By on October 1, 2020

Nikola Corp. has decided to reschedule the Nikola World conference that would have offered the public a look at its all-electric Badger pickup and an opportunity to see what else the company was cooking up. Under normal circumstances, we would all just fault COVID-19 and move on with our frustrating little lives. But the firm was recently accused of having misled investors on the true progress of its technology.

Those allegations were rebuffed by chairman and founder Trevor Milton… before he abruptly left the company and Nikola’s ludicrously high stock valuation pivoted in the wrong direction.

Interestingly, most of the blame seems to be staying with Milton. Nikola shares pitched up on Wednesday, despite the only major change being one more vacant office on the top floor. Meanwhile, CEO Mark Russell has been trying to get everyone stoked about Nikola World and all the amazing stuff that’s supposed to be there in December 2020. That included a view of the Badger pickup, which GM was supposed to build and the company has been taking preorders for since June.

Officially, Nikola is citing the always convenient pandemic-lockdown excuse as the main reason it cannot hold Nikola World 2020. While it could undoubtedly whip up a live stream before December, there has been no mention of an alternative strategy. The company seems adamant that the event should be open to the public or postponed until such an event can be held.

“Due to COVID-19 audience size restrictions at Arizona’s major venues, we have made the decision to reschedule an in-person Nikola World until we can bring the Nikola community together safely,” the company said in a statement. “We will continue to provide progress updates across our entire product portfolio.”

While much of that was left up to the imagination, it did say that the first Nikola Tre battery-electric semi prototypes would be “substantially completed” in Germany within the next few weeks. A bit of an oxymoron but presumably better than nothing. Limited production is said to be on track by Q4 of 2021 while the company’s primary manufacturing facility in Coolidge, AZ, is supposed to finish construction by the summer of 2023.

Meanwhile, its planned partnership with General Motors has also been forestalled. The duo was supposed to finalize their deal on Wednesday but the Detroit Free Press reported on Tuesday that GM had delayed signing. It’s assumed the automaker wants to renegotiate terms following the recent claims that Milton acted fraudulently. He has also been accused by two women of sexual assault before they turned 18.

Though it’s likely the money that has GM most worried. Back when it agreed to partner with Nikola, the firm was worth a cool $2 billion and had what everyone assumed was some of the most advanced battery and hydrogen tech in the industry. The company is now worth about half that and has left everyone wondering as to the legitimacy of some of the previewed equipment.

“Given how far Nikola’s equity has fallen, Milton leaving, and a fraud investigation, I can’t imagine GM is fine with the original terms of the deal anymore and I suspect they are looking for a lot more Nikola equity,” Morningstar’s David Whiston told the Free Press. “They may get it too because if GM walks away, then I believe that news would likely cause further mass selling off of Nikola’s stock.”

[Images: Nikola]

 

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17 Comments on “Nikola Delays World Conference, GM Stalls Partnership...”


  • avatar

    I suspect Nikola is building trucks that do not even have viable engines. The story of a Nikola truck going downhill without an engine for a promotional film should have been a red flag to everyone. This is not a real company. However, it could be an elaborate con job.

    • 0 avatar
      Cicero

      The similarities to Theranos are uncanny.

      Theranos had a charismatic college dropout as its visionary; Nikola had a charismatic high school dropout.

      Neither promoter had any specialized technical background but both came up with an idea for a revolutionary product before anyone knew whether the product was technologically feasible. The Theranos product was not feasible; the jury is still out on the Nikola product.

      Both publicly claimed highly advanced technology that neither actually possessed. Nikola was actually buying off-the-shelf components for its truck and Theranos was quietly using Siemens blood analysis machines to test the samples that were supposedly being tested successfully by its own “Edison” device.

      Both dressed up their operations with the superficial trappings of success and it conned investors. Nikola had a striking Rimac-designed truck that was nothing but an elaborate mock-up, and that it had to roll down a hill to film it “in motion”; Theranos had a table-top blood testing device that was designed by a former Apple industrial designer that looked revolutionary, even if it never worked.

      Both companies successfully persuaded established businesses to enter into lucrative deals with them, adding to the aura of another Tesla or Apple in the making. None of these businesses noticed the red flags

      Theranos is no more and its promoter is fighting to stay out of prison. I wonder where Nikola will be a year from now.

  • avatar
    SCE to AUX

    “…and had what everyone assumed was some of the most advanced battery and hydrogen tech in the industry”

    Everyone? Not around here.

    Besides, ‘hydrogen tech’ has no future unless some extremely brave private enterprise builds its own cost-effective hydrogen equivalent of the Supercharger network. That won’t happen, and that’s not the only problem with hydrogen.

    The far-off date for the Nikola plant is reminiscent of the Faraday Future plant debacle.

    We’re past due for a Nikola Death Watch. I’d bet a lot of their employees are looking for jobs right now.

    • 0 avatar
      Flipper35

      But, but, hydrogen is plentiful!

      On a serious note, there are other actual fuels that can be used for fuel cells that are far cheaper.

      • 0 avatar
        ScarecrowRepair

        Memory sez …. the original rationalization for hydrogen was that refueling stations would use solar power to electrocute water and make hydrogen in place. No hydrogen tankers.

        I never saw any estimates of how much solar paneling would be needed to make enough hydrogen for all the busy traffic needed to be profitable. I imagine it would be quite a lot to match any gas station.

  • avatar
    trackratmk1

    Nikola World cancelled because they have nothing to show, stock goes up. GM warns that deal is not done yet, stock goes up. No news overnight, pre-market up 10%. Water is dry, the sky is green, and down is up.

  • avatar
    Cicero

    “Back when it agreed to partner with Nikola, the firm was worth a cool $2 billion and had what everyone assumed was some of the most advanced battery and hydrogen tech in the industry.”

    They ASSUMED?

    Patents are public records. You can download copies of them from the government’s USPTO website for free. It takes like, twenty minutes to run a search.

    Didn’t anyone at GM check to see whether to see whether Nikola actually owned any cutting edge fuel cell or battery technology before it jumped into this deal?

    This just seems like appalling incompetence on GM’s part.

    • 0 avatar
      Scott

      Except as I recall the announcement of GM working with stated that Nikola was going to be using GM technology, so I don’t think that GM thought Nikola had too much of their own to tell the truth. I am not sure what Nikola Had that GM wanted to be a part of, maybe a name, and a design that they thought might get some extra sales? Not sure what the thinking was really.

      • 0 avatar
        Varezhka

        I always assumed that GM just wanted access to the pile of investment that Nikola was getting.

        GM developing their own EV platform only draw yawns from the stock market, so Nikola can announce new pickup and generate the development cash while GM does the actual engineering (which they can use for their own or license out further).

  • avatar
    jkross22

    “This just seems like appalling incompetence on GM’s part.”

    Yes, it does. It’s almost as though their CEO, COO and entire board have no idea what they’re doing and are out of their depth for the roles they occupy and compensation they earn.

    Is it too early to bring back the term “Board of Bystanders”?

  • avatar
    texasjack

    GM just got a pig in a poke. Heads should roll on this deal.

  • avatar

    “Milton acted fraudulently. He has also been accused by two women of sexual assault before they turned 18.”

    It is very presidential. Milton for President!

  • avatar

    Hydrogen-powered EVs are better suited for the long haul trucking than BEVs that has to carry super heavy batteries even when they are empty. So I understand why Nicola is so attractive to GM. On the other hand hydrogen hydrogen-powered EVs are much less effective than BEV because hydrogen production and transportation consumes a lot of energy. Nikolas solution is a right mix of both technologies and economically more advantageous than what Tesla may offer.

  • avatar
    Detroit-X

    The GM-Niloka “partnership” was/is the match made in heaven. Scam artist joins scam artist. Both reinforce their ass-clown management cultures, … for the good of, well, the stock price (and China).

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