Trevor Milton from Nikola presented the company’s new full-electric and hydrogen fuel-cell battery trucks at an event in Turin, Italy, last year.
Photo: Massimo Pinca/REUTERSNikola Corp. NKLA 15.99% said Monday it secured an order to make at least 2,500 electric garbage trucks for refuse giant Republic Services Inc., RSG -0.23% fulfilling one of the electric-vehicle startup’s three major business goals for the year.
Trevor Milton, Nikola’s founder, said in an interview the move represents an important development for the trucking industry he hopes to disrupt. Traditional refuse trucks, he said, are “dirty, loud and pollute like crazy.” The battery-powered versions will travel 150 miles on a charge, he said, capable of emptying 1,200 garbage pails before plugging in.
The order indicates a big change for the refuse industry, Republic Services President Jon Vander Ark said. Predetermined routes, constant stopping and starting, and the ability to park the trucks for charging overnight or to swap out batteries bolster the business case for a shift to e-trucks.
Production of the vehicles is slated to take place at a factory Nikola is starting to build in Coolidge, Ariz., near Republic Services’ headquarters.
Nikola aims to start testing the trucks in 2022 and begin full production in 2023. While Republic Services’ cost per truck is currently undisclosed, Mr. Milton committed to a price tag under $500,000 per unit—which is the going rate for electric garbage trucks currently sold by competitors, he said. Prices for new gasoline-powered garbage trucks fall in a range of nearly $200,000 to more than $300,000.
“We’ve done our homework, and we’ve talked to everybody,” Mr. Vander Ark said. The trucks will come with higher upfront costs that could be driven down over time due to lower maintenance and usage costs. Republic Services said it could bump up its order to 5,000 units.
Nikola will assemble the entire truck in its factory.
Often compared to electric-vehicle maker Tesla Inc., Nikola drew big attention in the EV market after it began publicly trading through a merger in early June. In July, it broke ground in Coolidge, which is near Phoenix.
Shares skyrocketed early on, surpassing the market value of Ford Motor Co. for a period, before significantly cooling off. Friday’s closing price of $36.72 represented a 9% increase over the stock’s price when the company launched its IPO, but a 60% decline from its June 9 high.
Nikola’s long-term plan is to be a leader in passenger and heavy trucks that rely on batteries or fuel cells for power. Larger trucks—such as semis—currently run on diesel or compressed natural gas.
The company doesn’t currently sell trucks to end users. It pulled in $36,000 in revenue from solar panel installations during the second quarter, representing its only sales, and reported an $86 million loss.
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Mr. Milton said in an interview that Nikola needs to keep delivering proof points until it actually builds trucks. “If we didn’t have anything to talk about we’d have a bad situation,” he said.
Tesla plans to use its own technology to build the company’s all-electric Semi truck, including batteries produced at its factory outside Reno, Nev., that supplies its passenger vehicles. Nikola aims for a less vertical model, relying on partnerships and a diverse supply chain.
During a recent earnings call, analysts questioned the company’s plans and timing. Mr. Milton said the Republic order is validation for his plans because it comes well before the end of 2020, which is the timeline he promised for a large-volume order to be announced.
Mr. Milton said the Republic order is the first of three major milestones Nikola will announce before year’s end. He said the company will soon identify an auto maker it will partner with to produce the “Badger,” a passenger-sized pickup truck; it will also name its partner for building a network of hydrogen fueling stations.
Anheuser-Busch placed an order two years ago for as many as 800 Nikola hydrogen-electric trucks, among the largest orders for alternative-fuel vehicles. The U.S. subsidiary of Anheuser-Busch InBev SA has said it plans to use the vehicles for long-haul deliveries from breweries to its distributors and Nikola will build hydrogen stations along the routes.
Write to John D. Stoll at john.stoll@wsj.com
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