All discussion of Nikola Motors

[JohnSnowNW]

I'm glad they were upfront that they are short NKLA, but I wish they weren't as it suggests the possibility of lack of objectivity. But I'm not saying I don't believe the article.

I believe that's why they used numerous citations.

 

[AudubonB]

Elsewhere - Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable - I wrote of my distaste for SPACs. What I left out there is that I consider NKLA as Evidence #1 for why SPACs should be illegal. Now, it is possible that some of Hindenburg’s arguments can be refuted, not the least of why being because I got the impression that some (unfortunately for Mr Milton, only some. By no means all) of their claims are referenced by “employees/ex-employees told us” sorts of arguments, and even if true, these can be vexingly difficult to demonstrate in a court of law. But the inescapably important point is that in a traditional raising of investment capital, effectively all the issues Hindenburg raises are ones that would have been addressed either with the audited reports that a company going public has to create and disclose, or through the crucible of questions responsible investment managers use to grill company executives prior to determining whether or not to invest in the IPO.

These necessary and appropriate procedures are 100 percent bypassed through a SPAC. The existence of SPACs almost completely thwarts the onerous yet understandable hurdles regulatory authorities have created to ensure investors will not be buying a pig in a poke.


Now, the response Mr Milton has given shows bravado but little if anything else. I’ll spar words with him thusly: “Sure - responding to the lies Hindenburg presents should take you not even the few hours you request. It is the truths that they present that might take you a far, far.....far longer time”.

 

[M|S|M MYP]

Elsewhere - Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable - I wrote of my distaste for SPACs. What I left out there is that I consider NKLA as Evidence #1 for why SPACs should be illegal. Now, it is possible that some of Hindenburg’s arguments can be refuted, not the least of why being because I got the impression that some (unfortunately for Mr Milton, only some. By no means all) of their claims are referenced by “employees/ex-employees told us” sorts of arguments, and even if true, these can be vexingly difficult to demonstrate in a court of law. But the inescapably important point is that in a traditional raising of investment capital, effectively all the issues Hindenburg raises are ones that would have been addressed either with the audited reports a company going public has to create and disclose, or through the crucible of questions responsible investment managers use to grill company executives prior to determining whether or not to invest in the IPO.

These necessary and appropriate procedures are 100 percent bypassed through a SPAC. The existence of SPACs almost completely thwarts the onerous yet understandable hurdles regulatory authorities have created to ensure investors will not be buying a pig in a poke.


Now, the response Mr Milton has given shows bravado but little if anything else. I’ll spar words with him thusly: “Sure - responding to the lies Hindenburg presents should take you not even the few hours you request. It is the truths that they present that might take you a far, far.....far longer time”.

Like i said in the other thread...SPAC's are like Chinese companies using reverse mergers to get listed....absolutely 0 credibility.

 

[Right_Said_Fred]

There's been little progress at the Coolidge factory site because they don't have a building permit. But that's Trevor's fault as they only filed for a building permit two days before the groundbreaking ceremony.

What are they going to use that factory for? To hang up their sketches? The GM deal makes clear that Nikola will not be producing anything, GM will do all of the hard work. The Hindenburg report underscores they have nothing.

 

[MP3Mike]

What are they going to use that factory for? To hang up their sketches? The GM deal makes clear that Nikola will not be producing anything, GM will do all of the hard work. The Hindenburg report underscores they have nothing.

I don't see anything in the deal about GM building the Semis. It is only to build the Badger and supply battery/fuel cell/powertrain components for their Class 8 semis that Nikola will be building in Arizona. (With the help of Iveco.)

 

[JohnSnowNW]

Elsewhere - Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable - I wrote of my distaste for SPACs. What I left out there is that I consider NKLA as Evidence #1 for why SPACs should be illegal. Now, it is possible that some of Hindenburg’s arguments can be refuted, not the least of why being because I got the impression that some (unfortunately for Mr Milton, only some. By no means all) of their claims are referenced by “employees/ex-employees told us” sorts of arguments, and even if true, these can be vexingly difficult to demonstrate in a court of law. But the inescapably important point is that in a traditional raising of investment capital, effectively all the issues Hindenburg raises are ones that would have been addressed either with the audited reports a company going public has to create and disclose, or through the crucible of questions responsible investment managers use to grill company executives prior to determining whether or not to invest in the IPO.

These necessary and appropriate procedures are 100 percent bypassed through a SPAC. The existence of SPACs almost completely thwarts the onerous yet understandable hurdles regulatory authorities have created to ensure investors will not be buying a pig in a poke.


Now, the response Mr Milton has given shows bravado but little if anything else. I’ll spar words with him thusly: “Sure - responding to the lies Hindenburg presents should take you not even the few hours you request. It is the truths that they present that might take you a far, far.....far longer time”.

Many of the, if not the most, damning parts of the analysis came from discrepancies or contradictions that Trevor made himself. The unnamed sources were really used as supporting evidence, more than anything.

 

[Fred42]

What are they going to use that factory for? To hang up their sketches? The GM deal makes clear that Nikola will not be producing anything, GM will do all of the hard work. The Hindenburg report underscores they have nothing.

I don't believe I've read anywhere that Nikola doesn't still plan to assemble its semis.

But if GM pulls out or if current info sufficiently reduces customer confidence or leads to devastating lawsuits, they won't need the assembly plant.

 

[M|S|M MYP]

No work experience or education and you're a CIO? hmmmmmm......and TM's brother is the director of hydrogen development? His brother's last job was pouring concrete in Hawaii...the drama unfolds.

 

[humbaba]

I think Mary Barra was really dumb with this deal or smart like a fox and using it take out a potential competitor.

I just don't see how diverting your resources to work with a start up with no technology or distribution channel benefits GM.

Honestly think she was forced to "do something" as they are 7-8 years behind Tesla and with the rising market value of Tesla she needed to have some strong EV association to hopefully raise the GM stock price. Unfortunately having you team now working on multiple EV's when you do not yet have one successful EV internally is not a path for success. The whole thing to me looks like GM is essentially in a panic on being so far behind.

I think it is pretty straightforward. Part of Trevor's scam is cutting deals. Because he never has anything to offer except empty promises the deals are always risk-free for the other party. Stuff like no-money-down-only-order-if-you-want deals with Republic and others. In the case of GM they get to double dip on the EV credit while being paid in order to do so. Sure, they have to design, engineer and manufacture the product -- but they are paid to expand production capacity and (theoretically) it increases unit count and helps them to lower their own per-unit costs.

That said, I'm skeptical of GM actually increasing production capacity. The reality is that even if they are only half serious about manufacturing EVs then their battery production is already spoken for for years. My expectation is that GM will find ways to bill Nikola for the $700M "to expand production" and cash out the stock as fast as they can. Any badgers made will have their profitable price increased by $7500 due to the tax break. And because they will be made for Nikola, Nikola is going to have to pay for them and then try to recoup their costs by selling them. Which may be a problem for Nikola unless they can get more money with another capital raise.

Yeah, the more I think about it the more I think all GM really expects to come of this is some profit liquidating the stock and some good press about being "pro environment" and free advertising for the Ultium product. If Nikola can actually afford to buy some badgers from them, cool, but no big either way.

 

[Oil4AsphaultOnly]

I think Mary Barra was really dumb with this deal or smart like a fox and using it take out a potential competitor.

I just don't see how diverting your resources to work with a start up with no technology or distribution channel benefits GM.

Honestly think she was forced to "do something" as they are 7-8 years behind Tesla and with the rising market value of Tesla she needed to have some strong EV association to hopefully raise the GM stock price. Unfortunately having you team now working on multiple EV's when you do not yet have one successful EV internally is not a path for success. The whole thing to me looks like GM is essentially in a panic on being so far behind.

Barra has shown countless times that she _thinks_ she's a fox. Encouraging various state dealers associations to bar Tesla from opening stores, michigan politicians to write laws specifically to bar Tesla, siding with the EPA against CARB while talking about supporting the environment, etc ad nauseam. She just hasn't realized that her schemes usually backfire, badly!

She thinks she's gotten Nikola to concede enough that GM wins no matter what, but she failed to see how badly Milton will screw things up for GM. The R&D expenses to DESIGN (that's right, I doubt that Nikola even has a workable product design) and build the product will exceed whatever money they've budgeted for it, and the $2B in NKLA will be worthless at the same time as their purchase contract becomes worthless when NKLA fails as a company.

When Trevor showed that video clip of their semi being "real" and opened the hood to reveal the sounds of the radiator fan, it was pretty clear that their truck was DOA. That engine compartment was jam packed so haphazardly that no commercial trucker would ever want to risk their business with such a monstrosity. It's a failure waiting to happen, and that's with a product that they actually have a prototype for.

No, GM will learn the hard way that some things/people are NOT worth the risk.

 

[Christine69420]

SHAREHOLDER ALERT: Block & Leviton LLP Investigating Nikola Corporation for Possible Securities Laws Violations; Shareholders Should Contact the Firm

BOSTON, MA / ACCESSWIRE / September 10, 2020 / Block & Leviton LLP (www.blockleviton.com), a national securities litigation firm, is investigating whether Nikola Corporation (NASDAQ:NKLA) and certain of its executives may be liable for securities fraud. If you purchased or acquired shares of Nikola and have questions about your legal rights or possess information relevant to this matter, please contact Block & Leviton attorneys at (617) 398-5600, via email at [email protected], or at https://www.blockleviton.com/cases/nkla.

Before the markets opened on September 10, 2020, analyst Hindenburg Research published a scathing report calling Nikola "an intricate fraud built on dozens of lies." Hindenburg wrote that it "gathered extensive evidence-including recorded phone calls, text messages, private emails, and behind-the-scenes photographs-detailing dozens of false statements by Nikola Founder Trevor Milton. We have never seen this level of deception at a public company, especially of this size."


Source: SHAREHOLDER ALERT: Block & Leviton LLP Investigating Nikola Corporation for Possible Securities Laws Violations; Shareholders Should Contact the Firm

 

[humbaba]

Barra has shown countless times that she _thinks_ she's a fox. Encouraging various state dealers associations to bar Tesla from opening stores, michigan politicians to write laws specifically to bar Tesla, siding with the EPA against CARB while talking about supporting the environment, etc ad nauseam. She just hasn't realized that her schemes usually backfire, badly!

She thinks she's gotten Nikola to concede enough that GM wins no matter what, but she failed to see how badly Milton will screw things up for GM. The R&D expenses to DESIGN (that's right, I doubt that Nikola even has a workable product design) and build the product will exceed whatever money they've budgeted for it, and the $2B in NKLA will be worthless at the same time as their purchase contract becomes worthless when NKLA fails as a company.

When Trevor showed that video clip of their semi being "real" and opened the hood to reveal the sounds of the radiator fan, it was pretty clear that their truck was DOA. That engine compartment was jam packed so haphazardly that no commercial trucker would ever want to risk their business with such a monstrosity. It's a failure waiting to happen, and that's with a product that they actually have a prototype for.

No, GM will learn the hard way that some things/people are NOT worth the risk.

While I don't disagree with your assessment of Mary Barra, I don't think GM bears any meaningful risk here. All that Nikola is providing are renderings of what they want the vehicle to look like. GM is planning on offering lots of EV models, and there will necessarily be some pickups in there. Take one of those and rebadge it as a Nikola. Sure, some modest styling changes, but essentially it will be a GM pickup. And they get to pick up whatever pennies they can from dumping the stock they are paid with.

 

[RichardL]

While I don't disagree with your assessment of Mary Barra, I don't think GM bears any meaningful risk here. All that Nikola is providing are renderings of what they want the vehicle to look like. GM is planning on offering lots of EV models, and there will necessarily be some pickups in there. Take one of those and rebadge it as a Nikola. Sure, some modest styling changes, but essentially it will be a GM pickup. And they get to pick up whatever pennies they can from dumping the stock they are paid with.

Seems true enough - but isn't there a risk to their reputation if they are seen to make a huge deal with a con artist?

 

[M|S|M MYP]

 

[humbaba]

Seems true enough - but isn't there a risk to their reputation if they are seen to make a huge deal with a con artist?

Oh, but poor, poor GM is just another victim of that clever conman!

In all seriousness? No, I don't think GM will suffer any reputation loss. For starters, I think this is materially different from Theranos, but did that really cause a reputation loss to the other companies who were conned? Safeway? Walgreens?

So I think GM is in the clear. And, unlike Elizabeth Holmes, I don't think Trevor will even be charged, much less convicted. He will surely be the target of various lawsuits and I hope that he is prosecuted. But I don't expect it.

 

[Oil4AsphaultOnly]

Seems true enough - but isn't there a risk to their reputation if they are seen to make a huge deal with a con artist?

This. There's going to be some damage to their brand. And I expect NKLA shareholders (probably with Trevor prompting them) to sue GM for "stealing" NKLA IP as part of their Badger "development". Never underestimate the wicked.

 

[humbaba]

This. There's going to be some damage to their brand. And I expect NKLA shareholders (probably with Trevor prompting them) to sue GM for "stealing" NKLA IP as part of their Badger "development". Never underestimate the wicked.

Maybe. But that would be a departure from Trevor's MO, which is to lie to potential investors/customers about capabilities and in-house expertise. While Nikola is his largest scam, it is not his first.

What was really funny to me in the short report was the bit were Trevor was scammed by the vaporware battery company. Nikola did sue over that, but if they sue GM then Nikola's fraud will come out in discovery. Trevor does not want that to happen.

 

[M|S|M MYP]

Is Nikola World still a go? Asking for a friend

 

[smorgasbord]

One thing is to look at Hindenburg's track record. Last year (2019), for instance, they attacked Bloom Energy: Bloom Energy: A “Clean” Energy Darling Wilting to its Demise

Bloom said it was lies and false conclusions the next day with this response: Bloom Energy Responds to Statements in Report Published by Hindenburg Research

But, earlier this year, Forbes did an article (The Forbes Investigation: How Bloom Energy Blew Through Billions Promising Cheap, Green Tech That Falls Short ) on Bloom Energy that said "Bloom has never generated a profit, despite at least $1.7 billion of invested capital, some of which was raised on the back of false statements."

But worse was the preface Forbes put in front of the article: "This Forbes magazine story went to press several days before Bloom Energy’s February 12, 2020, disclosure that it would be restating its prior four years’ financial statements, lowering revenue by up to $180 million, and adding $75 million to losses. "

So, I don't think one can dismiss Hindenburg's claims outright. But, even if the things they point out are true, does that mean the company will actually fail?

-----

I will say that my own prior view has been that Milton often talks about the future using the present tense. And the company has switched underlying technologies like Musk switches wives/girlfriends: First it was CNG, then some battery tech that was more energy dense than Tesla, then fuel cells, then their own battery/drivetrain technology, and now switching to GM's battery/fuel cell/drivetrain technology.

On that last point, watch this video: https://twitter.com/i/status/1303753497180078082 , starting at about 2:30 in:
Julia Chatterly: "What's left for you guys?"
Trevor Milton: "Nikola built the Badger from the group up already... The controls, the inverter, the drivetrain has been designed and built by Nikola."
But in a Squawk Box interview with Milton and GM CEO Mary Barra, (Nikola shares pop as much as 53% after General Motors takes 11% stake in electric truck maker), Milton admits Nikola was never going to build the Badger themselves, and Mary Barra actually says: "Nikola will be using...the Ultium battery platform system as well as our Hydrotech Fuel cell technology - this is a wonderful validation of our technology and then bringing our engineering and manufacturing expertise to the table."

When asked what Nikola technology GM might have access to, Barra simply restates Nikola will be using GM's battery and fuel cell technology. So, GM isn't getting any tech from Nikola. GM is getting an 11% stake in the company that they can sell pretty quickly. GM is getting a contract manufacturing deal to build Badgers for Nikola (at cost plus profit), and GM gets to use Nikola's pickups and semis as first production tests for their technology that they'll then roll into their own vehicles.

The non-conspiratorial view of this is that Milton is open to using the best battery/fuel cell/drivetrain technology they can find. As the company has grown in market cap and as Tesla has made the traditional OEMs look for ways to stay relevant, Nikola has been able to have high level discussions with the legacy OEMs who probably wouldn't have given Milton the time of day two years ago. So, you can't blame Milton for taking advantage of their improved situation to source better products.

But, at best what Milton is doing is "fake it until you make it." I'm sure he has lied and misled - the question is whether he can continue to keep saving the company before those become a real problem. Nikola still needs to show they can build hydrogen generation and fueling stations (or actually, the NEL ASA can build them in the US), and then that building and running those stations is economically viable. I suspect the first hydrogen they generate will either not be cost effective or not be generated by electrolysis (or both). But, between Invecco and now GM, they have companies who know who to build vehicle lined up to build vehicles for Nikola. All the fakery around demos and videos and changing of specs is lousy, but not company killing.

Milton will continue to ride the waves created by Elon Musk and Tesla as long as he can. And if he continues to sign up real companies, things might work out for a while, at least until things like fuel cell energy physics and costs not coming down to where they need to be become apparent, which will take several years. Milton is perhaps counting on things changing enough by then that he can pivot a few dozen more times.

 

[Cosmacelf]

The good news with the Badger is, I guess now we'll see whether there's an actual product there or not.

SPOILER ALERT

There isn't.