There's a reason short sellers exist — the world needs skeptics
/
taking off from the NYSE a bit earlier in the day than scheduled
Electric Truck Company Nikola Turns Out to Be As Badly Manipulated As Its Videos
Another EV pie-in-the-sky adventure declared bankruptcy today. This one, around the idea of manufacturing electric (and hydrogen) semi-trucks, was started by a guy named Trevor Milton and eventually got to be worth $30B before the floor fell out...or the battery drained.
Today was the day they pulled the life support for reals.
...At its peak in 2020, Nikola was valued more than Ford Motor at $30 billion, signed a multibillion-dollar deal with General Motors, and was considered the pinnacle of auto startups to go public through reverse mergers and special purpose acquisition companies.
Nikola released its first teaser video that year, and most of Wall Street and the world were bowled over by the visuals. The company proudly assured everyone it was a 'fully functioning vehicle, not just a pusher' or, in other words, it could run and didn't need to be shoved.
Pretty impressive, huh?
As I said, it was to almost everyone who watched it, except a guy who ran a hedge fund (Hindenburg Research) named Nathan Anderson, who noticed something hinky about the video.
It turns out that, technically, the company wasn't exactly lying - they hadn't 'pushed it' but they hadn't exactly said the truck in the video was 'running', either.
What Anderson discovered was that the company had towed the truck up an incline, turned it loose, and then let gravity take it back downhill in order to get the visual of the truck 'running' on the open highway.
Short seller Nathan Anderson, founder of Hindenburg Research, was one of the first to expose electric vehicle and energy company Nikola Corporation's deceptive 2020 promotional video, which showed its Nikola One truck rolling down a hill to simulate full functionality...
YOICKS
Milton's company didn't see it quite that way because, yo - they never said the truck was running. That's kind of your problem if you thought that's what they meant.
...One of the biggest allegations hurled against Nikola is that the company faked a glossy corporate video of its prototype trucks driving up an inclining highway. Short seller Hindenburg claimed that the truck was actually towed up a hill and didn't do it on its own merit. In response, the company asserted, “Nikola never stated its truck was driving under its own propulsion in the video.” Therefore, the company didn’t find it deceptive.
In mid-September 2020, the stock tanked, and Milton was forced out of the company under a cloud of accusations raining down.
Mr. Milton was sentenced to four years in a federal country club in December 2023 but will serve just 12 months and then be released to a halfway house, where he’ll have to stay for an additional six months. He stole billions; it’s a good thing he didn’t take a stroll through the Capitol while he was engaged in that thievery.
CHANGE: US Agency Reportedly Plans to Shut Down 8,000 EV Chargers, Offload EVs.
The General Services Administration (GSA), an agency that manages the federal government’s buildings, is planning to shut down all 8,000 of its electric vehicle chargers, The Verge reports.
The GSA is also expected to offload its current stock of EVs, though it’s unknown if the vehicles will be sold or put into storage. The agency will reportedly begin instructing employees to remove the chargers—which are used for both federally owned EVs and employees’ personal vehicles—as early as next week.
Just wait until the USPS dumps the electric fleet foisted on it by Congress. But while you’re waiting, there’s this story from August ‘23 to amuse and entertain you:
Proterra, Electric-Bus Maker Touted by President Biden, Goes Bankrupt
And then there’s the late EV School Bus Tsar Kamala’s project. How’s that going?
Several Maine school districts are still dealing with anxiety over underperforming electric school buses. For more on this story, visit: https://bit.ly/3Cn7lWL …
As it turns out, surprise! School districts throughout the country’s colder sections — you know, places that have winters — have discovered that electric buses’ batteries don’t go very far in cold weather, and are incapable of travelling the long routes in rural areas, so they’re sitting, useless, in fields and parking lots. If only anyone had pointed this out beforehand!
The real takeaway from this combination of reports is that some (most of?) Wall Street’s big swingers are as dumb and gullible as the general public.