Shares of electric truck manufacturer Nikola Corp . (NASDAQ:NKLA) experienced a significant surge in value on Thursday, enjoying a high of 37% and maintaining a 26.5% increase by mid-morning. This rise is a stark contrast to the company's recent performance, which saw a decline of over 40% within the past month.
The sudden uptick can be attributed to the company's recent forum led by CEO Steve Girsky, who assumed the position just a month ago. During the forum, Girsky addressed various pressing concerns related to the company's operations, including a large-scale recall of its battery-electric trucks and queries about its forthcoming hydrogen-powered trucks.
A key takeaway from the forum was that Nikola is on schedule to start delivering its hydrogen fuel cell trucks upon completion of final testing. This positive development has already prompted the company to commence serial production of this version of its Class 8 semitruck, with plans to initiate customer deliveries soon. Nikola has reportedly received orders for more than 200 of these hydrogen fuel cell trucks.
However, not all news from the forum was positive. Nikola has been dealing with investor concerns surrounding the recall of its battery-electric trucks due to "several thermal incidents" since June. Preliminary investigations suggest that coolant leaks within one of the battery packs are responsible for causing fires in these trucks.
Despite no concrete cost estimate for the recall and repairs being provided, Girsky outlined a specific plan to tackle this issue, which involves replacing the coolant lines connected to the battery packs. Despite this setback, investors appear to be focusing more on the company's future prospects.
Adding to this optimism is Girsky's announcement that the first batch of hydrogen fuel cell trucks rolled off Nikola's Arizona production line around two weeks ago. The company has now secured non-binding orders for over 210 such trucks. These vehicles use different battery packs from a different supplier, distinguishing them from the recalled battery-electric trucks.
Nikola's production line is equipped to manufacture both versions of the trucks and has an annual capacity of 2,400 units. With the positive news regarding its hydrogen trucks, investors are showing renewed interest in the company's stock. The successful deployment of these hydrogen trucks could potentially drive further growth in Nikola's stock value.
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