Economy & Politics

Why the start-up Nikola on the stock exchange is worth more than Ford

Nikola presented a prototype last yearNikola Motors

The hype surrounding electric mobility has had a name so far: Tesla. Now a second one has been added: Nikola. The start-up has been on the stock exchange since the end of last week – and since then the share price has been going through the roof. At times, the company was worth a whopping $ 34 billion, and now it’s around $ 28 billion.

This is particularly noteworthy because the company has not made any money and has not yet sold a car. The plans for this are extremely ambitious. In this respect, it is also logical that the company is called Nikola. This is the first name of the same famous inventor Nikola Tesla, whose last name had to serve the very successful competitor.

Nikola wants to revolutionize the truck and pick-up market with electric and hydrogen drives. The focus is initially on logistics companies such as Amazon and UPS, who want to reduce the CO2 emissions of their transport fleet.

This year the start-up is targeting zero dollars in revenue. In 2023 it is expected to reach $ 1 billion. So far, the company has only provided several prototypes and non-binding expressions of interest from potential customers. There are plans for a factory and a hydrogen filling station network for the coming years. The goal: battery-powered trucks are to be built for shorter distances as early as next year. The more important hybrid models are to follow in 2023.

The factory in the US state of Arizona – which does not yet exist – should be fully utilized in 2028 and then produce 45,000 vehicles annually. According to the Bloomberg news agency, Nikola has accumulated a loss of approximately $ 188 million since it started about five years ago.

Investors see a lot of potential

Against this background, Nikola is worth more on the stock exchange than Ford, for example. To put it in a nutshell: The almost 120-year-old company expects sales of EUR 115 billion this year. This shows how much investors prefer electric providers to traditional car manufacturers. The share price of Tesla and the Chinese Nio doubled this year despite the Corona crisis, while the prices of companies such as Volkswagen or General Motors collapsed.

One reason for the steep rise in Nikola shares is likely to be the announcement by CEO Trevor Milton that there are plans for an electric pick-up called Badger. Non-binding pre-orders are possible shortly. Pick-ups are the most profitable area in the US auto market.

It may not be certain whether the pick-up is actually being built. The prospectus for the IPO stated that Nikola was concentrating on trucks and that the badger would not be built until Nikola found an “established partner” for it. But Milton now sounded that Nikola would remove the pick-up market leader Ford and his Model 150 from the throne.

So far, according to Nikola, there are around 14,000 non-binding pre-orders worth ten billion dollars. Among them is the Anheuser-Buch brewery, which has reserved 800 hybrid trucks. Management strives to convert some of them into mandatory orders – and then also to receive the first down payments.

The article was first published on ntv.de.

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