(Phoenix / USA) – The US vehicle manufacturer Nikola Corporation wants to change its market strategy for North America. “We have reprioritized the business,” said the company on the occasion of the publication of the financial report for the first three months of this year.

As a result, sales increased to $2023 million (11,1 million euros) in the first quarter of 10,2 compared to $1,8 million in the first quarter of the previous year. But the net loss also increased: to around 169 million dollars (155 million euros) compared to almost 153 million dollars in the comparable period. After the figures were announced, Nikola shares on the Nasdaq technology exchange fell by almost 19 percent last week (week 13), from $0,98 to $0,86, and then further to their lowest level to date of $0,71 Dollar to crash. The share's previous high was on June 19, 2020, at $65,90.

Share in the European joint venture sold

In the future, the company wants to “concentrate on the areas in which we have competitive and first-mover advantages,” says managing director Michael Lohscheller. The 50 percent share in the European joint venture will be sold to the Italian truck manufacturer Iveco Group NV.

The two companies had that joint Venture Founded in 2019 to produce the “Tre FCEV” truck model at the Iveco factory in Ulm. The sale of the stake will bring Nikola $35 million in cash, and Iveco will also return 20,6 million Nikola common shares. Iveco will remain a key supplier and significant shareholder in the future and will concentrate on the European market.

Strengthening in the US market

In contrast, the North American market is lucrative for Nikola, the company explains. The USA has created good positions for manufacturers of heavy commercial vehicles with the Inflation Reduction Act and strong incentive programs for zero-emission trucks and infrastructure in states such as California, New York, New Jersey, Colorado and Washington.

Additionally, many states have implemented strict regulations. In California, for example, from January 2024 only zero-emission transport vehicles will be allowed to be re-registered with the California Air Resources Board (CARB). The authority was founded in 1967 by then California Governor Ronald Reagan and is tasked with getting air pollution under control. In the next step, all transport vehicles in California that travel to seaports and loading stations must be emission-free by 2035.

Focus on gas stations and FCEVs

Nikola therefore wants to concentrate on the North American market with fuel cell trucks (FCEV), on the hydrogen filling station system called “Hyla” as well as on vehicle control technologies and software. At the beginning of May, the company agreed with the operator of filling stations and charging stations Voltera Power to have up to 50 in the next five years Hyla stations for the US market.

And the Australian company Fortescue Future Industries (FFI), owned by mining magnate Andrew Forrest, wants to develop “large-scale” plants for the production of green hydrogen across North America.

Assembly of BEV is interrupted

Demand for battery-operated trucks (BEVs) is currently rather “sluggish”. Nikola built 63 units in the first quarter, but only delivered 31 to dealers. The rest remains available.

“Since we have sufficient inventory of battery-electric trucks,” production in Coolidge (near Phoenix, Arizona) will be “temporarily interrupted” at the end of May. The assembly line will be modified so that both BEVs and FCEVs can be manufactured. After the conversion, BEVs would initially only be built when orders were received.

More orders for FCEV trucks

Nikola reports a number of incoming orders for the fuel cell truck segment. At the beginning of May there was an order for up to 50 Tre FCEVs from the freight forwarder AJR Trucking, which also works for the US government.

Nikola's hydrogen trucks Nikola Two, Nikola Tre and Nikola One. © Nikola Motor Company

In addition, the first two of ten “Gamma” fuel cell vehicles have been completed. The remaining eight would be produced by the end of June. All models will be used for pilot projects with customers such as the retail groups Biagi Bros and Walmart, as well as with the industrial gas manufacturer Linde and AJR Trucking. This is also accompanied by technical optimization.

“To date, we have received orders for 140 fuel cell trucks from twelve customers,” it said in a statement. They are “on track to begin series production at the Coolidge factory in July.”

Future of Romeo Power uncertain

The manufacturer is also considering restructuring the business of battery manufacturer Romeo Power, which it took over less than a year ago. Nikola bought Romeo for $144 million. At the time, it was said that the company wanted to strengthen its battery supply chain. Although FCEVs also need buffer batteries, it is now questionable whether they would have to come from our own production given the financial situation. There is talk of selling these assets – or even filing for bankruptcy.

Screenshot: Nikola boss Michael Lohscheller woos shareholders in a 4-minute video message. The annual general meeting is scheduled for June 7th. © Nikola Corp.

“By focusing on what we do best, Nikola has a first-mover advantage and can capture a significant share of the commercial truck market while building a hydrogen energy business that can grow over the long term,” he said the company.

The day after the publication of the quarterly figures, managing director Lohscheller was already advertising one Video to obtain investor consent to increase the number of Nikola common shares. The general meeting will take place on June 7th.

Photos
Nikola headquarters in Phoenix, Arizona: The company wants to better position itself in the North American market. © Nikola Corp.