Less than two weeks after signing a $ 2 billion deal with General Motors, the founder of electric vehicle startup Nikola Corp. back for lying repeatedly about the company’s technology.
The resignation of Trevor Milton as Executive Chairman, announced Late Sunday came after the Hindenburg Research mutual fund report He accused him of making numerous false claims about Nikola’s technology, including the one-time production of a video of a truck being rolled down an incline to make it look like the company had developed a working prototype.
Hindenburg, a short-selling company that said it wanted to profit from a bet on the price of Nikola stock, called Nikola “an intricate scam.” His report appeared just days after the company and G.M. agreed to collaborate on the production of battery powered pickups and hydrogen powered heavy trucks.
Nikola from Phoenix called Hindenburg’s allegations “false and defamatoryAnd said it would file a complaint with the Securities and Exchange Commission. Nikola shares, which after the deal with G.M. jumped, lost 40 percent of their value according to the Hindenburg report. On Monday morning, following the announcement of Mr. Milton’s resignation, shares in premarket trading fell another 23 percent.
Mr. Milton said in a statement that “the focus should be on the company and its world changing mission, not me. That is why I made the difficult decision to turn to the board of directors and volunteer to stand aside. “
Stephen Girsky, former vice chairman of G.M. and a board member from Nikola will chair.
While denying Hindenburg’s accusations, Nikola Hindenburg admitted that a 2017 prototype truck featured in a promotional video was not self-powered. “Nikola never stated in the video that his truck was driving under its own drive,” the company said in a statement. Nikola said it has built fully functional models since then.
G.M. said this month it would build pickups for Nikola and provide battery pack technology in exchange for an 11 percent stake in the company valued at $ 2 billion.