Friday 5 August 2022

Nikola to buy battery pack supplier Romeo Power in $144m deal

Nikola Corporation has announced it has agreed to buy battery pack supplier Romeo Power in a deal worth around $114 million (£94m).

Romeo, with headquarters in Cypress, California, is an energy storage technology company focused on designing and manufacturing lithium-ion battery modules and packs for commercial vehicle applications.

The acquisition is expected to enable significant operational improvements and cost reductions in battery pack production while the addition of Romeo's battery and battery management system are expected to support accelerated product development and improved performance for Nikola customers.

Nikola expects its integrated commercial vehicle electrification platform to reduce non-cell related battery pack costs by 30%-40% by the end of 2023 and annual cost savings of up to $350 million (£288m) by 2026.

Mark Russell, Nikola's Chief Executive Officer said: “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-emission future together.”