A solution for this issue was found here: https://discussions.apple.com/thread/8262732

• In Disk Utility, switch the View option to “Show All Devices”.
• Select the entry named “PCIe SSD Media”, with “TBT3_SSD” indented below it.
• Click on Erase.
• Change the Scheme to “GUID Partition Map”. The Format choices will then expand to include several APFS choices.
• Set the Format to “APFS”.
• Press Erase.