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Nikola’s $12 Billion Nasdaq Debut Is A Boost For Hydrogen Trucks–And Founder Trevor Milton’s Fortune


It’s going to take a few years to know if Nikola Motor’s plan to clean up trucking with zero-emission semis powered by hydrogen works, but the Arizona startup’s Nasdaq

NDAQ
debut is a high-profile bet that the elemental fuel can finally crack the transportation market. It also turned company founder Trevor Milton into a multibillionaire. 

Shares of Phoenix-based Nikola ended at $33.75, down less than 1% after earlier rising as much as 5%. That put the company’s market cap at about $12 billion, based on approximately 360 million shares outstanding. Milton is the biggest shareholder, with a stake worth about $3.7 billion at the close on Thursday, according to a Forbes estimate–more three times an initial calculation in 2019. 

Interest in the company has been rising in recent months, and not just from investors ahead of the Nasdaq listing, Milton says. “We’re now talking with almost every major OEM in the world,” he tells Forbes. In part, that’s due to the addition of Steve Girsky, a former vice chairman of General Motors

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, to Nikola’s board. (Rather than an IPO, Nikola’s speedy Nasdaq listing resulted from its reverse merger with Girsky’s publicly traded VectoIQ that was completed on June 2.)

“It’s interesting, the groups that have been more open to working with us are ones you’d probably not expect,” he said, hinting that announcements may be coming in the weeks ahead. Currently, Nikola is partnered with European commercial vehicle maker CNH / Iveco to build battery-electric versions of its trucks for that market starting in 2021. It’s also working with Bosch, Meritor and several other manufacturers specializing in the commercial vehicle space. 

Nikola has secured truck orders worth $10 billion from companies led by Anheuser-Busch, which wants 800 of the company’s non-polluting behemoths. So far, Nikola hasn’t generated much revenue but estimates sales will jump from $150 million in 2021 to $3.2 billion by 2024 as it ramps up productions. In 2024, it expects to sell or lease 7,000 battery-powered units and 5,000 hydrogen fuel cell trucks, according to its filing.

While the company has yet to deliver trucks to commercial customers, there’s been a steady uptick in interest in hydrogen for heavy-duty trucks, particularly long-haul vehicles, as fuel cell power systems are much lighter than batteries and can be refueled about as fast as diesel and gasoline models. Along with Iveco, Bosch and Meritor, Nikola also counts South Korean solar panel maker Hanwha and Norway’s Nel as key industrial partners that helping get it sci-fi-styled semis on the road and fueled up.

 (For more on Nikola and Trevor Milton, see Behind New Billionaire Trevor Milton’s $3 Billion Push To Make America Run On Hydrogen from the September 30, 2019 issue of Forbes magazine.)

Like Elon Musk’s Tesla

TSLA
, Nikola plans to build and operate fuel stations to support its vehicles. This week it announced plans to buy $30 million of equipment from Nel to help it produce 40,000 kilograms of hydrogen a day from water and renewable electricity. “These electrolyzers will support five heavy duty hydrogen stations which will cover multiple states and trucking routes,” Milton said in a statement. He declined to tell Forbes where those first stations will be built, though undoubtedly some will be in California, which has incentives for non-polluting trucks to help curb carbon emissions.

Fuel cell technology, which makes electricity in a chemical reaction involving hydrogen and oxygen with only water vapor as a byproduct, has been around since the 1960s, but earlier iterations were far too costly and not durable enough for heavy daily use. That’s changed dramatically in the past decade, with costs for the materials and fuel tanks dropping steadily as the technology matured. While industrial hydrogen is typically sourced from natural gas, new methods for generating “green” hydrogen from water and electricity from solar or wind farms have made the fuel much more compelling to environmental regulators in California, Europe, Japan, South Korea and China.

And while Nikola’s hydrogen truck and fuel plans are the most ambitious, it faces competition in the space from big players including Hyundai Motor and Toyota Motor Corp. Toyota has been testing hydrogen fuel cell trucks at the Port of Los Angeles for years and Hyundai this week opened South Korea’s first hydrogen fuel station for commercial vehicles.

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