But Nikola’s stock price nosedived 10% Wednesday morning after the deal was publicly canceled. Wedbush analysts gave Nikola an “underperform” rating in response to the announcement, which the firm said was a “gut punch” to investors who were counting on the Republic Services deal to be a game changer for the struggling startup.
“Given the tidal wave of bad news for Nikola over the last few months this was not the news that investors wanted to see under their Christmas tree,” Wedbush analyst Dan Ives wrote in a note to investors Wednesday morning. “The company still has a Kilimanjaro like uphill climb to gain back Street credibility heading into 2021 with today’s news viewed as another step backwards,” the firm added.
Nikola said both companies agreed to cancel the deal after they determined combining new technologies and design concepts to make the electric trucks would take longer and cost more than initially anticipated.
“This was the right decision for both companies given the resources and investments required,” Nikola CEO Mark Russell said in a written statement.
“We continue to believe that electrification is the future, the waste management company said. “We believe the opportunity to learn from and partner with Romeo will continue to provide additional opportunities that support our electrification strategy.”
Nikola also said Wednesday that US deliveries of its Tre battery-electric semi-trucks will begin in 2021. The company plans to launch its first commercial hydrogen station next year. Production of its hydrogen fuel-cell-electric semi-trucks is scheduled to begin in 2023.