An order of 2,500 electric garbage and recycling trucks by Republic Services from Nikola has seen the zero-emission vehicle manufacturer's stock price rise to 22.1 per cent overnight.
The waste management company based in Arizona, where Nikola is also headquartered, has provision to increase the order of Nikola Tre commercial vehicles to 5000 units.
These electric trucks, with a compact cab ideal for high density urban areas, have a range of 150 miles and can reportedly handle 1,200 residential trash cans on a single charge.
Full financial details of the transaction were not made available although it is understood production of the electric vehicles is scheduled for 2023.
On road testing is expected to begin early next year.
Republic Services is the second largest recycling and solid waste provider in the US. It operates a fleet of 16,000 trucks, of which nearly one-fifth run on natural gas.
Company President Jon Vander Ark said lower maintenance costs resultant from no longer having regenerative braking made it a compelling product offering for his business.
“Our agreement with Nikola represents the industry’s first large-scale commitment to fleet electrification," he said in a statement.
"We expect to realize significant operating-cost savings and environmental benefits from these trucks."
The refuse market was one of the most stable markets in the industry providing long-term shareholder value according to Nikola Founder and Executive Chairman Trevor Milton.
"The Nikola Tre powertrain is ideal for the refuse market as it shares and uses the same batteries, controls, inverters and e-axle," he said.
"By sharing the Tre platform, we can drive the cost down for both programs by using the same parts. You couldn't pick a better partner than Republic Services, a leader in long-term environmental sustainability and customer service," said Milton.
"Republic Services will help us ensure the Nikola Tre meets customer and fleet lifecycle demands and we are excited to have them participate in the design process."
Shares are now worth over $20 billion AUD following Nikola's reverse public offering back in June.
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