Purchase is part of strategy to convert entire dedicated fleet to alternative power by 2025
After teasing a “major fleet announcement” a few weeks’ ago, Nikola Motor Company broke the news on Thursday morning: Anheuser Busch will deploy up to 800 Nikola trucks starting later this year as part of a broader emissions-free vehicle plan that will result in the company converting 100% of its dedicated fleet to sustainable sources by 2025.
“As an industry leader, we feel it is our responsibility to pull the industry forward,” said Ingrid De Ryck, vice president of procurement & sustainability for Anheuser-Busch.
Trevor Milton, founder and CEO of Nikola Motor, said the “up to 800” number depends on how quickly Nikola can build the trucks. He noted that the contract calls for 28 hydrogen fuel stations throughout the country with 2 stations and 28 trucks up and running before the end of the year. Initial locations will be announced later this year, and the first trucks will be prototype versions.
Ryder will provide all sales and service warranty coverage in the transaction, Milton said. “Ryder is going to be there to handle all the logistics behind these trucks, to make sure we have parts for these trucks … and also to make sure we have hydrogen at all the stations,” he said.
The initial trucks will be built by Fitzgerald Glider Kits, but Nikola is building a $1 billion factory in Arizona, announced earlier this year.
Anheuser-Busch’s dedicated fleet is between 750 and 900 trucks, the company said, representing about one-third of the company’s total shipments. The Nikola order could potentially replace the entire dedicated fleet by 2025, however, Anheuser-Busch said it does have current commitments for other alternative fuel vehicles.
The trucks delivered to Anheuser-Busch will be the Nikola Two, which is the day cab version. It will have a range of between 500 and 1,200 miles, produce zero emissions, and can be refueled in 20 minutes. “Nikola’s technology will help us achieve our sustainability goals,” De Ryck said.
The 28 hydrogen stations will be located near major roadways and open to the public, Milton said. Nikola will own the stations.
“We’re working with Anheuser-Busch on those stations and where they will be located and we’ll probably be making an announcement later this year,” he added.
“At Anheuser-Busch we’re continuously searching for ways to improve sustainability across our entire value chain and drive our industry forward,” said Michel Doukeris, CEO of Anheuser-Busch. “The transport industry is one that is ripe for innovative solutions and Nikola is leading the way with hydrogen-electric, zero-emission capabilities. We are very excited by the possibilities our partnership with them can offer.”
The news that a major announcement was coming broke in early April when the company announced it would refund all reservation money for its Nikola hydrogen-electric Class 8 truck. In a tweet, Nikola said that it had secured a large contract with “one of the most recognized and valuable brands in the world.” That brand turned out to be Anheuser-Busch.
In making the announcement of the refund rebate, the company told customers it doesn’t “use your money to operate our business. We want everyone to know we have never used a dollar of deposit money in the history of our company. All deposits will be refunded < 60 days.”
Days before the refund announcement, Nel Hydrogen said it received a $5.5 million purchase order from Nikola Motor. Nel provides dedicated hydrogen solutions and said it would construct 28 additional hydrogen stations for Nikola under contract. The company was already set to build up to 14 stations under a previous contract.
“We are very proud to announce that we have received an additional order from Nikola related to the electrolyzer and fueling solution for their prototype trucks. The order marks a strengthening of our partnership and is a recognition of the level of competence our team and hydrogen solutions can offer. We look forward to supplying the demo stations, which will lay the groundwork for the world’s largest, most efficient network of low-cost hydrogen production and fueling sites,” said Jon André Løkke, CEO of Nel.
In an interview with FreightWaves last year, Trevor Milton, founder & CEO of Nikola Motor, said that a fleet contracting with the company would receive 1 million miles of hydrogen fuel, plus maintenance, tires and some ancillary items such as truck washes as part of a monthly lease program.
In Thursday’s press conference, Milton said the all-inclusive lease costs between 90 cents and $1 per mile. “My generation doesn’t want to pay for assets, they want to pay when they use things,” Milton said.
Officials on the press call refused to say how much the Anheuser-Busch contract was worth, but in a $2 billion lawsuit Nikola filed against Tesla for patent infringement, it was revealed that Nikola was “offering its Nikola One with fuel, service and warranty for $900,000 for the first million miles.”
The Nikola suit alleges Tesla infringed on 3 of Nikola’s patents and says that Tesla’s infringement is causing confusion in the marketplace and hurting Nikola’s efforts to sell its vehicles, which are scheduled for testing in 2019 and production in 2021.
“The confusion has diverted sales from Nikola to Tesla,” the suit alleges. “Further, any problems with the Tesla Semi will be attributed to the Nikola One, causing harm to the Nikola brand. For example, Tesla has had problems with its batteries starting fires and its autonomous features causing fatal accidents. Should these problems arise with the Tesla Semi, the market will attribute these problems to Nikola because of the similarities between the two vehicles.”
The lawsuit said that Nikola has over $6.3 billion in orders for the truck to date.
Because hydrogen fuels the electric motor, which really powers the truck, this is a 100% emissions-free vehicle that does not need to be plugged in or suffer from any of the range limitations that electric vehicles currently have. With its electric drive/hydrogen power combination, the tractor will have an effective range of up to 1,200 mi. before a hydrogen fill-up will be needed.
Nikola hopes to eventually have a hydrogen network of 364 stations, adding 35 per year.
According to Nikola Motor, the cost to operate the Nikola One will be about half that compared to a comparative diesel-powered tractor.
The electric engine is powered by a hydrogen fuel cell and produces 2,000 lbs.-ft. of torque and 1,000 hp. with a 320 kWh battery. Regenerative braking is used to supply power. Zero to 60 acceleration under load is said to be 30 seconds as compared to 60 seconds for a diesel unit.
The battery storage system features 32,000 individual lithium-ion cells welded together for the battery pack – three times the size of a Tesla Model S P90D. MPG will be about double that of a diesel model, ranging from 13 to 15 mpg depending on specific operating conditions. With a 2,000 lbs. estimated weight saving (18,000 to 21,000 lbs. vs. 19,000 to 23,000 lbs. for a diesel unit), Nikola says that vehicles could potentially haul additional weight leading to up to $1,000 extra revenue per load.
The fuel economy edge, the company says, is achieved through aerodynamics, no idling, battery charging through regenerative braking, a 6×4 four-wheel drive configuration and the efficient electric motors (said to be up to 95% efficient) and a fuel cell up to 70% efficient.
The cab is a mid-cab design with “surround vision” and features a 15 in. touchscreen that gives the driver a virtual aerial view of the area around the truck and trailer in real time, eliminating blind spots. A panoramic windshield and a forward position for the driver provides improved visibility. That view is complemented by high-definition cameras combined with radar, sonar and computer software. The result is a complete 360 deg. view of the vehicle.
The mid-cab design features a sliding entry door to reduce the dangers of climbing into and out of the cab.
Inside the cab, there is a touchscreen where some of the most advanced productivity tools are located. Nikola aims to make the vehicle an “all-inclusive” model, giving drivers all the tools they need to do their jobs. This includes standard readouts such as battery levels, ranges, wheel torque and cabin controls, Bluetooth-enabled phone, calendar, integrated logging and driver/vehicle performance data and more. It also includes navigation and vehicle data as well as “Nikola Shipments.”
Nikola Shipments is a freight matching software, similar to the growing number of “Uber for freight” models. A driver simply enters their departure and arrival locations along with times and they will be provided a list of available shipments along the route. The driver can then filter the available shipments by value and added time.
“Our entire business plan is to be vertically integrated,” Milton said last year. “We didn’t do it to get people to buy in; it is because our entire business plan is to be the only company [that offers an end-to-end solution].”