Since completing the reverse merger in March, the stock is up more than 100%. The company already has a valuation of over $5 billion, and it's competing against established companies like Toyota
Like Tesla, Nikola Motors' challenge will be to produce these trucks at scale, while maintaining quality. It's also going to have to build fueling stations across the country and eventually the world in the same way that Tesla has done. Many are speculating that Nikola is following Tesla's path and eventually will bring all types of vehicles to the market. Tesla started off building high-end sports cars to win customers at first to establish a beachhead in the industry and attract investor capital before building cars for a larger market.
Trevor Milton, Founder
The company was started by Trevor Milton who remains its CEO. His first two startups, Upillar, and dHybrid were failures. The business model for dHybrid was to modify diesel engines, so they could run on diesel and natural gas, which would be cheaper and more energy-efficient. This experience sparked the idea for Nikola Motors to become the first zero-emissions truck.
Like Tesla, Nikola Motors' early team was made up of brilliant engineers who had no automotive experience. This was because as a start-up, they didn't have the means to attract top-flight talent from companies with deep pockets, and also, these engineers weren't limited by industry constraints or conventional thinking. Another similarity to Tesla is neither company spends money on marketing rather focusing on building the best product.
Nikola Motors' trucks are cheaper to fuel due to its use of hydrogen fuel than diesel-powered and electric hybrid trucks. The company's trucks are also as strong as its competitors while weighing less. However, its limiting factor is that the trucks can only travel as far as its fueling stations.
Of course, its stock is a major asset in this endeavor. If investors believe in its story and likelihood of success, its stock will be bid up which will give it more resources. The company's strong number of preorders following product demos to trucking companies is a strong vote of confidence that its trucks could be a game-changer.
Additionally, the current market environment is very favorable to these types of companies. Virgin Space