Nikola and Republic Services drop their electric garbage truck

But Nikola’s stock price plummeted 10% on Wednesday morning, after the deal was publicly canceled. Wedbush analysts gave Nikola a “poor performance” rating in response to the announcement, which the company said was a “punch in the stomach” for investors who were counting on the Republic Services deal as a watershed for the company. troubled startup.

“Given the wave of bad news for Nikola in recent months, that was not the news that investors wanted to see under his Christmas tree,” wrote Dan Ives, an analyst at Wedbush, in a note to investors on Wednesday morning. “The company still has a steep climb like Kilimanjaro to regain Street’s credibility towards 2021, with today’s news seen as yet another setback,” added the company.

Nikola said the two companies agreed to cancel the deal after determining that the combination of new technologies and design concepts to make electric trucks would take more time and cost more than originally planned.

“This was the right decision for both companies, given the necessary resources and investments,” said Nikola’s CEO Mark Russell in a written statement.

Republic Services confirmed by email that its deal with Nikola has been “terminated”, noting that it continues its electric vehicle partnerships with truck manufacturers Mack, Peterbilt and California battery startup Romeo Systems, in addition to making more purchases of vehicles next year.

“We continue to believe that electrification is the future, said the waste management company.” We believe that the opportunity to learn and partner with Romeo will continue to provide additional opportunities that support our electrification strategy. “

In September, Nikola’s founder Trevor Milton was accused of fraud by financial research firm Hindenberg Research for allegedly exaggerating the capabilities of the Nikola One hydrogen fuel cell electric semi-truck, although CNN has not independently verified the claims made in the Hindenburg report. Milton resigned from his positions as executive chairman of the company and one of its board members after the scandal.

The Securities and Exchange Commission and the Department of Justice summoned Milton and Nikola on November 9. The company’s shares plunged 20% at the end of November, after General Motors (GM) overturned his plans to manufacture Nikola’s Badger truck.

Wall Street has been optimistic about electric car makers for much of 2020, despite setbacks for some of the major companies that make the vehicles, as transportation companies work to better meet government emissions standards.

Nikola also said on Wednesday that deliveries to the United States of its Tre battery electric semi-trucks will begin in 2021. The company plans to launch its first commercial hydrogen station next year. Production of its hydrogen fuel cell electric semi-trucks is scheduled to begin in 2023.

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