Why Nikola Stock Dropped Today

What happened

The market is going against speculative clean energy stocks today. Shares in battery-electric and hydrogen fuel cell vehicle maker Nikola (NKLA +0.00%) are trading down with the group. As of 1:40 p.m. EST, shares in Nikola were down 7%. 

The move in the sector comes on the same day the company released details for its North American fuel cell electric vehicle (FCEV) program. 

So what

Today, Nikola released an announcement detailing plans for its FCEV commercial truck program. The company plans to initiate production at its Arizona facility with the battery-electric Tre semi truck. Following that launch, plans call for an FCEV version of the Tre, as well as the long-range Nikola Two FCEV Sleeper for the North American market of driving ranges between 300 and 900 miles.

Nikola Two FCEV Sleeper. Image source: Nikola.

Now what

Nikola plans to break its FCEV heavy-truck offerings into three categories. Metro/regional vehicles for trips less than 300 miles, regional for fast fueling or quick turnaround trips up to 500 miles, and a long-haul Nikola Two sleeper designed for up to 900-mile ranges.

Nikola plans to begin production of its FCEV Tre in 2023, after prototypes are built in the second quarter of 2021 and testing and validation is completed through 2022. The company says the trucks will leverage the battery-electric Tre platform "with hydrogen fuel-cell power, while being designed to improve aerodynamics and reduce total vehicle weight." Production of the long-haul Two is scheduled to begin in 2024. 

The company added that both the FCEV Two and Tre "are expected to utilize multiple common fuel-cell power modules and scalable hydrogen storage systems." Investors aren't putting much stock in today's update as market sentiment goes against the sector. But the update is worth filing away to see if the company matches its timeline.