Welcome to Tesla Motors Club
Discuss Tesla's Model S, Model 3, Model X, Model Y, Cybertruck, Roadster and More.
Register

All discussion of Nikola Motors

This site may earn commission on affiliate links.
I just spent some time reading the GM announcement of the Nikola partnership.
It is painful to read so much text that says so little but I was reminded of an old saying bandied about in the days when people were buying kits to work at home: it is a bad idea to pay for a job.

GM paid Nikola* to buy GM products for a market that does not exist.


* To quote the blurb: "General Motors to receive $2 billion equity stake in Nikola in exchange for certain in-kind contributions."
 
Nikola insider needs a refresher in pack architecture. If anything, Tesla has proven that parallelism is not an obstacle per se to quality packs.

Yes. And remember, Tesla's first battery, the Roadster ESS, has 6,831 lithium ion cells arranged into 11 "sheets" connected in series; each sheet contains 9 "bricks" connected in series; each "brick" contains 69 cells connected in parallel (11S 9S 69P). Tesla Roadster (2008) - Wikipedia.

I realize pouch and large-format cells have different properties than the cylindrical cells Tesla uses, but the same principles of series and parallel apply.
 
Yes. And remember, Tesla's first battery, the Roadster ESS, has 6,831 lithium ion cells arranged into 11 "sheets" connected in series; each sheet contains 9 "bricks" connected in series; each "brick" contains 69 cells connected in parallel (11S 9S 69P). Tesla Roadster (2008) - Wikipedia.

I realize pouch and large-format cells have different properties than the cylindrical cells Tesla uses, but the same principles of series and parallel apply.
Yeah, but each sheet (module) is in series. What they were speaking against would be putting sheets in parallel.

Realistically though, if the choice is between a single module shorting and the entire pack shorting through a module, the module is the better option, but neither is good. That's why each cell in Tesla's pack is fused. Limits the fault current at a really low level.
 
  • Like
Reactions: MP3Mike
I just spent some time reading the GM announcement of the Nikola partnership.
It is painful to read so much text that says so little but I was reminded of an old saying bandied about in the days when people were buying kits to work at home: it is a bad idea to pay for a job.

GM paid Nikola* to buy GM products for a market that does not exist.

* To quote the blurb: "General Motors to receive $2 billion equity stake in Nikola in exchange for certain in-kind contributions."

How did you translate "receive" into "paying"? That's not happening.

This deal, if it holds, put GM in a win-win position:
  • GM gets 11% of NKLA (which isn't worth what is was, but it's currently still non-zero).
  • GM gets paid cost plus guaranteed profit for all vehicles they build for Nikola
  • GM gets paid $700M for tooling specific to Nikola's models (ie, shared components are paid for by GM, but GM would have to do that anyway for their models)
  • GM gets most of the EV credits, and has options to buy more
  • GM gets additional volume discounts from making more vehicles with their powertrain, chassis, etc. by having more vehicles being built with them (and the additional vehicles are at a guaranteed profit).
The only things GM gives are:
  • Engineering for the vehicle, but they'd have to do that anyway to make their own pickups.
  • Validation for the vehicle, but they'd have to do that anyway to make their own pickups.
  • Putting their name in the same basket as Nikola.
The latter is as bad as it gets, so if they're not backing out now, my guess is they'll stick around as long as Nikola pays their bills.
 
But Tesla doesn't put packs in parallel, which is what Nikola is doing.

Do we actually know that Romeo wasn't helping Nikola with new wiring/BMS/software? However you want to define cell, brick, sheet, module, and pack, I assume the differences are wiring and management.

EDIT: This is Nikola, so I should have said "Do we actually know that Romeo was doing new wiring/BMS/Software?" Nikola doesn't appear to have done anything themselves except infotainment software. And the head guy in a video thought his own team's product was just "reasonably responsive."
 
I have been thinking of the various presentations and documents that have come from Nikola and Mr Milton ("NM" hereafter), and the number of comments - some here, some on other parts of the interwebs - along the lines of "See that! There's some weasel wording that will let them get out of any legal trouble! They're not saying 'I swear on my grandmother's grave that this specific intercabulator I'm pointing to is one we built from scratch and pulled off our 50 units/minute production line', so all will be well!"....

and then I thought about two other situations.

One is a corporation's yearly audit. The accounting firm looks through all the numbers a company provides, and asks for a representative set of more specific data, like receipts and order fills and such. They present their findings ALWAYS with the caveat that their conclusion is based upon material presented to them from the company - in other words, they rely on a presumption of truth from their client. That might - or might not - for example, include a request to see the invoices for the PV panels stated to exist on the HQ's roof. The auditor will not, I guarantee you, climb up the roof's access ladder to check.

The second is the Reasonable Person standard. Now, I am not a lawyer, but I did spend last night in the clink.

And that means...that I know this doctrine/tenet/policy/standard still exists in the USofA. Cutting/pasting from a random page on the internet, we have:

A phrase frequently used in tort and criminal law to denote a hypothetical person in society who exercises average care, skill, and judgment in conduct and who serves as a comparative standard for determining liability.

The decision whether an accused is guilty of a given offense might involve the application of an objective test in which the conduct of the accused is compared to that of a reasonable person under similar circumstances. In most cases, persons with greater than average skills, or with special duties to society, are held to a higher standard

So, without attempting to kangaroo court NM, what is both of interest and of utility to the investor is to make a determination as to whether the wordings and presentations NM have made are ones that a Reasonable Person would believe to be true. Should that inverter (?) Milton points to when discussing items made in house be assumed to be made in house...or not? Should a video of a truck under way be considered to be automotive or gravimotive? Should a declaration that its HQ is 100% reliant on electricity from its rooftop panels be taken prima facie, or ought the Reasonable Person look upstairs?

There are a very, VERY large number of such statements that can be subjected to this standard. Those who have read my earlier statements know where I stand regarding what the Reasonable Person would - ought - to conclude. And, I argue, to the extent that those conclusions are wrong determine the extent to which NM is guilty.
 
Last edited:
  • Like
Reactions: SageBrush
The auditor will not, I guarantee you, climb up the roof's access ladder to check.

I'm not so sure about that. Having dealt with a lot of auditors they went through the books and picked a bunch of items and then came to me and said I want you to show me all of these things. Some required a trip to the server room, others required having someone bring their equipment from home into the office for inspection. The funniest was where they asked to see the 342) "60x48 blue w/oak trim" items. I just said you are leaning on one of them right now, you are welcome to walk through the office and count them all. (They were the cube partition panels.) At least they didn't have serial numbers that they needed to validate like with all of the IT equipment. ;)
 
Last edited:
I have been thinking of the various presentations and documents that have come from Nikola and Mr Milton ("NM" hereafter), and the number of comments - some here, some on other parts of the interwebs - along the lines of "See that! There's some weasel wording that will let them get out of any legal trouble! They're not saying 'I swear on my grandmother's grave that this specific intercabulator I'm pointing to is one we built from scratch and pulled off our 50 units/minute production line', so all will be well!"....

and then I thought about two other situations.

One is a corporation's yearly audit. The accounting firm looks through all the numbers a company provides, and asks for a representative set of more specific data, like receipts and order fills and such. They present their findings ALWAYS with the caveat that their conclusion is based upon material presented to them from the company - in other words, they rely on a presumption of truth from their client. That might - or might not - for example, include a request to see the invoices for the PV panels stated to exist on the HQ's roof. The auditor will not, I guarantee you, climb up the roof's access ladder to check.

The second is the Reasonable Person standard. Now, I am not a lawyer, but I did spend last night in the clink.

And that means...that I know this doctrine/tenet/policy/standard still exists in the USofA. Cutting/pasting from a random page on the internet, we have:

A phrase frequently used in tort and criminal law to denote a hypothetical person in society who exercises average care, skill, and judgment in conduct and who serves as a comparative standard for determining liability.

The decision whether an accused is guilty of a given offense might involve the application of an objective test in which the conduct of the accused is compared to that of a reasonable person under similar circumstances. In most cases, persons with greater than average skills, or with special duties to society, are held to a higher standard

So, without attempting to kangaroo court NM, what is both of interest and of utility to the investor is to make a determination as to whether the wordings and presentations NM have made are ones that a Reasonable Person would believe to be true. Should that inverter (?) Milton points to when discussing items made in house be assumed to be made in house...or not? Should a video of a truck under way be considered to be automotive or gravimotive? Should a declaration that its HQ is 100% reliant on electricity from its rooftop panels be taken prima facie, or ought the Reasonable Person look upstairs?

There are a very, VERY large number of such statements that can be subjected to this standard. Those who have read my earlier statements know where I stand regarding what the Reasonable Person would - ought - to conclude.


Well, the phrase "an objective test in which the conduct of the accused is compared to that of a reasonable person" is an oxymoron, in that something which depends on the definition of "reasonable" can't be "objective." But, I get your gist.

I agree that different statements made by Trevor and Nikola exhibit differing degrees of being misleading. However, the official response from Nikola, not Trevor, while perhaps legally defends both the "in motion" truck video as well as "not a pusher," it does set a bad, perhaps unworkable, future precedent for interpreting all official company statements forever. How can anyone trust anything the company says moving forward unless it's a very specific response?

For instance, if Nikola says "We will build 100 trucks this quarter." There needs to be a bunch of follow-up question:
  • What model trucks are you building?
  • What is your definition of building? Does that mean trucks coming off the line?
  • What is your definition of "coming off the line?" Previous statements for "coming off the line"were supported by photos of trucks still ON the line.
  • What drivetrains are in those trucks?
  • Do those trucks run on their own power?
  • Will those trucks use both batteries and fuel cells?
  • Can the hydrogen tanks be fully pressurized?
  • etc.
You see where I'm going with this. If the company is going to defend its prior public statements with legalese and weasel words, then they've set themselves up to have all future statements be subject to the same legalese and weasel word scrutiny. This isn't just about Trevor anymore, the gravity video and description weren't from Trevor, they were from Nikola's official youtube account. The defense of "not a pusher" was not from Trevor, it was a Nikola official press release.

They would have been better off apologizing for "being too enthusiastic" and promise to not hype in the future. Instead, they've defended being misleading, which means they've put everyone else on notice that they will continue to be misleading.
 
I'm not so sure about that. Having dealt with a lot of auditors they went through the books and picked a bunch of items and then came to me and said I want you to show me all of these things. Some required a trip to the server room, others required having someone bring their equipment from home into the office for inspection. The funniest was where they asked to see the 342) "60x48 blue w/oak trim" items. I just said you are leaning on one of them right now, you are welcome to walk through the office and count them all. (They were the cube partition panels.) At least they didn't have serial numbers that they needed to validate like with all of the IT equipment. ;)
Those with long memories - and in this forum, the few that can pass that cut might include @jbcarioca and....well, not many others from the world of business - might remember the case of Billy Sol Estes. In the early 1960s, he was lauded as a wunderkind up-by-the-bootstraps businessman, having cornered just about every facet of the heavy equipment market - construction and agriculture - in a vast swath of Texas. He did this by showing lending agencies all his equipment all over the state. Billy Sol Estes garnered many "Businessman of the Year" type awards.

Except - it was all the same equipment, that his team kept shuffling to the next site just ahead of the moneybags' visits. I believe auditors got a lot stricter after that particular Emperor was shown to have Very Few Clothes. Here's some from his obit: Billie Sol Estes, Texas Con Man Whose Fall Shook Up Washington, Dies at 88

Here's another from my own corner of the world. Fortunately for my sake, I am not knowingly related to anyone on either side of this story. But it shows how an auditor can not be expected to keep ahead of someone with mischievous intentions. From 1930s New Hampshire:

A particular logger/landowner was interested in divesting. So he showed a particular stretch of forest to an interested party, and they looked upon fine pine after particularly fine pine. A very appealing amount of high quality board feet, and a deal was struck.

If you've guessed the punch line, you're right. Never trust a New Englander familiar with his own tortuous terrain not to run you around Robin Hood's barn showing you the same set of trees multiple times.

So: pulling the wool over others' eyes is a long and dishonorable tradition. Sometimes audits will find discrepancies - most of these, however, will be mathematical errors or judgmental disputes. It can be supremely difficult to uncover the shenanigans of those with mischievous intent.
 
I'm not so sure about that. Having dealt with a lot of auditors they went through the books and picked a bunch of items and then came to me and said I want you to show me all of these things. Some required a trip to the server room, others required having someone bring their equipment from home into the office for inspection. The funniest was where they asked to see the 342) "60x48 blue w/oak trim" items. I just said you are leaning on one of them right now, you are welcome to walk through the office and count them all. (They were the cube partition panels.) At least they didn't have serial numbers that they needed to validate like with all of the IT equipment. ;)

...auditors :rolleyes:
 
So there's 2 different types of credits in play here.


The EV emissions credits-these are used by ICE car makers to offset their emissions

And those GM could just build their own EVs and get.

But it's obviously better to have Nikola PAY GM to build Nikola EVs, and GM gets the emissions credits plus gets paid cost plus profits on building the EV factory and the actual EVs for Nikola.

That's objectively, financially, better for GM assuming Nikola continues to exist and pay bills.



Then there's the $7500 EV tax credit to buyers- that begins phaseout after a given manufacturer sells 200,000 EVs.... GM can not just make a new company they own to get more credits. But they CAN contract out to a TOTALLY DIFFERENT company to do all the actual work of building them, say, their own EV factory and some EV pickup trucks, all 100% using GMs technology and engineering, and THOSE, coming from a different manufacturer, would get another fresh 200,000 credits to make them sell-able at a $7500 cheaper net price than GM could sell trucks for to consumer.



Again there is zero downside here for GM other than bad PR.

They are bringing no cash to the deal. Nikola is bringing a ton of stock AND at least 700 million cash to it (plus however else they can sca^h^h^h convince buyers to front for deposits or more shares or whatever.

Everything GM will provide to Nikola is on a cost plus basis so GM makes money on everything even during the development and testing stages- plus the potential credits benefits if they make it to actually selling any vehicles.

there is another downside for General Motors besides bad PR. Wasted energy and effort.
 
  • Like
Reactions: Yuri_G
Those with long memories - and in this forum, the few that can pass that cut might include @jbcarioca and....well, not many others from the world of business - might remember the case of Billy Sol Estes. In the early 1960s, he was lauded as a wunderkind up-by-the-bootstraps businessman, having cornered just about every facet of the heavy equipment market - construction and agriculture - in a vast swath of Texas. He did this by showing lending agencies all his equipment all over the state. Billy Sol Estes garnered many "Businessman of the Year" type awards.

Except - it was all the same equipment, that his team kept shuffling to the next site just ahead of the moneybags' visits. I believe auditors got a lot stricter after that particular Emperor was shown to have Very Few Clothes. Here's some from his obit: Billie Sol Estes, Texas Con Man Whose Fall Shook Up Washington, Dies at 88

Here's another from my own corner of the world. Fortunately for my sake, I am not knowingly related to anyone on either side of this story. But it shows how an auditor can not be expected to keep ahead of someone with mischievous intentions. From 1930s New Hampshire:

A particular logger/landowner was interested in divesting. So he showed a particular stretch of forest to an interested party, and they looked upon fine pine after particular fine pine. A very appealing amount of high quality board feet, and a deal was struck.

If you've guessed the punch line, you're right. Never trust a New Englander familiar with his own tortuous terrain not to run you around Robin Hood's barn showing you the same set of trees multiple times.

So: pulling the wool over others' eyes is a long and dishonorable tradition. Sometimes audits will find discrepancies - most of these, however, will be mathematical errors or judgmental disputes. It can be supremely difficult to uncover the shenanigans of those with mischievous intent.
And let's not forget Crazy Eddie and his empty boxes of inventory... The auditors verified the contents of the boxes stacked in the front row(s), but wrongly assumed the boxes behind them likewise had equipment in them. :)
 
Last edited: