added.
Nikola initially began delivering battery electric trucks before its hydrogen fuel cell electric trucks. However, following a few fire incidents, the BEV trucks were subsequently recalled in August 2023. The company is now returning the recalled battery electric trucks to customers with improved battery packs and delivering new fuel cell trucks.
“Leading with the fuel cell right now I think makes perfect sense, where it’s less crowded in the marketplace,” company CFO Tom Okray said on Friday.
Why It Matters: For the second quarter, Nikola reported sales of $31.3 million, versus $15.4 million a year ago, beating the analyst consensus estimate of $24.7 million. Adjusted loss per share was $2.67 during the quarter as compared to a loss of $5.90 from a year ago.
Nikola produced 77 trucks in the quarter compared to 33 a year ago and shipped 73 trucks compared to 45 a year ago.
Meanwhile, Tesla’s Semi battery electric truck is on track to start production by the end of 2025.
Tesla CEO Elon Musk has long expressed skepticism over hydrogen as an efficient fuel source.
"Fuel cells should be called fool sells! Such a silly choice for cars. Not great even for a rocket upper stage imo, but at least not absurd," Musk said as long back as March 2021.
In May 2022, Musk said the world would overwhelmingly choose batteries over hydrogen for storing energy and termed the latter “the most dumb thing I could possibly imagine for energy storage.”
Price Action: Nikola shares closed up 8.2% at $8.44 on Friday, according to data from Benzinga Pro. The stock is down by about 66% year-to-date.
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Photo courtesy: Nikola Corporation
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