Nikola Shares Jumped as It Seemed to Finally Live Up to Its Promise

Nikola Corp (NKLA) shares rose about 15% on Thursday and additionally 4.7% on Friday, as investors hailed the company finally starting production of its electric truck as promised. Chief Executive Officer Mark Russell had said in a February earnings call that long awaited production should have begun on March 21 and laid out plans to deliver 300 to 500 Tre BEV semi-trucks this year. The Phoenix, Arizona-based company also reportedly expects to start production of the Tre BEV truck at its factory in Germany in June 2023.

Nikola shares are now trading at $10.11 as of Monday U.S. premarket, the stock had lost at least 35% of its value since the company's founder was charged with defrauding investors in July last year.

The electric-truck maker said at its analyst day on Wednesday it had started manufacturing Tre battery electric vehicle (BEV) at its Coolidge, Arizona facility on March 21 and would deliver 300 to 500 semi-trucks this year.

Several electric vehicle makers including legacy automakers such as Ford Motor Co (F) and General Motors (GM) that have entered the segment aim to deliver their first EVs this year as demand heats up, but higher raw material prices and supply chain woes have clouded their timelines.

Nikola does expect to become profitable at a gross level for its Tre BEV, but only by 2023, and it hopes its gross margin could grow to about 20% after 2025, while in 2022 it still expects a negative gross margin of 60% to 75%.