Nikola Corp. (NASDAQ: NKLA) stock shot up on Monday after the company announced a partnership with Republic Services Inc. (NYSE: RSG) to develop and purchase 2,500 electric waste and recycling collection trucks.
This agreement represents the industry’s first large-scale commitment to fleet electrification. The electric vehicles will have a range of 150 miles and be capable of recharging overnight.
These vehicles are expected to be integrated into the Republic Services fleet beginning in 2023. The deal is expandable to 5,000 vehicles over the life of the agreement.
For Republic Services, this collaboration represents a transformational step forward to leverage technology and innovation to reduce emissions, increase operational efficiency and provide economical, environmentally sustainable solutions to its customers.
Last year, Republic Services set a long-term sustainability goal to reduce greenhouse gas emissions by 35%.
For Nikola, this deal represents the first steps toward real revenue, even though the company has yet to get its production in line. In its most recent earnings report, the company only had revenues of $36,000, which were entirely attributable to installing solar panels for upper management.
Nikola stock traded up about 15% to $42.28 on Monday, in a post-IPO range of $10.27 to $93.99. The consensus price target is $58.33.
Republic Services traded at $90.90, in a 52-week range of $65.37 to $100.91. The consensus price target is $94.83.