The Superficial Allure of Nikola’s Clean Tech

Further due diligence is warranted

Their vehicles are attractive, the product offerings have grown in number, the “reservations” are in, the enthusiasm is palpable, the novelty factor is there, and they promise to deliver the clean wave of the heavy trucking future with high tech. Nikola is a hit. And, it’s still all on paper.

Analysis upon analysis of the Nikola story tends to focus on the financial feasibility of launching a vertically-integrated hydrogen fuel company such as the one it is marketing itself to be some day, from stations that produce and deliver the hydrogen fuel, to vehicle sales and maintenance sites, to the heavy trucks themselves. “This is the unlevered IRR of infrastructure capex; this is how many billions in sales interest have been generated; these are the details of the total cost of ownership leases; these are the target costs of the critical inputs of electricity and water in order to produce affordable hydrogen fuel in the first place.”

Beyond the economics of it all, there are other real concerns to be examined. Namely, how cleanly can Nikola actually “decarbonize” the trucking industry in the United States?

As a recent piece by Barron’s points out, hydrogen fuel currently costs $16 per unit. Founder Trevor Milton hopes to bring this down…