Trevor Milton, a college dropout from Utah who is pushing to raise at least $1 billion to put hydrogen trucks on the road, is a billionaire thanks to the latest investment that valued his Nikola Motor Co. at around $3 billion.
The change in 37-year-old Milton’s status came this week when CNH Industrial, a European maker of heavy-duty work vehicles, committed $250 million to Nikola’s Series D investment round. As Nikola’s biggest shareholder, it also directly impacted Milton.
After CNH’s purchase of a 7.7% stake, CEO Milton still owns “more than 40%” of Nikola, the company tells Forbes. In August, before the CNH news, Milton owned less than 50%, said its CFO Kim Brady. At the 40%-level, Forbes values his position in the company at just under $1.1 billion. The value of that stake will grow significantly if the company raises the further $750 million it’s targeting in the current round.
Nikola aims to get thousands of futuristic hydrogen-powered trucks on the road throughout the 2020s that can travel up to 750 miles between fuelings at stations it plans to build and operate. For fleets requiring shorter-range semis, going a maximum of 300 miles per trip, Nikola will also lease battery-only variants of its Nikola One, Two and Tre trucks that will compete with Elon Musk’s Tesla Semi.
Although hydrogen is an abundant element, it’s been tough for automakers to commercialize their fuel-cell cars and SUVs owing to a lack of hydrogen fuel stations. In the U.S., hydrogen vehicles from Toyota, Honda and Hyundai are available mainly in California, the only state with hydrogen fuel stations. Although Nikola is relatively unproven at this point, it has orders for about 14,000 of its trucks, including from Anheuser-Busch, which plans to lease 800 of them.
Milton, a serial entrepreneur who only completed about a semester of college, developed a fixation on commercializing low-emission vehicles a decade ago, beginning with dHybrid Systems, an earlier startup that designed fueling systems for natural gas trucks. He sold that company to metals manufacturer Worthington Industries, which in turn provided seed capital for Nikola four years ago. Additional investors include hedge fund ValueAct Capital and NEL Hydrogen, Nikola’s Norwegian tech partner for producing hydrogen at its fuel stations.
The product of a Mormon upbringing, Milton developed an interest in the mechanics of transportation as a boy taking rides on trains operated by Union Pacific, his father’s employer. The death of his mother from cancer in his teens was a huge blow, but he says time spent in Brazil doing missionary work in impoverished areas fueled a desire to pursue goals that make people’s lives better. He founded Nikola in 2015, and early last year relocated it from Salt Lake City to Phoenix in 2018 to recruit from a bigger talent pool, particularly the large number of young engineers coming out of Arizona State University in Tempe, he tells Forbes. As the company staffs up, Milton says he’s trying to build a tight-knit culture at Nikola, adding a gym at its sprawling new headquarters and manning the grill at weekend barbecues with employees.
Nikola has positioned itself to benefit from growing carbon pollution worries that spurred tough new rules from the EU and in California, as well as diesel’s public image issues, from the sooty exhaust to Volkswagen’s emissions scandal that’s cost that company billions of dollars in fines.
As those rules “start to bite and particularly as air-quality regulations do in a great number of cities, it’s become fairly obvious that you can’t do everything with batteries–no matter how much Elon would love to,” says David Hart, a director with the E4Tech consultancy in Lausanne, Switzerland, who tracks development of clean vehicle technology. “The physics are just against you. So the hydrogen opportunity has become something that is much more real.”
Along with CNH and NEL, Nikola is getting technical and engineering support from industrial giants including Bosch, Meritor and WABCO, a maker of truck components, what Milton calls “risk-sharing” partners to help it solve the chicken and the egg problem that’s held back hydrogen car sales: Fuel companies won’t build hydrogen stations until there’s enough consumer demand. Consumers won’t buy the cars until there are fuel stations.
“People have asked, “why hasn’t Toyota succeeded? These guys are really smart,” he said in an interview. “Toyota has really been trying to push to get people to build the stations. They’ve never been able to finally break out of that.”
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