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CEO steers Nikola to localization of batteries and fuel cells

Michael Lohscheller became Nikola Corp.’s third CEO late in 2022. He rapidly has focused the company on conserving cash while meeting its promise for a hydrogen fuel cell Class 8 truck by the second half of this year.

Then there’s the task of standing up Nikola’s newly branded hydrogen business, recently christened HYLA.

Nikola Chairman Steve Girsky hand-picked Lohscheller to succeed Mark Russell in the top job. He earlier tapped Lohscheller as CFO and later CEO of European carmaker Opel when Girsky was vice chairman of General Motors. Lohscheller also served as CFO at Mitsubishi Motors and Volkswagen Group.

The German-born Lohscheller left Opel — now owned by Stellantis — in 2021 and did a brief tour at Vietnamese electric car startup Vinfast before reuniting with Girsky at Nikola.

Known as a tough cost-cutter, Lohscheller as Nikola president oversaw last year’s 7% head count reduction. He discussed a range of topics in his Global Supply Chain Week keynote on Thursday.

FREIGHTWAVES: We’re coming off a couple years where the supply chain crisis has gripped the trucking industry. That appears to be easing. Is that your read?

LOHSCHELLER: I think we see the supply chain is improving overall. But for us as a new company, obviously there’s a lot we have to improve. It’s not only the availability of the parts. It’s also the efficiency or the processes. But I think we are on a good path. Production is improving and I think we also have a great supply chain team working through all the challenges.

FREIGHTWAVES: Nikola struggled with certain items like display screens that prevented some deliveries. But you put the Tre battery-electric truck into customers’ hands for evaluation.

LOHSCHELLER: The point you refer to is specifically preproduction and demo trucks where we knew we had issues. It is not uncommon to say, ‘Hey, let’s work through that.’ But when we [started building] production trucks in March of last year, we were really in good shape.   

FREIGHTWAVES: Nikola protected its supply chain for battery packs by purchasing your supplier. Can you describe the process that you’re working through to integrate Romeo Power into your business?

LOHSCHELLER: The battery’s obviously a key component of the electric truck. It’s of highest strategic importance, and therefore I pushed very hard to make this acquisition happen because I feel vertical integration makes so much sense. Having the battery in our control, we can now manage all the aspects of the business.

Of course, taking over a company and making sure the integration works is a lot of work. But I think we do this very well. We have integrated the team into Nikola. We talk the same language. We have lots of things to work through, but costs are coming down.

FREIGHTWAVES: Are you able to increase your battery production now that you are taking battery production into Coolidge, Arizona, from California?

LOHSCHELLER: Bringing things together in one location makes it much easier. You don’t have to ship things for a long period of time. 

FREIGHTWAVES: You are also assembling the fuel cells in Coolidge?

LOHSCHELLER: Localization is key because I think the times are over where you can ship parts around the world. We have a world-class factory in Coolidge. We build it up in record time. We have a great team there. Now let’s utilize it to the maximum, and that is exactly what we are doing.

We will also localize the fuel cell power module over time so that you have all key components of our two trucks in Coolidge. I think this is a very big benefit. Everything is close by. It will be much, much better in terms of cost, in terms of quality. By the way, we try to do the same in Europe where we have  a plant in Germany [with Iveco] where we want to localize as much as possible.

FREIGHTWAVES: Where are the major supply chain challenges in being the first to put these trucks on the road?

LOHSCHELLER: We cannot do everything on our own. We have to team up with various partners, be it Plug Power on the hydrogen side, be it TC Energy. I think it’s essential that we bring partners together because it’s much easier, much faster.

LIsten to Lohscheller’s full keynote from the third day of Global Supply Chain Week (link here.)

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Click for more FreightWaves articles by Alan Adler.