Management at electric truck start-up Nikola (NKLA -1.99%) has been working over the past year to recoup some of the investor trust it lost after company founder Trevor Milton was forced to resign as chairman and was subsequently charged with investor fraud. Current management took a big step in that direction Friday when it confirmed that it had delivered its first battery-electric vehicles to a customer. While the tech-heavy Nasdaq index ended the day virtually flat, Nikola outperformed, ending the session up by 7.1% after having been up by more than 10% earlier.
Earlier in 2021, the company told investors it would begin shipping its battery-electric semi trucks before the end of the year. Friday, the company announced it had made good on that prediction.
It has sent its first Tre semi trucks to California-based logistics provider Total Transportation Services (TTSI). The port drayage company will conduct a pilot test of two Tre trucks, as well as a pair of Nikola's hydrogen-fuel-cell-electric vehicles, at its Los Angeles and Long Beach port operations. Assuming the test goes well (and the company receives "certain government funding"), TTSI intends to purchase 100 trucks from Nikola. The letter of intent calls for 30 Tre battery-electric trucks to be delivered in 2022, and 70 fuel-cell-electric vehicles that would likely be delivered beginning in 2023.
Nikola's Tre is intended to be used for local deliveries of up to 350 miles, while its fuel-cell-electric trucks are expected to be utilized for trips of up to 500 miles. The port services company has set a goal of achieving a fully zero-emission fleet.
Friday's news about Nikola's initial vehicle delivery was a good first step in terms of restoring some credibility to management, and investors seemed to notice.