They are both named after inventor Nikola Tesla. They are both aiming to upend the market of predominantly gasoline and diesel-powered cars and trucks with their zero-emission technologies. And their stock prices are surging—but for different reasons.
The day on which Tesla’s shares hit an all-time high closing price of $949.92 on Monday on record-high China-made Model 3 sales, shares in competitor Nikola more than doubled since their Friday closing price, hitting $73.27 per share after soaring 104 percent on the third day of trading on the NASDAQ.
Nikola – founded in 2015 and named after the same man that Tesla used for its name – made its debut on the stock market on June 4, after merging with special purpose vehicle company VectoIQ Acquisition Corp. Stephen Girsky, the current CEO of VectoIQ and former Vice Chairman of General Motors, joined Nikola’s board of directors.
Nikola is not rivaling Tesla in the passenger car manufacturing business: it’s aiming to build battery-electric and hydrogen-electric trucks and pickups. Its long game is in zero-emission heavy-duty transportation and related infrastructure such as hydrogen station networks.
But its new electric pickup truck, Badger, could become a competition of Tesla’s Cybertruck. The Badger will have an estimated range of up to 600 miles, which is 100 miles more than the estimated maximum range of Tesla’s Cybertruck.
Nikola Share Price Doubles Just Two Days After Market Debut
On their third trading day since listing on the NASDAQ, shares in Nikola surged by 104 percent, after the company’s founder and executive chairman Trevor Milton tweeted that Nikola would open up reservations for the Badger, “the most bad ass zero emission truck” on June 29. The projected retail price of the Badger will be between US$60,000 and US$90,000, depending on the configuration, according to the company.
Nikola and its founder are betting big that policymakers will support zero-emission technology in road transportation and that investors will see the Environmental, Social, and Governance (ESG) credentials of the company.
“Nikola is thrilled to complete the Nasdaq listing and be part of the ESG investment world. This is a significant endorsement in fuel-cell and battery-electric technology,” Milton said in a statement last week when the firm announced its listing.
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So far, so good—the stock market, retail investors, traders, and fans are lapping up Nikola’s stock. The market capitalization of the company exceeded on Monday the market caps of two of Detroit’s Big Three.
“I’ve wanted to say this my whole adult life; $NKLA is now worth more than Ford and FCA. Nipping on the heels of GM. It may go up or down and that’s life but I’ll do my part to be the most accessible and direct executive on Twitter,” Milton tweeted after markets closed on Monday.
Surpassing the market capitalization of each of Ford and Fiat Chrysler Automobiles is not bad for a company that has yet to make any revenue.
Revenue Generation Expected Next Year