Nikola Motors (NKLA) has issued a somewhat weak response to the allegations made in a recent report, and even admitted to faking the video of their electric hydrogen truck driving on the road.
As we reported last week, Nikola is currently in hot water after a recent report from Hindenburg Research made several allegations exposing deceptions by Nikola and its founder Trevor Milton, including several claims corroborated in previous reports from Electrek and Bloomberg.
This morning, Nikola has issued a full response to the report, and the company seems to be skating around the claims more than denying them.
For example, one of the biggest allegations is that Nikola faked a video of its prototype driving on the road in 2018.
Hindenburg showed evidence that Nikola instead towed the truck up a very long low grade hill and let it go down to produce this video of the “Nikola One Electric Semi Truck In Motion”:
In its response, Nikola is quick to call this allegation a “lie,” but it then promptly admits that the prototype wasn’t working on the video:
Short Seller Distorts Nikola One 2017 Third Party ‘Future of Transportation’ Promotion Video and Creates a Popular Lie: Hindenburg seeks to portray Nikola as misrepresenting the capabilities of the Nikola One prototype in a 2017 video produced by a third party, as ‘simply filmed rolling down a big hill.’ Nikola never stated its truck was driving under its own propulsion in the video, although the truck was designed to do just that (as described in previous point). The truck was showcased and filmed by a third party for a commercial. Nikola described this third-party video on the Company’s social media as ‘In Motion.’ It was never described as ‘under its own propulsion’ or ‘powertrain-driven.’ Nikola investors who invested during this period, in which the Company was privately held, knew the technical capability of the Nikola One at the time of their investment. This three-year-old video of a Nikola prototype is irrelevant except for the fact that the short seller is trying to use it for its main thesis. The fact is, Nikola has real working hydrogen fuel-cell powered semi-trucks. Any reports intended to suggest that Nikola’s trucks do not drive are erroneous, and recent videos of Nikola vehicles driving can be found here.
Their defense is that by saying that the truck is “in motion” and never explicitly saying that it is driving under its own propulsion, they are not actually being deceptive.
Another big claim in the report is the pattern that Milton has of claiming that Nikola develops technology in-house when they in fact buy it off the shelves.
They gave the example of the inverter in the truck’s powertrain, which Milton clearly claimed was developed in-house when giving a video tour of the truck’s powertrain, but Hindenburg’s research showed that it was a Cascadia inverter with some masking tape on it:
Here’s Nikola response to the claim that Milton was being deceptive about the inverter:
Short Seller Alleges That Nikola Buys and Does Not Make Inverters In-House: In its report, Hindenburg misrepresents that Nikola is claiming a third-party inverter is the Company’s own technology by placing a sticker over the supplier’s name. At no time did Nikola state that the inverter on the prototype truck shown in the video was the Company’s or would be used in production. Nikola has been designing, engineering, and working on its own inverters for quite some time. The Company does use third-party parts in prototype vehicles, some of which may be subsequently swapped out for its own parts in production. This is common practice among vehicle manufacturers and Nikola often blocks supplier names from the view of media and competitors. Every program is different as they require different specifications and validation.
The problem is that in the video referenced by Hindenburg, Milton is explicitly talking about the technology that Nikola is developing and touring the truck’s powertrain to show it.
At 29:30, he specially claims that the inverter is built in-house and the Cascadia inverter is clearly visible at 7:00:
Nikola released a few other counterpoints in response to the report, but the company ends up dancing around the allegations more than anything. You can read the full response here.
This is about what I expected from Trevor and Nikola for a response. It’s not the first time they do that.
I called it when Trevor said that he was going to issue a response:
The video was clearly fake. They can use their “in-motion” loophole, but this was undeniably a deceptive tactic to make people think they had a working prototype in 2018 when in fact they didn’t.
Furthermore, Nikola has the guts to claim that this video is now irrelevant because they now have a working prototype of their truck.
No. The fact that you were willing to deceive people about where you are in the development process of your truck is extremely relevant.
Then they dance around every other claim without ever properly addressing them or providing proof to refute them.
The whole post is not a rebuttal. It’s a weak attempt to justify their deception.
My favorite is the claim that the big unveiling in 2016 featured a working prototype and not a pusher —something Milton specifically claimed on stage.
This claim was corroborated by sources talking to Electrek and Bloomberg and Nikola pretty much confirms it now since they didn’t have a working prototype two years after that event.
Yet they have the guts to claim that this is not true:
Short Seller Alleges that 2016 Nikola One “was not a real truck and was, in fact, a pusher: The Nikola One is a real truck that sits in Nikola’s showroom. A pusher means a vehicle that was not designed to be moved by its own propulsion system. The Nikola One was, in fact, designed to be powered and driven by its own propulsion.
Then they go on to list a bunch of parts that worked on the truck:
- Gearbox was functional and bench tested prior to installation.
- Batteries were functional.
- Inverters functioned and powered the motors on a bench test prior to the show.
- Power steering, Suspension, Infotainment, Air Disc Brakes, High Voltage, and Air Systems were all functional.
But they never actually say that the truck was fully functional because it wasn’t. The truck was “a pusher” and couldn’t be driven on stage like Milton claimed.
Weirdly, they think that all of that is OK because they ended up with a working prototype three years after that event, but that’s not the issue.
You can be late. That’s OK.
What is not OK is that it shows Nikola, and more specifically Trevor Milton, is OK with lying and being deceptive.
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