CEO and founding father of U.S. Nikola, Trevor Milton speaks throughout presentation of its new full-electric and hydrogen fuel-cell battery vans in partnership with CNH Industrial, at an occasion in Turin, Italy December 2, 2019.
Massimo Pinca | Reuters
Shares of Nikola have been within the pink for the third straight session Monday as the electrical automobile start-up disputed fraud claims made final week by short-selling agency Hindenburg Analysis.
In an announcement Monday, the corporate mentioned there have been “dozens” of inaccurate allegations within the report, and it outlined particular examples.
However Nikola is not disputing considered one of Hindenburg’s largest claims — that it staged a video exhibiting a truck that gave the impression to be practical however wasn’t, in addition to claims that the truck was absolutely practical.
Nikola shares have been down greater than 5% on Monday morning. It closed Friday at $32.13, bringing its market capitalization to $11.6 billion after a 14.5% drop.
Concerning the video, Nikola mentioned it “by no means said its truck was driving below its personal propulsion within the video, though the truck was designed to do exactly that.” Nevertheless, there additionally have been no disclaimers that the truck wasn’t functioning by itself.
“It was by no means described as ‘below its personal propulsion’ or ‘powertrain pushed,’ ” the company said. Nikola mentioned traders on the time knew the capabilities of the prototype automobile, calling the 3-year-old video “irrelevant aside from the truth that the quick vendor is attempting to make use of it for its most important thesis.”
The corporate mentioned it “finally determined to not make investments extra assets” to finish the automobile. It as an alternative shifted assets to a different pickup, referred to as the Nikola Two, which the corporate has demonstrated is self-propelled.
Hindenburg mentioned the truck was “towed to the highest of a hill on a distant stretch of street and easily filmed it rolling down the hill.” It was then utilized in a video, which Nikola mentioned was created by a 3rd occasion, through which the truck gave the impression to be driving by itself propulsion on flat roads.
The video was considered one of a number of claims within the agency’s report, which was referred to as “Nikola: How you can Parlay An Ocean of Lies Right into a Partnership With the Largest Auto OEM in America.”
The accusations got here days after General Motors mentioned it’s taking an 11% stake in Nikola. GM mentioned it deliberate to supply Nikola’s battery-electric pickup truck the Badger by the tip of 2022.
Hindenburg accused Nikola’s founder, Trevor Milton, of constructing false statements concerning the firm’s expertise with a view to develop and companion with auto firms.
Nikola has rejected the claims, calling the report “a hit job for brief sale revenue pushed by greed.” The corporate mentioned it has contacted and briefed the Securities and Alternate Fee concerning its “issues pertaining to the Hindenburg report.” It additionally has retained a regulation agency concerning potential authorized motion.
In different situations, Nikola mentioned Hindenburg mischaracterized a quote from an worker of auto provider Bosch, a companion of the corporate; misrepresented feedback from Milton about potential developments within the firm’s battery expertise; and falsely linked the departure of a chief monetary officer to refunding deposits for first-generation variations of the corporate’s semitrucks.
Nikola didn’t deal with different claims outlined by Hindenburg. These allegations included alleged misrepresentation of the capabilities of the Nikola One through the automobile’s unveiling in 2017 and claims that the corporate’s headquarters was off the grid.
Hindenburg founder Nathan Anderson mentioned the agency finds Nikola’s assertion on Monday “fully insufficient.”
“Nikola had beforehand promised a degree by level rebuttal to our report and this morning’s press launch didn’t ship on that promise,” Anderson mentioned in an e-mail to CNBC. “Within the few areas the place the corporate did reply, it largely confirmed our findings or just raised new unanswered questions. We can be issuing an in depth response.”
– CNBC’s Leslie Josephs contributed to this report.