
Nikola: How to Parlay an Ocean of Lies into a Partnership with GM - aripickar
https://hindenburgresearch.com/nikola/
======
eigenvalue
It does sound pretty bad, doesn't it? The guy certainly seems to have a
problem with telling the truth. I think it's crazy to compare him to Musk,
since Musk is actually extremely smart and knowledgeable about multiple areas
of engineering. This other guy is just parotting the same lines, like "we are
an advanced energy company that just happens to sell cars!". It's like the
cargo-cult version of Tesla without any interesting technology or innovation.
All that being said, I hope the author of this write-up has a good lawyer!

~~~
sokoloff
Musk has also had some interesting/uneasy relationship history with the truth.
This guy does seem to be taking it quite a bit farther and leaving a lot more
daylight visible between his statements and the truth.

~~~
saberience
Musk has actually delivered ground breaking tech in multiple fields though. He
talks big but he usually (eventually) backs it up. No other company has
managed to send rockets to space and then land them again. No other company
has managed to sell fully electric cars en-masse like Tesla has done.

~~~
empiko
Yeah, he certainly invests in innovative high-tech industries and I like that
a lot. But he also overpromises a lot, e.g. coast-to-coast tesla autopilot
(probably not happening anytime soon) or something actually useful with the
neurochip (also years ahead). some of his remarks on AI also tells me that he
has a feeling that he knows everything about everything but that might not be
exactly the case. he is a smart guy and he got rich basically by having a
really good electronic payment system. but that does not make him a universal
engineer/scientist/philosopher.

~~~
gxon
“Shoot for the stars but if you happen to miss shoot for the moon instead.”

There's something to be said about the value of setting wildly unachievable
goals. It takes you further than you might have thought possible.

------
paulpan
Anyone else getting Theranos vibes? As others have stated here,
Hindenburgresearch is a known short-seller and so has an self interest to
drive down the stock price of Nikola.

Also it was only yesterday that GM announced taking an 11% in the company for
$2B. Surely GM has done their due diligence before throwing a couple of
billions in? [https://www.cnn.com/2020/09/08/business/nikola-gm-badger-
ele...](https://www.cnn.com/2020/09/08/business/nikola-gm-badger-electric-
vehicles/index.html)

That all said, everyone also thought Theranos was legitimate until they were
exposed to be not.

~~~
yangchi
I think you read the $2B upside down. Nikola paid GM $2B worth of stocks (11%
of the company) to have GM manufacture its vehicles, not the other way around

~~~
paulpan
You're right I misread it - Nikola is paying GM. Sounds like a no-brainer for
GM to accept.

~~~
stu2b50
Worst case, and let's be honest, modal case, Nikola goes under and GM has tech
and parts that they can just use on their own anyway in their electric
vehicles.

~~~
dawg-
Even better for GM, they just acquire the whole thing and now they have a new
brand to make their EV's under. GM could make a Chevy Volt 2x better than any
Tesla, but Tesla will still sell better because of the brand identity. If you
look at it like a branding/marketing deal then it makes a lot more sense from
GM's perspective.

~~~
leesec
>GM could make a Chevy Volt 2x better than any Tesla

As someone who worked in automotive tech in Detroit. This isn't even close to
true.

~~~
dawg-
Sorry for the vague wording. I meant "could" not as a statement of their
actual ability, but as a hypothetical. If they did make such a car, Tesla
would still sell better because of the brand. The current public narrative
says that Tesla is cutting edge and futuristic, and Chevy is old school.
Tesla's brand evokes images of cars as smart as their drivers, and Chevy
evokes muscle cars and old pickup trucks. EV sales will reflect that
regardless of how their cars actually compare to one another.

~~~
leesec
If Chevy made something better than a Tesla for a similar price or cheaper
then people would buy it. But they can't.

~~~
quaa55
and unfortunately they don't really want to.

------
clomond
And the thread of the sweater gets pulled...

While not shocking given the previous track record of Trevor's previous
enterprises - the most likely outcome here is that it will get very, very
ugly. He also already 'cashed out' millions of dollars to buy a 32.5 million
dollar ranch - one of the largest residential properties in Utah's history.
[1]

Tesla's run up and general optimism around EVs seems to have triggered a gold
rush of sorts, effecting other EV pureplays' stock prices (ex. NIO) regardless
of progress and actual state of the technology.

While in theory I am in strong support of new financing models to bring new
technologies to market(ex. these Special Purpose Acquisition Companies -
SPACs) I am very concerned that if even a portion of the alleged is true, this
could poison this financing route for legitimate businesses and the sector
overall. A camp in the investment industry even think Tesla is a fraud, and
this would only harm the narrative and long term mission of Tesla.

It would have been great if they actually took the money, utilized it with a
plan and executed on the plan to help with electrification - the premise for
which I think many retail investors have become involved.

Even if there was no fraud, I was always skeptical of their plan (smelled like
vaporware to me) and their adamance about hydrogen as an energy storage medium
without sufficient discussion on electrolyzer technology or how those unit
economics work always struck me as big red flags. Seems like Nikola's plan was
to combine a bunch of off the shelf parts existing from other sources into a
product, in that case - where is the technology? So much of it with just the
bit of digging and what I hear about it has made me skeptical.

Probably best to stay as far away as possible and see where the chips fall. I
do wish them the best though, assuming there was no fraud.

[1] [https://www.latimes.com/business/real-
estate/story/2019-11-1...](https://www.latimes.com/business/real-
estate/story/2019-11-14/nikola-motor-head-trevor-milton-2000-acre-utah-ranch)

~~~
dylan604
>A camp in the investment industry even think Tesla is a fraud,

At this point in Tesla's history, how is it a fraud? It is manufacturing and
selling cars. It is building batteries. I can see where some may think it is
not living up to the hype/promise of returns, but they are actually making and
selling product. Yet people are still claiming fraud?

~~~
wgerard
I think this is a fundamental misunderstanding of what short sellers do (which
is where most of the "fraud" accusation comes from). Some short sellers DO
claim fraudulent behavior, e.g. Enron was famously predicted to be fraudulent
by Jim Chanos.

However short selling at its core just involves the belief that a company is
overvalued. In the case of extreme fraud, the "correct value" is $0. In most
cases, the short seller just believes it's some amount less than the current
share price (but above $0).

Tesla falls into the latter category. I'm sure some do claim fraudulent
behavior, but Tesla is an interesting case because Tesla's PE is ~200 IIRC,
compared to the 20 average for the automotive industry. For comparison,
Amazon's PE is 120.

So if you think Tesla is ultimately a car company, or even just a "regular"
tech company, it's not insane to think that it's incredibly overvalued. That
doesn't mean you think it's a _fraud_ , of course, but the subtlety obviously
gets lost by many (and short sellers often make grandiose edicts that don't
help their case).

~~~
quickthrowman
> Tesla's PE is ~200 IIRC

TSLAs PE is 896 as of market close today (371.74/.4140) and had a PE of ~1213
at its ATH price of 502.49/share

~~~
switch11
thank you for putting up this correction

There is literally no company on the planet that can justify a 896 PE

Let's see how long Tesla can keep things going with 1,000 PEs

They are projected (based on stock valuation) to take over all or most of

cars energy solar power

Which is quite an absurd assumption

~~~
reducesuffering
Plenty of companies have justified negative P/E, which is worse than 896, and
still worse than even 10,000. In fact, their share price kept going up all the
way until their P/E was strongly positive.

------
tempsy
This interview from April 2019 was the thing that convinced me he was a fraud.
[https://www.truckinginfo.com/330475/whats-behind-the-
grille-...](https://www.truckinginfo.com/330475/whats-behind-the-grille-of-
the-new-nikola-hydrogen-electric-truck)

This gem right here:

> "The entire infotainment system is a HTML 5 super computer," Milton said.
> "That's the standard language for computer programmers around the world, so
> using it let's us build our own chips. And HTML 5 is very secure. Every
> component is linked on the data network, all speaking the same language.
> It's not a bunch of separate systems that somehow still manage to
> communicate."

This guy does not know what HTML is. What he has described is not what HTML
would be used for.

And I'm supposed to believe he's some sort of mastermind behind some new age
hydrogen/electric truck?

~~~
jamsiedaly
The bigger issue here is that this man was able to convince "industry
veterans" to give him massive amounts of money. You can see through him in a
heart beat because you're technically savvy. Clearly the people running these
automakers are not.

~~~
mikeryan
Seriously just watch any of the guys rants on YouTube, you don't have to be
technically savvy to see through his bullshit. Watch any of his interviews on
YouTube. I like this one with Jim Cramer trying to nail him down on his pre-
sales number on the Badger and laughing at him later

[https://youtu.be/OPhN8saJkAI?t=377](https://youtu.be/OPhN8saJkAI?t=377)

~~~
adventured
Amazingly tall pile of crap that guy is spewing. In the video he's touting
their lack of product / development focus as a virtue and claiming that they
can work on four or five projects (vehicles) more efficiently than one,
despite having no viable vehicles. Maybe we should consider his premise:
Nikola can fail to build four or five vehicles as well as they can fail to
build one.

------
ctvo
I find the audacity of the fraud hilarious.

They pulled a truck up a hill and let it roll down unpowered, using it in a
video demonstrating their new EV technology when nothing worked. Who does
that.

~~~
prdonahue
Startups do this. All the time. But they're typically software not hardware
demos so much easier to fake.

~~~
foolfoolz
this sounds equivalent to recording your demo of your website to play during a
conference because you aren’t sure it’s gonna work on stage. done that plenty
of times

~~~
ashtonkem
There is a pretty big gap between “it might crash so I have a backup” and “it
has never worked so let’s fake it”.

~~~
foolfoolz
not from a customers perspective

------
patentatt
Am I the only one who reads these stories of high level fraud (this one and
Theranos) and think: “why not me?” I’d like to say I have higher ethical
standards, but these conmen have cashed out a loooot of money doing this, and
I think my ethics would also get flexible as dollar amounts get into the 8 or
9-figures. But then I realize, this type of a person has been doing this their
whole life. This guy bilked his partner out of $50k in selling a $300k
business. I just wouldn’t think it’s worth the hassle to lie through my teeth
to everyone around me for $50k. That’s the difference between us and them, I
guess, it’s the small-time fraud you have to slog through to make it to the
big-leagues of scams.

~~~
marvin
You'll risk jail. And never having an honest job again. And having to hang out
with the sort of people who enjoy the company of con artists. And lying
through your teeth all day. And actively spending your creative energies
making the world worse. And deliberately stealing money from people who might
have used it for something useful. And gaining the lifetime hatred of these
people. Who will want to punish you personally, financially or even commit
acts of violence against you.

If you've really thought through it and still figure it's a good idea, I'd
honestly like to stay as far away from you as possible. Because I'm pretty
sure that would represent a judgement that's at best very unsound, and in the
more likely case indicates a personality that's dangerous to their
surroundings.

~~~
patentatt
Fully agreed.

------
avolcano
"Hindenburg Research" is already an excellent name for a short seller, but in
this case, they are short selling a company creating cars powered by _hydrogen
fuel cells_. 2020 continues to be an incredibly on-the-nose year.

------
ahupp
> Initial Disclosure: After extensive research, we have taken a short position
> in shares of Nikola Corp.

This is a great example of why shorts are socially valuable. Without that
incentive who would go to the trouble of doing all this research to uncover
(possible) fraud? This topic that comes up a lot on Money Stuff, where its
easier for private companies to hide misbehavior because you can only short
the public ones.

~~~
santoshalper
Short sellers, especially public ones, have a critical role in our equity
markets. They remind me of defense attorneys. It's a sometimes thankless job
and nobody likes you for being too good at it, but it is absolutely vital to
keep the system healthy. Kudos to these guys for doing the fucking work.

~~~
phist_mcgee
I liked the bit where someone rented a car out in the middle of the desert and
rolled it down a low grade hill for several miles to prove the truck demo was
unpowered.

------
SigmundA
I have been watching Nikola for years wondering why anyone believes its BS, I
didn't realize the deception was this blatant and deep, I guess like many I
didn't do real due diligence, but I didn't invest millions in the company
either.

Very sad and disheartening to see it continue and get further investment, just
make me think that telling the truth does't pay, selling lies does, fake it
till you make it taken to the extreme, similar to Tharanos.

The over promise under deliver approach Musk uses annoy's me but there is
something real there, real results, Nikloa is literally riding on a play of a
name of another company. At least Musk recognizes the issues with Hydrogen and
he obviously has a grasp of the technical issues:

[https://www.youtube.com/watch?v=yFPnT-
DCBVs](https://www.youtube.com/watch?v=yFPnT-DCBVs)

~~~
hinkley
It took me years and years to get a story that made sense about Corbin Motors
and why they flamed out making the Sparrow and trying to bring out the Merlin.

It will probably surprise nobody here that the Pareto Principle applies to
large scale manufacturing. Hand building a vehicle is 10% of the work, and the
other 90% is a very different kind of work and skillset that is easy to drown
in. A bunch of things you just figured out how to do well, you need to stop
doing entirely because a machine or a vendor should be doing them for you.
Along with all the people and equipment you acquired to do it.

You have to stomach writing off a bunch of equipment, swallowing your pride
and taking advice from people who have no sweat equity in your company. And as
a cherry on top, you probably get to be the asshole that has to fire John
Henry, who has been here since before the machines.

------
axiom92
From the link:

 _Nikola’s Director of Hydrogen Production /Infrastructure Is Trevor Milton’s
Little Brother, Who Worked Paving Driveways in Hawaii Prior To Joining at
Nikola_

 _Nikola’s Chief Engineer: A Background Largely in Software Development and
Pinball Machine Repair_

~~~
divbzero
The younger brother actually delivered value to customers by pouring concrete
and paving driveways, in contrast to Nikola’s record to date.

------
syspec
I was wondering, how on earth this company even came to be listed on NASDAQ,
since they have no products and no revenue.

So I looked it up and basically it looks like they acquired a company which
was ALREADY listed on NASDAQ then renamed it.

> In March 2020, Nikola announced its plans to merge with VectoIQ[10]
> Acquisition Corporation[11] (ticker VTIQ), a publicly traded special purpose
> acquisition company run by former General Motors Co. executive Steve Girsky.
> This resulted in the combined company being listed on the NASDAQ exchange
> with the NKLA ticker symbol.[12] Nikola’s stock began trading on June 4,
> 2020, a day after the merger was completed

\-
[https://en.wikipedia.org/wiki/Nikola_Corporation](https://en.wikipedia.org/wiki/Nikola_Corporation)

~~~
stu2b50
>So I looked it up and basically it looks like they acquired a company which
was ALREADY listed on NASDAQ then renamed it

Not just any company, a Spac. Special purpose acquisition company. That's
their purpose, they're not actually companies, but blank check investment
vehicles.

It's a way to go public without an IPO. And unlike reverse mergers with actual
companies spacs are clean since they're shell companies.

They're neither shady nor unusual, though.

~~~
glangdale
Reverse Takeovers (RTOs) are super-common in Australia. A lot of broken mining
companies whose exploration came up blank wind up sitting around still with a
symbol on the ASX. This is used as an easy way to list - although the
prognosis is not normally good (i.e. anyone evading the scrutiny of a listing
starts a bit behind the 8-ball). Given how expensive and complex listing is,
it's not the worst thing in the world.

------
foolfoolz
this is interesting. i worked for someone like this who was CEO of a YC backed
startup. everything was “in progress” but really hadn’t started. the stuff
that was “finished” was ongoing or never happened. it got to the point where
every line in a meeting about plans i had to question to find the real story.
you can get very far bullshitting your way

------
zaroth
I think it’s a bit funny how some discussion in this thread has veered into
denigrating Musk — who is at times one of the ten richest people in the entire
world, and who ships products that millions of people have bought or aspire to
purchasing, and who is predominately responsible for ushering in this entire
era of the electronic car.

Don’t forget that “Hindenburg Research” (seriously?!) stands to make many tens
or hundreds of millions of dollars based on whether they can convince a
significant number of shareholders that what they are claiming is true. And
also that if they are successful in doing so that it also becomes a self-
fulfilling prophecy.

I have no reason to believe or disbelieve any claims being made in TFA, so the
only thing I can say for sure is that that this “report” is in no way
altruistic.

One of the very precarious notions around short selling is the financial
incentive it provides to ruinously slander a company, and the very meager
legal protections a company has against defamatory claims that short sellers
make — in the name of “analysis” — against a company that they stand to make a
fortune from if it fails.

Without knowing anything one way or another about Nikola, the only thing I can
say for certain is that if Nikola misstates a material fact to investors they
can go to jail, whereas if “Hindenburg” gets their facts entirely wrong they
face no repercussions. They have no duty to the shareholders of Nikola stock,
and the legal peril of being even willfully wrong in their analysis is
minuscule compared to what Nikola officers could face from the SEC.

That’s just the grain of salt I would carefully consider before reading
anything that Hindenburg puts out.

~~~
dcow
Are you long on Nikola?

The group releasing the report stands to lose their position if their claims
are false or even if the market ignores them. I’d argue it’s a lot harder to
convince a bunch of people with long positions making the market that they
pumped the wrong company than it is for the makers to ignore the ruse long
enough to diversify the inevitable failure and pass it into your retirement
fund.

You don't just short companies for fun with no ramifications. I think you’re
painting an exaggerated picture of the nature of taking down a company. You
only attempt to do so if you are extremely sure of your convictions and have
overwhelming evidence to support your case. You make enemies and you risk
losing your connection to other market makers.

I came across Nikola last month and didn’t need a report like this to smell
something fishy. But this one is especially damning. I see no reason to not
believe the evidence in the report.

~~~
zaroth
Not long on Nikola, and like I said, I am not making any judgement on the
facts or evidence presented whatsoever.

But I was long Tesla during a similar period in their own existence, while
short sellers tried to make a similar case that Tesla was a fraud and certain
to go bankrupt any day.

There is always a strong reason to question a report when the authors have an
extremely vested interest in people believing it, and in fact when the
objective truth of whether they are right is less important than how many
people they can make believe that they are right.

~~~
marvin
You're making an underappreciated point: Activist short sellers can be capable
of torpedoing a company that would have been successful in their absence, if
the company's development depends on financing and goodwill.

It does present a bit of an ethical conundrum. Is it ethically correct to not
point out something you believe to be fraudulent?

It's certainly unethical to deliberately slander something you believe to be
viable, purposes of profit or not, but it can be hard to tell the difference
when judging any such initiative.

I could see the case for banning advocating a short position, reasoning in
terms of market manipuiation, but I don't think it's clear-cut. Was also a
very close observer to the Tesla shennanigans two years ago, and there were
some shameful tactics being used at the time.

------
jariel
The fraud is not interesting.

The fact that big companies and Big CEO's are stupid and incompetent is the
interesting thing.

Everyone who worked on this deal at GM should be fired along with the CEO.

I once worked at a 'Big Company' that thought about buying n Mp3 player.
Everyone loved their CEO, their pitch, the box, product looked slick.

We were going to buy it. I took it home and tried it and it was garbage.

Literally our M&A team, execs, due diligence and _nobody bothered to f_ __ing
try the dam product* and use a little bit of common sense to ascertain whether
it was 'quality' or not.

This was not fraud, and of a much smaller scale, but it's just incredible how
big the 'blind spot' so many executives have.

Edit: I said executives were 'stupid' they generally are not. They just have
gaping holes in their abilities, that enough ego doesn't allow them to even
see themselves. It's understandable they don't want to look weak, but insane
that they don't do background/deep checks.

If I were a CEO I would include 'product & IP validation' right up front as
part of due diligence - not just by 'accredited people' (because you can't get
a 'CA' in tech) but by people you trust.

Edit 2:

"Trevor has appointed his brother, Travis, as “Director of Hydrogen
Production/Infrastructure” to oversee this critical part of the business.
Travis’s prior experience looks to have largely consisted of pouring concrete
driveways and doing subcontractor work on home renovations in Hawaii."

Oh please make this into a Tiger King Netflix special ...

~~~
pwillia7
Maybe we'll get a Good Will Hunting version. Concrete pourer solves what
billions of dollars and academics could not for years. I would watch it.

------
hn_throwaway_99
Totally reminds me of Theranos. "Charismatic" (I put that in quotes because
they're only charismatic to a certain group of people, I think the more
"mechanical" thinkers like myself view them about as charismatic as a used-car
salesman) founder who the industry touts as "the next Jobs/Musk" excels at
sounding like a ton of bullshit but is able to convince well-heeled investors
to pony up a lot of money due to FOMO.

~~~
defterGoose
"Huckster" is the word you're groping for, I think.

------
dzdt
Does anyone have a contrary spurce of positive evidence that Nikola honestly
does have valuable working technology? I have not made any effort to dig, but
what little I had seen of Nikola so far seemed more hype than substance so the
accusations here seem pretty believable.

~~~
pmorici
The most charitable thing I've seen is some of the videos that came from when
Trevor invited several popular Tesla oriented YouTube and Twitter
personalities to Nikola HQ for a day long tour and Q&A. Sean Mitchell in
particular has a pretty even handed take.

[0]
[https://www.youtube.com/watch?v=L6R5PuEl028](https://www.youtube.com/watch?v=L6R5PuEl028)

[1]
[https://www.youtube.com/watch?v=9arSTJLsa_8](https://www.youtube.com/watch?v=9arSTJLsa_8)

------
shajznnckfke
I’m not big on trading individual stocks, but I own a bunch of long puts on
Nikola. I don’t know any other company that seems as likely to go to zero
(other than companies like Hertz, where everyone knows so the options are
priced appropriately).

~~~
toomuchtodo
Be careful with those puts. It’s entirely possible to be right and still not
be able to close out your position because the underlying is halted/delisted.

~~~
rohitb91
The market can stay irrational longer than you can stay solvent

I think the flood of retail investors with disposable income and government
benefits is leading to absurdities in market pricing. See: Hertz skyrocketing
after announcing bankruptcies.

After all, the stock has dropped 90%, how much lower can it go right?

Well, to the new investors, all the way to 0.

~~~
URSpider94
This is not even that. The parent is talking about the case where the stock
does indeed go to zero and get de-listed from the exchange, in other words the
market becomes rational. At that point, you're holding put options that are
ridiculously in-the-money, but you can't execute or sell them to take your
profit because the underlying stock is gone. So, your highly valuable stash of
Nikola puts becomes worthless ...

~~~
mdorazio
Someone correct me if I'm wrong, but I'm pretty sure that's not how it works.
If it gets delisted, you would buy the pinks to get the shares. The stock
doesn't just disappear when it's delisted.

------
ChuckMcM
The sad part for me is that this reads like a profile of a "successful, new
age, startup entrepreneur" relying on the 'fake it till you make it' mantra
betting other people's money on the outside chance they can figure out how to
do what they claim they already do before everyone else catches on.

I would have expected that GM's due diligence team would uncover this sort of
stuff prior to taking an 11% position in the company.

Which proves to me, once again, that the way to get rich is to defraud people
with a lot of money, and not a lot of insight.

~~~
kjksf
In fairness, GM got $2 billion worth of Nikolai stock for future vague work.

The work they are supposed to be doing for Nikolai is the same work they'll be
doing for their own EV trucks (that they'll have to have at some point) so you
can look at it as GM being paid by Nikolai for R&D.

I would still not do this deal if I was GM.

The probability of Nikolai bursting in the flames of disgrace and litigation
before they'll pay GM for anything is 99%.

GM can only sell 30% of stock after a 1 year (and additional 30% each year
after) so by the time they can cash in, it'll likely be worthless.

And Mary Barra will have to explain how she got taken by an obvious fraud. It
might end up costing her a job.

------
thrill
Hindenburg Research is a well known short seller.

~~~
beamatronic
That’s an awfully tasteless choice of a name then. They are looking for
companies that are going to catch on fire, crash and burn?

~~~
perl4ever
As is sometimes noted, the Hindenburg is known as a gigantic disaster, but
only a little over a third of the people on it died, which is probably better
than you usually get from an airplane that explodes in a fireball at 600 feet.

So maybe they are looking for companies that are going to have extreme PR
disasters, regardless of actual consequences.

~~~
liability
The Hindenburg wasn't even the deadliest airship disaster. 36 died in the
Hindenberg fire while 52 died on the Dixmude, 48 on R101, and 73 on the USS
Akron (three survivors.)

I think the Hindenburg is the best known because it was captured on film and
broadcast radio, and was also the last.

------
baltimore
Why do I cringe when I see "at a high rate of speed" where "at high speed"
should be?

~~~
sneak
Same reason I cringe when people use “as per” where a single “as” or “per”
will do (per means as), “thusly” instead of “thus”, and, my personal anti-
favorite, “individual” to mean “person”.

It’s a special kind of pretentious language that people use to make them seem
more authoritative or accurate/deliberate. It’s manipulative.

~~~
sokoloff
For me "leverage" instead of "use" is like nails on a chalkboard.

~~~
dnautics
\- usage instead of "use" (they _are_ different words)

\- quantify/fication instead of "measure/ment"

\- problematic instead of "a problem"

\- such that instead of "that" (the correct usage is as a phrase that comes
from math proofs, "pick an x such that y")

~~~
sneak
> _problematic instead of "a problem"_

I think this one comes out of a fear of or desire to avoid confrontational
language in general in the US. Something can be called problematic without
declaring “a problem exists”.

What, you got a problem?! :)

------
evo_9
Reminds me of Magic Leap but even their bullshit wasn’t this thick. At least
they shipped something I guess.

------
dugditches
>On the morning of September 8, 2020, Nikola announced a strategic
manufacturing partnership with General Motors, sending shares of both
companies sharply higher.

Interesting that GM seems to be making a lot of moves at once.

[https://www.cnbc.com/2020/09/03/gm-and-honda-to-estabish-
str...](https://www.cnbc.com/2020/09/03/gm-and-honda-to-estabish-strategic-
alliance-in-north-america.html)

------
dba7dba
I know Hyundai Motor started shipping production model of fuel-cell truck in
July 2020. They are planning to ship 1,600 hydrogen-powered Xcient trucks to
customers by 2025.

[https://www.autoblog.com/2020/07/08/hyundai-xcient-fuel-
cell...](https://www.autoblog.com/2020/07/08/hyundai-xcient-fuel-cell-semi-
truck-hydrogen-electric-europe/)

And then I ran into this article. [https://www.autoblog.com/2020/08/13/nikola-
hyundai-hydrogen-...](https://www.autoblog.com/2020/08/13/nikola-hyundai-
hydrogen-partnership/)

Trevor Milton, founder of Nikola Corp, said he would like to cooperate with
Hyundai. He said he had twice made proposals to Hyundai that were rejected.

------
wyxuan
They said that they would release a report on a well known company but this is
a little disappointing. I think everyone knew that Nikola was pretty shady to
begin with. After all, it’s not everyday when the company sells merch that
revolves around their trading symbol

------
vsskanth
So it seems GM didn't really give any money to Nikola ? The article mentions
they get 2 billion equivalent in stocks for non-cash contributions and 700
million in reimbursements from Nikola.

------
WheelsAtLarge
Nikola seems to be little more than an idea but this report won't sink their
ship. The reality is that the world is looking for the replacement for our
carbon based energy system. Even if he just comes close to making a dent he
and the people around him will be well rewarded. Everything starts with a
dream, he seems to be a bit farther along than that. I won't invest but the
car companies should at least help him make his dream come true. It will
benefit all of us.

------
hinkley
I searched my heart for sympathy, and all I found was this bucket of crocodile
tears.

Someone sold GM on a fraudulent electric vehicle future? Let's ask some former
EV1 owners how that feels.

------
throwawaysea
For those who have read “Bad Blood”, which details the fraud and unethical
practices behind Theranos, this deeply comprehensive account of Nikola feels
like deja Vu. I wonder if the same power dynamics are in play here as well,
making the truth hard to recover from those close to it while an incompetent
news industry continues primarily writing positive headlines that enable the
fraud.

------
m3kw9
Check this one: “ elaborate ruse—Nikola had the truck towed to the top of a
hill on a remote stretch of road and simply filmed it rolling down the hill.”

------
swyx
nikola stock only down 11% today, market cap 14bn. is this report credible at
all? why is the market not taking this more seriously?

~~~
nickik
Because Nikola has been excellent at selling their story to a broad set of
people using social media and youtube. And many of these don't follow reports
like this, plus the anti-short backlash from the hardcore fans and investors
is strong with reports like this.

They are 'the next Tesla' but 'better' because they use 'hydrogen'. And every
'blogboy' knows that hydrogen is the real technology of the future. So when a
untypical CEO from a Tesla like company makes big claims and has amazing
presentation and videos to back it up, many buy it.

Nikola did clever things like suing Tesla over their truck design, to get
massive exposure threw the Tesla hype machine with the moto bad publicity is
publicity. They consistently try to get into all the Tesla and EV influences
and made it a point of trying to get them onboard. Trever Milon often
competing on Tesla, comparing themselves to Tesla and so on.

He literally says things like 'There are few people who can out-Elon Elon but
I'm one of them'. That sort of talk sells well.

Nikola for 4 years consistently trying to insert itself into the conversation
and that has really payed of for them. They have never done anything but get
mentioned right along companies established car makers. In reality Nikola is
far less of a company then Rivian, but much better known.

------
simonebrunozzi
> Trevor has appointed his brother, Travis, as “Director of Hydrogen
> Production/Infrastructure” to oversee this critical part of the business.
> Travis’s prior experience looks to have largely consisted of pouring
> concrete driveways and doing subcontractor work on home renovations in
> Hawaii.

This might be one of the best parts.

------
solarengineer
What of this article at cnet, where they show a working truck used by
Budweiser in 2019?

[https://www.cnet.com/roadshow/news/budweiser-beer-nikola-
hyd...](https://www.cnet.com/roadshow/news/budweiser-beer-nikola-hydrogen-
electric-semi-truck/)

------
nickik
I totally agree here. Following this space for a long time, Nikola has always
been by far the shadiest of all these companies.

They were one of the very few companies that claimed revolutionary battery
technology. This is an instant red flag and a huge one. New revolutionary
batteries don't just just happen.

Sila Nanotechnology, is only replacing anode materials, and they have been at
it since 2012 and don't expect to be in cars until 2025. Quantum Scape, who
want to make Solid State Li Anode batteries is not gone be in cars until 2025.

There were a number of other companies who also did this 'we have
revolutionary batteries'. Some actually believed they did. Dyson is a good
example, they wanted to create a car, and to achieve their targets, they
invested lots of money including in batteries. However since they are a honest
company they eventually admired that they couldn't hit their engineering
targets and abandoned the project.

A Nikola competitor in the arena of bullshit spinning is Henry Fisker. His
first company made lots of nonsense claims, including about batteries, but
unlike Nikola they actually went threw the trouble and made some investment in
future battery tech, just not credibly commercial ones. They went bankrupt.
His new company is right back to the old bullshit spinning way but they have
lower their ambitions and just open say they want to buy the VM MEB platform,
now they are gone be the most 'sustainable' among other claims.

As a comparison, Tesla 'revolutionary' technology at battery day will likely
not be a silicon anode or a lithium anode, those are simply not ready for
commercial use. Revolutionary battery technology would be 10-20% energy
density improvment and 30-50% longer lifetime maybe 2x faster production
speed, and Tesla has been working on this for 5-10 years and have spent many
100s of millions acquiring a set of companies and having research agreement
with multiple universities that all work in collaboration. In total I would
guess to really bring a new cell to market at scale, you are talking 5-15
years and 5 billion $, and that is still with basically conventional cell
chemistry.

Much of the same can be said about Fuel Cells. Toyota, Honda and also the
Koreans have been banging their head against the fuel cell wall for 30 years,
with heaps of government money to back them up. They know they can't make it
work, even with their massive resources. In personal vehicles they are not
competitive against EVs in the slights (while also not being an improvement in
CO2 compared to Gas) while in trucks they are not competitive with Disel or
Natural Gas, and soon electric trucks are gone take the majority of routes
over as nobody can compete with their price on these short and mid distant
routes.

But Nikola are gone make it, and not for a geographically small place like
Japan, but for the gigantic US without much government support either.

Another topic is that of product announcements. If you follow Nikola for many
years, or you go back to 2016 and look at their announcements there is a funny
effect that happens. People can say about Elon Time what they like, but mostly
the products actually do come out and often are improved over the original
announcement in a number of ways. Nikola shows the exact opposite pattern. It
goes something like this, announce revolutionary new product but its 3-5 years
out. Then progressively lower the specs over time, while pushing the time to
market out further.

The hype for anything EV related has been insane. Quantum Scape is a fine
company for example, but they have valuation that is insane for a company that
is not gone make real money for many years and not gone make profits for many
more after that. They essentially have a technology that requires a totally
new manufacturing system, while competitors like Sila can put their materials
in existing facilities claim the same level of improvements. I wouldn't expose
myself to a unique technology with so much competition

There are tons of EV startups and they differ widely from Lucid, Rivian being
serious companies step by step putting in place a solid car company. Dynamic
companies like NIO coming out of China. And there are the bottom feeders like
Nikola, Fisker and others that surf on the hype.

This is gone be a massive market shakeout with Tesla being the leader hunted
by everybody. Slow moving giants like VW, Toyota and so on finally realizing
whats happening and taking methodical step after step. And a massive wave of
startups from around the world, especially China trying to be next next big
thing. Its gone be interesting to say the least.

------
jdhn
It's my opinion that GM felt forced to enter into this partnership with Nikola
because Ford was able to get into bed with Rivian when GM pulled out of that
deal. For GM's sake, I hope that these guys are completely wrong.

~~~
stu2b50
GM will be fine if they go under. Nikola is paying for them to develop and
manufacture parts of their "car" with 2 billion in stock.

If Nikola goes under... GM hasn't lost anything. They can take all the work
they did and just use it for their EVs.

~~~
jdhn
It's more of a reputation hit than anything. If this turns out to be as bad as
these short sellers are saying, then anybody who really associated with Nikola
is going to look really bad in the eyes of consumers.

~~~
fakedang
I don't think the top level honchos at GM are smart enough to have thought
even this far through as you have.

------
leesec
Bigger shocker here. I hope Rivian doesn't follow the same path, but I can't
seem to find any real videos of their truck doing what they've been saying
it's capable of either.

~~~
evo_9
Hmm... didn't take all that much effort:
[https://electrek.co/2020/06/25/rivian-r1t-electric-pickup-
st...](https://electrek.co/2020/06/25/rivian-r1t-electric-pickup-stress-
tested-desert-video/)

~~~
leesec
Where in that video does the truck go from 0-60 in 3 seconds, travel 400+
miles on a charge, charge in a reasonable time frame, etc...?

This is a marketing video. For all we know that truck could have an engine.
I'm talking about a real actual video of the truck doing what it's been
proclaimed to do. It's been a few years, it shouldn't be so hard to have a
single video of a truck getting close to these targets.

------
aurizon
Now GM has the unenviable task of picking up this turd by the clean end.....

~~~
stu2b50
Why? Their deal involves 2 billion in equity from Nikola for non-cash
manufacturing work and development from GM.

~~~
aurizon
GM was snookered. I doubt that Nikola has IP worth that much work

~~~
stu2b50
Not really. From a financial pov GM wins hard no matter what happens. Nikola
somehow becomes a real company:

GM gets 2 billion in stock + 700 million in cash reimbursements and a
strategic partnership. Nikola implodes, then GM still gets whatever of the
700M they could file and all the work they did is directly useful and
necessary for their own EV projects. They're basically getting paid to do
their own R&D

The hit is to their reputation.

Nikola basically paid GM to "partner" with them in a lopsided deal so they
could have more credibility.

~~~
aurizon
Yes, I can see that is a valid POV, Nicola does indeed need validation like
this.

------
codeisawesome
How do we tell that this research has 'teeth'? Sounds super juicy if true!
Would there be a 'ticket number' of some kind for an SEC complaint that
Hindenburg filed?

------
m1117
This thread went to the second page of hacker news in 4 hours, while the
amount of upvotes beats anything on the front page. Looks like throttling.

------
galkk
Holy shit. I'd be staging my fake death already.

------
yaacovtp
Why were tweets deleted all the way back to June?

------
Animats
Now we understand how GM paid a billion dollars for Cruise when all they had
was a road-follower, something GM already had.

------
yalogin
One look at their site tells you it’s a fraud. They have nothing. Simply
riding on the current fad.

------
Whut
I really look forward to reading the book about the inevitable meltdown.

------
new_realist
Tesla is 17 years old; Nikola is far less advanced.

Elon Musk fanboys are jealous that Trevor Milton is doing it better, faster.

------
m1117
So theranos!

------
dzonga
would a black dude been able to pull of a straight eye | face fraud like this
?

~~~
coolspot
Are you saying that some races are less honest than other?

Also direct answer to your question:
[https://money.cnn.com/2012/04/12/markets/ponzi-
scheme/index....](https://money.cnn.com/2012/04/12/markets/ponzi-
scheme/index.htm)

[https://restofworld.org/2020/how-a-forbes-cover-star-
stole-m...](https://restofworld.org/2020/how-a-forbes-cover-star-stole-
millions/)

[https://www.timeslive.co.za/news/south-
africa/2020-09-07-for...](https://www.timeslive.co.za/news/south-
africa/2020-09-07-for-the-love-of-fraud-now-us-is-also-to-indict-conman-
pastor-jali/)

------
extremeMath
Worse GM may be a zombie company.

Your taxes will always be supporting their business.

------
mberning
Reminds me of the GE hit piece appearing on gefraud.com that tanked the stock
and is now nowhere to be seen. Nor is the guy that authored it. I’m sure they
made out like a bandit on their options.

------
Ecstatify
There seems to be such negativity surrounding electric vehicles in the media.
I wonder if there’s a vested interest deliberately trying to create this
narrative. Electric vehicles are definitely the future.

~~~
outworlder
EVs are the future.

Hydrogen powered ones? Most likely not, unless the fossil fuel industry
manages to convince everyone they are still needed.

~~~
Hypx
FCEVs are the future. BEVs are a temporary stopgap.

------
thedudeabides5
Well this is a first, top of HN with no comments.

I'll say it, I have no idea of validity of any of these statements, need to go
read. But do remember getting weird stock pump and dump emails about this
company a long time ago and it always put a bad taste in my mouth.

