Controversy-entrenched Nikola (NASDAQ:NKLA) made a confidence-inspiring delivery today that has investors talking. The company delivered the first of 100 planned Tre battery-electric vehicle (BEV) pilot trucks to Total Transportation Services today. Expectedly, NKLA stock reacted positively to the news. Shares closed up 7.1%.
So what do you need to know about the highly publicized delivery?
Despite Nikola’s checkered past, things are looking up for the company as the delivery cements its timeline. In May, Nikola announced a letter of intent from TTS, a prominent California port trucking company. The letter puts Nikola on the hook for 100 zero-emission trucks within the next two to three years.
This latest delivery marks the start of the four-truck pilot program that kicks off the agreement. As CEO Mark Russell said:
“Nikola committed to make its first Tre BEV deliveries in Q4 2021 and it is a big honor to celebrate this milestone with our partner, TTSI, and dignitaries who are committed to advancing zero-emission transportation solutions to reduce truck emissions in port operations. TTSI has significant sustainability goals, and we are pleased to help them achieve their vision with our zero-emission trucks.”
Is Today’s NKLA Stock Jump a Sign of Things to Come?
This latest BEV truck delivery is one of two EV trucks Nikola has developed, alongside the longer-range fuel cell EV (FCEV) truck. Interestingly, FCEVs actually make up the majority of Nikola’s LOI, with 70 promised compared to 30 BEVs. Should the pilot program go well, it could be a sign of a major reversal for the company.
Today’s delivery was very well attended. More than 10 California representatives showed up to support the zero-emission message. This list included Congresswoman Nanette Diaz Barragán, who had some kind words for the delivery:
“This is crucial for the health of people living in the communities near the ports in my district, who suffer higher rates of cancer, asthma and other respiratory diseases due to all the toxic diesel emissions coming from the equipment and trucks at the ports. I appreciate the commitment TTSI and Nikola have made at the Port of Los Angeles to a cleaner, safer future.”
This latest piece of news is inarguably a breath of fresh air for Nikola. Although the company captivated investors with its fuel cell and battery electric vehicle promises, it has also captured headlines for drama. Perhaps most notable is news of the arrest of founder Trevor Milton this summer.
Officials allege that Milton made a series of false claims about the status of its developmental trucks, earning more than $500 million in investments in the process.
With someone else filling Milton’s role, today’s delivery really could be the start of a new era for the company.
On the date of publication, Shrey Dua did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
