Nikola (NKLA) defends itself against scathing report and provides update on strategic initiatives

Nikola Corporation (NASDAQ: NKLA) is doing its best to set the record straight against a report published by Hindenburg Research on Thursday about its operations, which the company termed as “false and defamatory”. After taking a hit initially, the stock bounced back and was up 10% in afternoon hours on Monday. The company’s shares have jumped over 200% since the beginning of this year.

The report by activist short-seller Hindenburg contains many allegations against Nikola such as the company does not make inverters in-house and that it made false statements about its battery technology. The report also alleges that the 2016 Nikola One was a pusher and not a real truck.

On Friday, Nikola issued a statement refuting these allegations and stated that it would inform the US SEC and also consider legal action against Hindenburg.

On Monday, Nikola issued a detailed statement on the issue claiming that the report was published with the intention of negatively manipulating the market in order to financially benefit short sellers including Hindenburg. The company also said it has contacted the SEC with regards to the issue.

Clarifications

Nikola provided clarifications on these allegations stating that the company has been working on its own inverters and that at times third-party parts are used in prototype vehicles, which are then sometimes swapped for its own parts in production. The company also said that the Nikola One was designed to be powered and driven by its own propulsion but it ultimately decided to not invest in completing this design process.

Strategic initiatives

Nikola stated that it was making progress on its strategic initiatives. The company expects the Nikola Tre semi-truck to be ready for production and available to customers by the fourth quarter of 2021. The Tre is a battery-electric semi-truck developed in partnership with IVECO for the short-haul trucking sector.

Nikola will also start testing its hydrogen-electric powered semi-truck Nikola Two, intended for the medium and long-haul trucking sectors, next year. Anheuser Busch has placed an order for up to 800 trucks with a prototype to be delivered by the end of 2021, testing planned for 2022 and a production version expected in the second half of 2023.

The EV-maker has received a minimum order of 2,500 electrified refuse trucks from Republic Services Inc. with on-road testing expected to begin in early 2022 and full production deliveries to start in 2023.

Nikola anticipates it will be able to announce its hydrogen station collaboration, as well as complete its JV manufacturing facility in Germany by the end of this year. The company also expects to complete Phase 1 of its greenfield manufacturing facility in Coolidge, Arizona by the fourth quarter of 2021.

Partnership with General Motors

Last week, Nikola announced a strategic partnership with General Motors (NYSE: GM), under which the EV-maker will use GM’s Ultium battery system and Hydrotec fuel cell technology while GM will manufacture the Nikola Badger battery electric and fuel cell versions. GM will receive a $2 billion equity stake in Nikola as part of the deal. The Badger is expected to enter production by the end of 2022.