Just months after Republic Services announced it signed a binding agreement on Aug. 10 to purchase 2,500 electric refuse vehicles from Phoenix-based electric vehicle maker Nikola Corp., Nikola Corp. issued a release Dec. 23 announcing the partnership was off.
“After considerable collaboration and review, both companies determined that the combination of the various new technologies and design concepts would result in longer than expected development time, and unexpected costs. As a result, the program is being terminated resulting in the cancellation of the previously announced vehicle order,” Nikola stated in a press release.
“This was the right decision for both companies given the resources and investments required,” Nikola CEO Mark Russell said via the release. “We support and respect Republic Services’ commitment to achieving environmentally responsible, sustainable solutions for their customers. Nikola remains laser-focused on delivering on our battery-electric and fuel-cell electric commercial truck programs, and the energy infrastructure to support them.”
The announcement of the canceled deal comes on the heels of months of turbulence for the vehicle manufacturer and its founder, Trevor Milton. On Sept. 10, short-seller Hindenburg Research, which dubs itself a financial research firm, published a scathing report on the manufacturer titled, “Nikola: How to Parlay an Ocean of Lies Into a Partnership With the Largest Auto OEM in America.” In the report, the research firm claims Milton misled partners by falsely claiming to have proprietary technology and for engaging in numerous acts of deception related to the capabilities of the company’s electric vehicles.
“We have never seen this level of deception at a public company, especially of this size,” the authors of the report write.
A week after the Hindenburg report was published, Milton resigned as executive chairman and board member of the company. In November, Nikola announced the company and Milton had received grand jury subpoenas from the Department of Justice, and that the company had received a grand jury subpoena from the New York County District Attorney’s Office based on the Hindenburg report.
Republic initially announced the agreement to purchase 2,500 electric waste and recycling collection trucks from Nikola with estimated delivery dates starting in 2023. The deal was expandable to 5,000 vehicles over the life of the agreement. (Read the details of the agreement in the Sept. issue of Waste Today).
At the time, Republic noted that the deal marked “the industry’s first large-scale commitment to fleet electrification.” The parties didn’t share the total cost of the investment, but Milton ballparked Republic’s total investment between $1 billion to $2 billion.
Milton noted how the electric waste vehicles would feature 2,000 horsepower (as opposed to the 350 to 500 horsepower that today’s diesel vehicles typically boast), would have zero emissions and be noticeably quieter than diesel or natural gas alternatives.
Milton also said the company was working in collaboration with Republic to help design the vehicles for specific use in the waste industry.
Republic Services President Jon Vander Ark said that Republic had been looking at investing in electric vehicles for several years and had compared all vendors in the space before selecting Nikola a little more than a year ago for this significant commitment.
In a statement following the termination of the Nikola deal, Republic stated that, “We continue to believe that electrification is the future.” The company cited ongoing partnerships with Mack and Peterbilt, and its recently reported investment in California battery startup Romeo Systems, as evidence of its desire to continue pursuit of electric vehicle technology for use in waste applications.