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Nikola Jabs Tesla - Vows to Return Pre-Production Deposit Money

April 5, 2018

In a recent tweet apparently aimed at Tesla, electric truck OEM Nikola said it did not need customer deposits to run its business. Photo: Tom Berg
In a recent tweet apparently aimed at Tesla, electric truck OEM Nikola said it did not need customer deposits to run its business. Photo: Tom Berg

As impressive and multifaceted a company as Tesla is, its financial health has been subject to vigorous public debate for over a year now. So it was only a matter of time before its competitors in the rapidly expanding electric truck market began taking jabs at the tech company founded by Elon Musk.

In a Tweet on Wednesday, April, 4, electric truck OEM Nikola announced that it would refund 100% of the deposit money invested by customers with no loss of place “in line” for trucks ordered. “We don'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," the Tweet said – an apparent jab at Tesla, which financial analysts widely suspect is using millions of dollars in deposit money placed by Semi electric truck customers to simply keep the company’s lights on and doors open.

In a subsequent Tweet, Nikola boasted that new customers would be able to pre-order a Nikola truck without placing a deposit down, adding that with over “8+ billion” in pre-order reservations in-hand, it did not need deposits “any way.” Presumably, Nikola means that it has $8 billion worth of orders for its truck already on the books, although in the past Nikola has said it has 8,000 pre-orders in hand for its Class 8 electric truck, which it plans to build in a $1 billion manufacturing plant in Arizona with serial production slated to begin in 2021.

Tesla has previously announced that it will being serial production of its Semi electric truck next year. Musk’s company has not been as forthcoming concerning Semi orders, although the company is requiring a $5,000 deposit for each Semi ordered before production begins. According to published reports, Tesla’s Top 10 largest orders total 327 trucks, totaling more than $2 million in deposits, assuming those customers paid the publically announced amount for each truck reserved.

Tesla’s Semi truck features an all-electric drivetrain, while Nikola has announced it will use a combination of hydrogen fuel cells and electric motors to power its trucks.

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