[Initial Report] Meeting Between Nikola and Heads of the 4 Major Groups

[Asia Economy Reporter Lim Jeong-su] Nikola has recently been the most talked-about company worldwide over the past month. It is a U.S.-based hydrogen fuel cell truck (including pickup trucks) manufacturer, a relatively young startup founded in 2015 by founder Trein Milton (holding a 25% stake). The company has only about 250 employees. In terms of company size, it is comparable to a small or medium-sized enterprise in Korea. It has generated almost no revenue yet and has continued to operate at a large deficit. Despite this, the company’s market capitalization surpassed Hyundai Motor’s immediately upon its Nasdaq listing (via reverse merger) in June. In Korea, it became widely known that Hanwha Group, which invested as a shareholder, made a huge profit from Nikola’s listing.

Nikola has not yet produced a single hydrogen truck capable of road driving. It has only announced plans to manufacture electric vehicles (BEV) trucks in 2021 and hydrogen fuel cell vehicles (FCEV) trucks in 2023. According to Nikola, the BEV truck can travel 300 miles (approximately 482 km) on a single charge. Nikola is responsible for key components such as battery packs, electric axles, and vehicle management parts, while the Italian complete vehicle manufacturer Iveco handles integrated production. The FCEV truck boasts a driving range of 500 to 750 miles (804 to 1,126 km). Additionally, Nikola has proposed a strategy to prioritize installing hydrogen refueling stations along logistics routes between major cities in collaboration with social commerce companies like Amazon, aiming to serve as a hydrogen-based logistics platform.

Nikola also announced that it has received pre-orders worth $10 billion (approximately 12 trillion KRW) based on these plans. The lineup of global partners participating in Nikola’s plans is impressive. Including Iveco, which handles integrated production, Bosch, the world’s largest automotive parts manufacturer, is jointly developing the powertrain. Denmark’s Nel is cooperating on hydrogen refueling stations. Germany’s EDAG is responsible for the cab and chassis, and WABCO handles the electronic braking system. Hanwha Group is participating as a supplier of solar panels.

Behind Nikola’s dazzling debut, numerous doubts about its success potential have been raised. The core skepticism centers on whether it is technically feasible to develop a hydrogen truck capable of carrying tens of tons of cargo and traveling 1,000 km on a single charge with current technology. It is also uncertain whether the company can reach mass production. Moreover, there is intense debate over whether the pre-orders worth 12 trillion KRW are genuine. However, no one seems to dispute that Nikola has sufficiently confirmed the market’s enthusiastic response and opportunity factors for hydrogen fuel cell trucks.

Turning attention to Korea, during the period when Nikola was actively pursuing its listing, the top executives of the three major Korean conglomerates also began meeting. Hyundai Motor Group’s Vice Chairman Chung Eui-sun met sequentially with Samsung Electronics Vice Chairman Lee Jae-yong, LG Group Chairman Koo Kwang-mo, and SK Group Chairman Chey Tae-won. On the 21st, Lee Jae-yong paid a return visit to Hyundai Motor’s Namyang Research Center, marking the second meeting. It is expected that they will discuss cooperation in areas such as solid-state battery development, autonomous vehicles, and next-generation mobility. These expectations carry hope that the heads of the four major groups will come together amid rapidly changing global industrial landscapes to create new business models.

Cooperation in the hydrogen vehicle sector is also noteworthy. Hyundai Motor has launched the hydrogen vehicle 'Nexo,' which can travel 600 km on a single charge, and has already established a mass production system. If LG, Samsung, and SK, which possess world-class battery technology, enhance the performance of hydrogen fuel cells, and large corporations with financial resources participate in building hydrogen refueling infrastructure, the establishment of a hydrogen truck ecosystem can be accelerated. Byproduct hydrogen generated from production waste at each group’s affiliates can also be used as fuel. If the 'pledge of brotherhood' (도원결의, Dowoongyeol-ui) among the heads of the four major groups to secure global leadership in the hydrogen economy sector beyond hydrogen fuel cell vehicles is realized, it may create value surpassing Nikola. We look forward to it.

This content was produced with the assistance of AI translation services.