Nikola Stock Makes Huge Jump Prompting Comments From Elon Musk

Matty-Sways

The battle between hydrogen and battery cells has begun between Tesla and Nikola, both companies named for same person.

Nikola Motor Company has faced recent market value attention in the past few weeks with their focus on hard-working vehicles like pick-up trucks and lorries, according to a report by The Irish Times.

Nikola founder and executive chairman Trevor Milton says that trucks are the company’s best avenue.

“We’re not getting into cars, cars is a money-losing market and that’s why you see our competitors coming into semi-trucks now, because they have a hard time making money. There is no money in car making, even the biggest groups in the world lose money on it. It’s a 50-50 shot to make money,” says Milton.

Milton explained that the company has also focused on large semi-trucks because the transportation industry is the second-largest polluter in the world, and they want to help lower emissions.

“You cannot be environmentally sustainable if you’re not financially sustainable. That’s the most important phrase I can ever tell people, and that’s why it’s so important to be in a market where you can actually make money, and you don’t need government subsidies to keep you alive,” Milton said.

That said, Nikola has yet to make a single production vehicle. They have recently begun production of their first lorries, partnering with CNH Industrial, but Milton confirmed that Nikola’s first profit is a few years away. Investors see potential in the company, though, which is why the market value has started to reach unseen heights for the company. Nikola’s Nasdaq exchange listing was worth $30 billion according to investors, which is more than the listing for both Ford and Fiat.

“What they don’t understand is that for my generation, and for the world right now, revenue is not everything. It’s about solving complex problems, and if you can solve complex problems, the revenue will come,” Milton said about those that criticized Nikola’s valuation reaching higher than Ford or Fiat’s.

Nikola has also been criticized by Elon Musk, the CEO of Tesla. Both companies were branded after Nikola Tesla, a Serbian-born scientist. Musk’s Tesla focuses on battery power for its vehicles while Milton’s Nikola focuses on hydrogen power. Toyota and Hyundai have insisted that hydrogen power is better, but the question still remains unanswered. Hydrogen power requires much investment in infrastructure unlike electric power, which only needs plugs and charging stations, but hydrogen power is easier for the user.

In a study called Automotive Industry 2035, the results showed that while a battery powered car is about 70-80 percent power-efficient, a hydrogen powered car is only about 25-35 percent efficient. A hydrogen car, then, consumes two to three times more electricity than a battery car. However, since Milton’s company is developing hard-working trucks and not cars, he insists that hydrogen power makes more sense for refueling and weight. The debate between the two types of power is expected to remain a significant issue in the car-making field.

“You know, Elon doesn’t like us that much. He calls the fuel cell the ‘fool cell’. And that’s okay; I just kind of laugh, because you don’t use batteries to send rockets to space. So, one size does not fit all,” Milton explained.

In the wake of Nikola’s recent market success, Musk has begun tweeting about putting his own company’s HGV into production.

Read the full report here.

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