Nikola Corporation Reports Second Quarter Results

Nikola Breaks Ground for Greenfield Manufacturing Facility in Coolidge, Arizona

Nikola Corporation (Nasdaq:NKLA), a global leader in zero-emissions transportation systems, today reported financial results for the second quarter of 2020.

“In the second quarter of 2020, Nikola met predetermined milestones on our journey toward becoming the zero-emissions transportation leader in the global heavy truck market,” commented Mark Russell, Nikola’s Chief Executive Officer.  

Steps towards achieving this goal include completing a reverse merger with VectoIQ and a related PIPE offering, providing an additional $616.7 million of cash on the balance sheet to support Nikola’s further product development, and the buildout of manufacturing infrastructure.

Product development is on track to meet the established timeline for the start of production of the Nikola Tre in Q4 2021.  Initial units will be produced at the Ulm, Germany facility, where modifications are currently underway.  Once complete, this facility will be capable of producing up to 10,000 units per year. 

In addition to the buildout of Nikola’s production capacity in Ulm, Germany, on July 23, 2020, Nikola broke ground on its greenfield manufacturing facility in Coolidge, Arizona.  Once completed, the Coolidge manufacturing facility will be capable of producing up to 35,000 trucks per year at full capacity on two shifts. Phase one of this construction is expected to be complete by Q4 2021.

Other Key Business Highlights

• Signed a purchase order with Nel for electrolysis equipment capable of producing up to 40,000kg of H2 per day.
• Nikola Tre production test units are underway in Ulm, Germany and are scheduled to be complete in Q4 2020.
• Nikola called for redemption of outstanding public warrants in Q3 2020.

Purchase Order for Electrolysis Equipment from Nel

In June, Nikola signed a purchase order with Nel ASA (Nel, OSE: NEL) for 85-megawatts of alkaline electrolyzer capacity. This purchase order will support up to five of Nikola’s hydrogen generating and dispensing stations. At capacity, these stations are expected to generate up to 40,000 kgs of hydrogen fuel each day, which would support up to 1,100 Nikola Two FCEV trucks.

Nikola’s hydrogen fueling and battery charging activities are being overseen by the newly-hired President of Nikola Energy, Pablo Koziner. Koziner is a 19-year veteran of Caterpillar, and most recently served as Vice President of CAT Electric Power and as President of Solar Turbines.

Nikola’s Ulm, Germany Manufacturing Facility

During the second quarter, Nikola and Iveco began the buildout of an assembly facility dedicated to Nikola Tre at CNHI / Iveco’s Ulm, Germany Manufacturing Complex. Once completed, this facility will be capable of producing up to 10,000 trucks per year, and will produce the first Nikola Tre BEV trucks to be delivered to customers in the U.S.

Upon completion of Nikola’s greenfield manufacturing facility in Coolidge, Arizona, the Ulm facility will be utilized to manufacture and supply trucks to the European market.

Coolidge Manufacturing Facility

On July 23, Nikola broke ground on phase one of the U.S. manufacturing facility in Coolidge, Arizona. Nikola anticipates phase one of the manufacturing facility will be complete by Q4 2021. Nikola is working with Walbridge, the leading U.S. automotive facility construction organization.

Nikola’s manufacturing facilities buildout is being overseen by Mark Duchesne, Nikola’s newly hired Head of Global Manufacturing. Duchesne is a 5-year veteran of Tesla and a 22-year veteran of Toyota. Mark oversaw the design and development of the innovative Model S and Model X production lines at Tesla, and at Toyota, he was instrumental in the design and development of a $900M greenfield facility.

Nikola Calls for Redemption of Warrants

On July 22, Nikola issued a notice of redemption for its public warrants. By calling the public warrants for redemption, Nikola expects to raise an additional $264.5 million in cash through the exercise of the 23 million outstanding public warrants at an exercise price of $11.50. As of July 30, 2020, 18.1 million warrants (approximately 79% of all outstanding public warrants) had been exercised, providing Nikola with an additional $208 million of cash on the balance sheet to date.

Nikola intends to begin fleet testing Tre BEV units in 2021 with select customers and partners. The data received from the fleet testing program will be critical as we move toward low volume production of the Nikola Tre BEV.  Management is optimistic as we continue to achieve milestones toward our greater goal of becoming the leader in the zero-emissions transportation industry.

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