Electric trucking startup Nikola defends itself from short-seller fraud allegations

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Nikola Corp., the buzzy electrical trucking firm, is defending itself in opposition to prices of fraud that have been made by short-selling agency Hindenburg Analysis. The allegations got here simply days after GM introduced it was taking an 11 % stake within the startup.

Nikola stated the report from Hindenburg Analysis is “false and defamatory” and was “designed to offer a misunderstanding to buyers and to negatively manipulate the market in an effort to financially profit quick sellers, together with Hindenburg itself.”

The startup stated it has briefed the US Securities and Alternate Fee on the report and can cooperate with the company relating to its “inquiry.” (A spokesperson for the SEC declined to remark.) The Phoenix-based firm additionally stated it had employed regulation agency Kirkland and Ellis to judge its choices.

Hindenburg’s report, launched September 10th, is titled “Tips on how to Parlay an Ocean of Lies right into a Partnership with the Largest Auto OEM in America” — a reference to the information that GM was teaming up with Nikola to assist engineer and manufacture the startup’s battery-electric and hydrogen gas cell autos. Hindenburg claims that Nikola had engaged in “lies and deception” in showcasing its electrical automobile know-how, together with staging a video that confirmed one in every of its vans cruising down a hill.

“Our investigation of the location and textual content messages from a former worker reveal that the video was an elaborate ruse,” Hindenburg writes, “Nikola had the truck towed to the highest of a hill on a distant stretch of street and easily filmed it rolling down the hill.”

In an announcement Monday, Nikola stated there have been “dozens” of inaccurate statements within the report, and it outlined a number of examples. However the firm isn’t disputing that it staged the video that appeared to indicate the truck as practical.

“Nikola by no means acknowledged its truck was driving below its personal propulsion within the video, though the truck was designed to just do that (as described in earlier level),” the corporate states. “The truck was showcased and filmed by a 3rd celebration for a business. Nikola described this third-party video on the Firm’s social media as ‘In Movement.’ It was by no means described as ‘below its personal propulsion’ or ‘powertrain pushed.’”

The corporate stated it finally determined to not full the automobile and as a substitute shift sources to a different truck referred to as the Nikola Two. Nikola claims {that a} preproduction model of this truck, “hydrogen-electric powered semi-truck for the medium and long-haul trucking sectors,” can be prepared for testing in 2021.

“This three-year-old video of a Nikola prototype is irrelevant aside from the truth that the quick vendor is making an attempt to make use of it for its primary thesis,” the corporate added. “The actual fact is, Nikola has actual working hydrogen fuel-cell powered semi-trucks.”

Based in 2015, Nikola goals to make zero-emission massive rigs utilizing hydrogen gas cell know-how. Whereas numerous firms like Tesla, Daimler, Freightliner, and different established gamers and startups are engaged on all-electric vans, Nikola is without doubt one of the few pursuing hydrogen-powered massive rigs.

It’s additionally not the one EV firm with a contentious relationship with a rising contingent of quick sellers who guess cash that an organization’s inventory worth will go down. Tesla has a thriving group of quick sellers who congregate on Twitter, the place they collaborate across the “cashtag” $TSLAQ to attempt to determine what they consider is fraudulent exercise by the corporate and its CEO, Elon Musk.

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