Nikola Motor Co. finally debuted its Nikola One electric semi-truck Thursday night after months of curiosity and skepticism from the long-haul freight industry.
At the company’s headquarters in an industrial area on the outskirts of Salt Lake City, as suspenseful music throbbed, hundreds of guests watched chief executive Trevor Milton pull the veil off the hydrogen fuel cell big rig parked on stage.
“Oh, that thing is so awesome,” the 35-year-old entrepreneur said, emotionally, once the lights went up.
Guests included Utah Gov. Gary Herbert, Reps. Greg Hughes (R.) and Sue Duckworth (D.) of Utah, government officials from states such as Tennessee and California, employees from Paccar and Navistar and visitors from Norway, Germany, Australia and South America.
Milton teased several other products: a day cab called the Nikola Two, an Uber-esque load-listing system called Nikola Shipments.
But the sleek white Nikola One was the main event.
Milton said truck components company Fitzgerald Glider Kits of Byrdstown, Tenn., will produce the first 5,000 Nikola One truck while Nikola “tests the living heck” out of the vehicles.
Nikola eventually plans to make its own trucks. Milton said the startup will spend the next four to five years building a $1 billion manufacturing and research and development facility, which will support thousands of new jobs. The company is in talks with several state governments about the facility and will determine its location by mid-year 2017, he said.
Eventually, Nikola intends to manufacture 50,000 vehicles each year.
Miami-based fleet management firm Ryder System, Inc., with more than 800 service locations, will be Nikola’s exclusive provider for distribution and maintenance nationwide and in parts of Mexico. In Tennessee and Mississippi, Caterpillar dealer and early Nikola investor Thompson Machinery will supplement Ryder’s sales and services.
“It’s exciting to see a small newcomer with a completely new concept that’s not just pie-in-the-sky,” said Antti Lindstrom, truck market analyst for IHS Markit. “What is impressive to me is that people you talk to in the business seem to look at this company seriously. They’re not laughing — it could be a game-changer.”
Milton explained the specifications of the truck — an electric hydrogen hybrid that operates using a 300kW fuel cell as well as a 320kWh battery bank that provides backup energy and helps the truck with high-torque situations and hill climbing.
The emissions-free vehicle is technically a heavy-duty truck in the Class 8 weight segment, the privately-held company said. The powertrain will produce 1,000 horsepower and generate 2,000 pound-feet of torque. It will travel 800 to 1,200 miles while carrying a full load of 65,000 pounds without stopping at a hydrogen fueling station, Nikola said.
The vehicle’s fuel efficiency is designed to exceed all greenhouse gas mandates from the Environmental Protection Agency and other government departments for the next decade.
Batteries will provide power to the cabin so that drivers won’t need to idle the trucks. Federal and state environmental official are passing increasingly stringent regulations to limit emissions from idling diesel engines.
The truck also features rapid acceleration, a dozen cameras, panoramic views, faster stopping capabilities, unobstructed mid-cab entry and a center of gravity that’s two to three feet lower than average, which improves the truck’s stability.
Nikola One will be road-ready by 2019, the company said. So far, Nikola has received refundable reservations for sales that would be worth some $4 billion. The company is collecting $1,500 per reservation, with the funds sitting in an escrow account untouched.
Customers will be able to lease the truck for between $5,000 to $7,000 a month, with unlimited hydrogen fuel and scheduled maintenance included during a 72-month term.
Milton said the Nikola will be about 10 percent lighter than an equivalent diesel truck. Drivers will be able to use those savings to carry an extra 2,000 pounds, which could be worth up to $1,000 in extra revenue per load.
U.S. Xpress of Chattanooga, Tenn., one of the nation’s largest freight haulers, is one of the first customers.
As the trucking industry works to reduce expenses, the Nikola truck could offer “a distinct value proposition” Marshall Martin, an analyst with the Frost & Sullivan consulting firm. He said the truck’s long range, free maintenance and attractive lease plan could make it less expensive to operate than a comparable diesel-powered truck.
Frost & Sullivan predicted that Nikola will sell 2,300 to 4,800 units by 2025, gaining between 15.7 percent and 32.7 percent of the North American heavy duty electric hybrid truck market. Customers will save $21,127 a year leasing the Nikola One compared to an average Class 8 diesel truck, according to the report.
“Tightening emission and fuel efficiency standards will increasingly push all the major original equipment manufacturers in North America toward an electric-hybrid alternative,” Martin said. “Nikola Motor is expected to pioneer the penetration of electric-hybrid trucks in the heavy-duty, long-haul segment, taking on big players such as Daimler and Volvo.”
Those manufacturers, however, are well entrenched in the truck market and are likely to come up with plans to compete with Nikola, he said.
The Nikola One will only be available in North America. Nikola originally intended for the vehicle to run using turbines fueled by natural gas, but pivoted abruptly to its current hydrogen fuel technology in August to sidestep difficult domestic emissions testing.
Customers who had pre-ordered the natural gas version were shifted to a fuel cell placeholder, the company said. Although orders for 64 trucks were canceled, most customers were excited for the switch and pushed up reservation numbers immediately afterward.
On Thursday night, Nikola also detailed plans for a North American network of hydrogen fueling stations to support the Nikola One trucks. The web of stations —56 are planned initially — will eventually balloon to 364 stations. The first stations will start construction in January 2018 and begin opening in late 2019.
Hydrogen fuel for the stations will come from solar hydrogen farms owned by Nikola, the company said. The farms are each expected to produce more than 100 megawatts of power using electrolysis and will allow the company more pricing flexibility without having to make long-term hedges against diesel, Milton said.
Nikola also exhibited its 107-kilowatt-hour lithium battery pack, which is designed to give its Nikola Zero electric utility task vehicle more than 300 miles of range on a single charge. The company said the 1,000-pound, patent-pending battery can also be inserted into other vehicles starting next year.
Milton showed renderings of a day cab called the Nikola Two, which performs like the sleeper cab but is smaller, more maneuverable and less expensive.
He also described Nikola Shipments – a system incorporated into the trucks featuring listings of open loads uploaded by freight brokers. Drivers can select jobs from the 21-inch screen in the cab and then have the system run calculations based on weather, distance and other factors to determine the most efficient routes.
“This gives power back to the drivers; puts more money into their pocket,” Milton said.
Nikola, named for the Serbian-American inventor Nikola Tesla, was launched several years ago by Milton. He sold his previous company dHybrid Systems, which developed natural gas storage systems for large vehicles, to Worthington Industries in 2014.
He established Nikola around 2012 but officially began production engineering and development in 2014. He said Thursday that his goal “was to literally revolutionize the trucking industry.”
“It takes a big redesign from the ground up,” Milton said. “Most of the time, big companies can’t take those risks.”
Editor’s note: Trevor Milton is 35. An earlier version of this story said he was 34.