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Tesla Motors Inc (TSLA) Meets Nikola Motor – The Tesla of Trucks

Tesla Motors of Trucks TSLA

Tesla Motors plans to get into the trucking business sometime in the future but another Nikola Tesla fan seems to have beaten Tesla to the punch. Tesla is named after Nikola Tesla, a Serbian-American electrical engineer, inventor, and futurist. The Tesla brand is already synonymous with electric cars but a startup thinks Elon Musk shouldn’t have the monopoly of using Nikola Tesla’s name in building electric vehicles.

Tesla Motors of Trucks TSLA

You might not have heard about Nikola Motor yet, the firm is an EV startup that might become the Tesla Motors of the trucking industry. Nikola Motor is not trying to compete with Elon Musk in building electric cars; rather, it wants to build electric trucks. Mind you, it is not planning to build the kind of electric pickup trucks that Elon Musk hopes to build in the next couple of years; Nikola Motor wants to build heavy-duty electric-powered trucks.

The Tesla of Trucks hits the ground running

In May, Nikola Motor revealed that it will launch an electric class 8 semi-truck, dubbed “Nikola One.” Nikola One will be priced at $375,000 and truckers can lease the truck for $4000 to $5000 per month. The unveiling of Nikola One has been planned for a December 2 event but it seems that players in the trucking industry are eager to lay their hands on electric trucks.

Nikola Motor’s CEO Trevor Milton is copying moves from Tesla Motors playbook to ensure success for his firm. In a press release published on Monday, he revealed that Nikola Motor has generated $2.3B in pre-sales in its first month. In case you are wondering how on earth a relatively unknown EV firm could make $2.3B in presales. He revealed that Nikola Motor received more than 7000 reservations backed by a refundable deposit of $1,500.

Milton noted that “our technology is 10-15 years ahead of any other OEM in fuel efficiencies, MPG and emissions. We are the only OEM to have a near zero emission truck and still outperform diesel trucks running at 80,000 pounds. To have over 7,000 reservations totaling more than 2.3 billion dollars, with five months remaining until our unveiling ceremony, is unprecedented.”

What is different about Nikolas Motor?

Naturally, Nikola Motor wouldn’t have gotten any attention because the success of Tesla Motors has attracted many wannabe startups into the EV business. Faraday Future is trying to get a foothold in the industry, EV Luca is trying to raise funds via crowdfunding, and there are possibly hundred of EV firms in china trying to come with cheap variants of electric vehicles.

However, Nikola Motor is not starting out with the goal of building fully electric trucks. Its first truck is an electric-diesel hybrid. The Nikola One has a fuel turbine that feeds a 320kWh battery pack. The firm expects its Nikola One truck to travel 1,200 miles with a full tank of gas feeding its electric power train.

The firm is also creating an adaptation of Tesla’s free supercharger network. Nikola Motor says the first million mile of fuel comes as a bonus with every new truck it sells. In essence, Nikola seeks to offer buyers an irresistible cost-benefit ratio because its costs cost $375,000 while “average diesel truck burns over $400,000 in fuel and racks up over $100,000 in maintenance costs over 1,000,000 miles”.

Will Nikola be able to recreate Tesla’s success with electric trucks? Only time will tell, but in the meantime, Elon Musk should start thinking about putting some money in the next Tesla – or Nikola.

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Victor Alagbe is a seasoned business and finance writer with a specialty in writing about how to invest for the long-term in healthcare, pharmacology, energy and tech stocks. His long-term focus is on stocks that provide a nice mix of growth and income. For the short term, he passionately writes about trading stock options for the excitement and leverage that stock options offer.

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