Nikola (NKLA) relocates its battery manufacturing to put all EV production under one roof

Commercial EV manufacturing Nikola Corporation announced it is moving its battery manufacturing operation from its current site in Cypress, California to its production facility in Coolidge, Arizona. With the move, Nikola will create on holistic EV assembly process all taking place under one roof.

With the start of 2023, Nikola Corporation ($NKLA) continues to make strides forward, furthering its distance from a turbulent past in the public eye. Although we haven’t seen Q4 numbers for 2022 yet, the commercial EV automaker showed signs of progress in Q3, reporting deliveries of 63 of its Tre BEV trucks and $24 million in revenue.

The company announced the acquisition of EV battery developer Romeo Power last August – a process that was made official on October 14, 2022. Nikola’s then CEO Mark Russell spoke at the time:

Romeo has been a valued supplier to Nikola, and we are excited to further leverage their technological capabilities as the landscape for vehicle electrification grows more sophisticated. With control over the essential battery pack technologies and manufacturing process, we believe we will be able to accelerate the development of our electrification platform and better serve our customers. Given our strong relationship with Romeo and ongoing collaboration, we are confident in our ability to successfully integrate and deliver the many expected strategic and financial benefits of this acquisition. We look forward to creating a zero-emissions future together.

In addition to absorbing the company and its proprietary battery technology, Nikola also took over Romeo’s production facility in Cypress, California, which it briefly renamed “Nikola’s Battery Center of Excellence.”

Now, Nikola has decided to relocate its entire EV battery operation of “excellence” to its current footprint in Arizona in order to streamline production processes and improve overall quality.

Nikola battery manufacturing, implementation moves to AZ

The company shared news of its move today, expecting the entire battery operation to function out of its Coolidge, Arizona facility by Q3 of this year. Battery manufacturing will soon join Nikola’s current truck and fuel cell power module assembly in AZ with hopes to increase production efficiencies, bolstered by new assembly line automation.

Nikola’s new president and CEO Michael Lohscheller, who replaced Russell who retired at the end of 2022, spoke to the company’s decision to move the battery production one state over:

This decision reinforces our commitment to finding ways to optimize our cost structure and create a sustainable business model. We remain focused on meeting our 2023 milestones, including pack and module production targets.

Nikola states that it will still maintain a battery engineering presence in the state of California at a separate facility, but it will focus on developing the company’s next generation of battery management system software and modules.

Furthermore, Nikola intends to continue EV battery manufacturing in Cypress through Q2 while it works to implement the proper assembly capabilities in Arizona in order to ensure a smooth transition without any halts to battery production.

We expect to hear more about this move as well how Nikola fared through 2022 during the company’s Q4 earnings call, which we’d expect to see take place before March.