The ambitious electric vehicle manufacturer Nikola Motors has lost its second major contract in two months. Republic Services refused to buy 2,500 electric garbage trucks from Nikola. Former partners attributed the refusal to the high costs of developing new technologies and design concepts. However, analysts link the Republic’s decision to the Hindenburg Research exposure published in September this year.
“After significant joint efforts, the two companies have determined that the combination of various new technologies and design concepts will result in longer than expected development times and unexpected costs. As a result, the program is closed, which leads to the cancellation of the previously announced order for cars, ”the press service of Nikola Motors said.
As noted by Electrek, Nikola and Republic Services’ decision looks ambiguous. Other automakers have been successfully developing and marketing their electric garbage trucks for several years. China’s BYD commissioned a similar truck four years ago, while Volvo and Tesla showed off their models in 2018 and 2019. Daimler has recently joined the development of electric garbage trucks with the electric eEconic – parent company Mercedes will start mass production of the car in the first half of 2021.
At the same time, Republic Services is Nikola’s second problem in the last 30 days. Late last month, General Motors canceled its agreement to build the Badger hydrogen pickup truck, although it retained its decision to supply hydrogen fuel cell technology. Nikola representatives did not explain why GM abandoned Badger and returned the funds received from pre-orders to customers.
In September of this year, employees of the Hindenburg Research agency called the head of the company Trevor Milton a fraud and caught Nikola Motors of repeatedly deceiving potential customers and investors, including NASA. Based on phone calls, text messages, and internal emails, Hindenburg Research found that the 2019 Nikola One ad was a fake – an electric tractor was a “blank” that was running down a hill without an engine. Moreover, Nikola’s hydrogen engines and breakthrough batteries – at the time of the announcement – existed only on paper, and company representatives could not show real specifications or working prototypes of their technologies.
The Hindenburg Research investigation successfully complemented earlier accusations from Bloomberg journalists who were also skeptical of Nikola for several years. Trevor Milton, founder and CEO of Nikola Motors, was unable to refute the allegations, confirmed the electric truck fraud and left the company a few weeks later. Nikola shares have dropped another 11% in recent days and settled at $ 15.36 per share, although in June their value reached $ 80.
The production of Nikola Motors’ flagship product – the Badger electric truck, which Milton called the “Tesla Cybertruck killer” – is now in question, and the company no longer mentions Nikola One trucks in its marketing materials.