(Reuters) - Republic Services Inc (NYSE:RSG) will partner with Nikola Corp, a maker of hydrogen-fueled vehicles, to develop 2,500 electric waste and recycling collection trucks, the companies said on Monday.
Nikola shares jumped nearly 22% in afternoon trading.
Ambitious greenhouse gas reduction targets set by governments around the world are driving the development of alternatively-powered vehicles, with some countries already committing to phasing out traditional combustion engines.
The zero-emission vehicles, which will have a range of 150 miles (241.4 km), are expected to be integrated into Republic Services' fleet beginning in 2023, the companies said. (https://prn.to/3fRIdGp)
Republic, a recycling and non-hazardous solid waste disposal firm, highlighted quieter operation in neighborhoods, lower maintenance costs, and lower emissions as benefits of electrifying its fleet.
The deal is expandable to 5,000 vehicles over the life of the agreement, the companies added.
Major vehicle manufacturers around the world have electric or fuel cell models in their product line-ups, but investment in the technology, coupled with a global automotive sector downturn, has squeezed profits and led to staff and cost cuts.
Along with Hyundai Motor Co and Toyota, Nikola is one of a few automakers to have backed hydrogen cars.
The company is aiming to start production of its Badger pickup truck in 2022 or earlier, which will compete with electric car maker Tesla (NASDAQ:TSLA) Inc's Cybertruck. The pickup truck is expected to be available in both electric and fuel-cell versions.