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CNH Industrial to take $250M strategic stake in Nikola; partnership on fuel-cell and battery-electric heavy-duty trucks

CNH Industrial N.V., the owner of IVECO and FPT Industrial, intends to enter into a strategic and exclusive heavy-duty truck partnership with Nikola Corporation to accelerate industry transformation towards emission neutrality of Class 8 heavy-duty trucks in North America and Europe through the adoption of fuel-cell technology.

Nikola’s zero-emission Heavy Duty Trucks, powered by proprietary hydrogen fuel cell and battery technology, will be the first-to-production. The company’s business model foresees an industry-first all-in lease rate, which includes vehicle, service, maintenance and fuel costs, providing long-term total cost of ownership certainty at or below diesel costs.

CNH Industrial will take a $250-million strategic stake in Nikola as the lead Series D investor, comprising $100 million cash and $150 million in services, such as product development, manufacturing engineering, and other technical assistance, as well as supply of certain key components to accelerate the production timeline of the Nikola TWO and Nikola TRE.

Pre-money valuation was set at $3 billion. Nikola anticipates raising more than $1 billion in the D round, granting approximately 25% ownership to new investors and business partners, including CNH Industrial.

IVECO and FPT Industrial, the commercial vehicle and powertrain brands of CNH Industrial respectively, will assist in engineering and manufacturing expertise to industrialize Nikola’s fuel-cell and battery electric trucks.

The following vehicles will benefit from this partnership: the Nikola ONE, a NAFTA- compliant Class 8 sleeper truck; the Nikola TWO, a NAFTA-compliant Class 8 day-cab truck; and the Nikola TRE, a European compliant cab-over Heavy-Duty Truck.

Nikola will contribute technologies for a European Joint Venture with CNH Industrial that will include fuel-cell expertise, e-axles, inverters, independent suspension, on-board hydrogen fuel storage, over-the-air software update functionality, infotainment, vehicle controls, vehicle-to-station communication protocols, power electronics, and access to a hydrogen fueling network.

FPT Industrial has been at the forefront of alternative propulsion solutions for over two decades, having produced some 50,000 natural gas-powered engines to date. IVECO is the European leader in natural gas vehicles, with some 28,000 of its trucks and buses powered by FPT Industrial engines.

FPT Industrial and IVECO have been instrumental in the development and expansion of Europe’s natural gas refueling network, in addition to successfully introducing new powertrain technology. Following a similar path, Nikola is actively working with partners to develop the required hydrogen refueling infrastructure in North America and Europe.

Strategic near-term project milestones include the industrialization of the Nikola TWO fuel-cell-powered Class 8 truck for the North American market, as well as the integration of IVECO S-Way truck technology into the battery-electric powered Nikola TRE cab-over model for both the North American and European markets.

In the long-term, a European Joint Venture will cover both battery electric vehicles (BEV) and fuel-cell electric vehicles (FCEV) launched by Q4 2022. Nikola plans to leverage IVECO’s European sales, service and warranty channels to accelerate access to the European market.

Comments

Davemart

That is some serious financial and industrial muscle getting behind Nikola.
Each of their fuelling stations is to also offer fuelliing for FCEV cars, so coast to coast travel may be available for them much sooner than might have been otherwise expected.

HarveyD

Leasing adapted Class 8 FC trucks with services and fuel to users in EU and USA for same or less than equivalent diesel units is a smart idea to gain a large user base. Wish Nikola well!

SJC

Partners at this stage are key.

Arnold

It makes sense to pair (decent sized ) battery with fuel cells to heavy vehicles.
The battery mantra people rightly worry that hydrogen production from renewables is not mature an may divert funding away from battery and R.E. But history tells us that invention isn't serial.
I think it was feminists who first coined the idea of walking and chewing gum at the same time ( clever ). Hard to understand the vertical thinkers that can't get the way things work in an interleaved reality.
I wish this work well and expect it will encourage partners supplying green hydrogen.
There will always be wreckers and obstructionism to any achievement but they eventually become best known for not having constructive criticism or workable ideas.

Nirmalkumar

This idea of offering total operation package at less then diesel operating cost is great.
It should be encouraged by govts to do away from heavy killer petroleum pollution.

SJC

Putting the package together helps customers compare costs.

sd

I wish Nocola well but I would be hard pressed to evaluate the company at $3B. Nicola was moving out of a building in SLC, UT at the same time that my company was moving into a larger section of the same building. Nicola had received either funding or tax breaks from Arizona so they were moving to the Phoenix area. I was able to take a quick tour of their vehicle. Any my company (I am a minority owner) which makes some high tech ag equipment and is building a 1/4+ $M machine every 3 or 4 days and growing and is not worth anywhere near their evaluation. We must have started at about the same time but with far less funding.

I think that their battery electric day cab local delivery truck will be an easier vehicle to sell than the fuel cell long haul truck. Anyway, we will see the how they do.

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