Nikola Goes On The Defense After Claims Of ‘Fraud’

Just days after announcing a tie-up with General Motors to produce electric vehicles, Nikola (NKLA) has released a statement that defends itself against a "defamatory" report released by Hindenburg Research.

In the report, Hindenburg calls Nikola an “intricate fraud,” saying that its founder, Trevor Milton, allegedly lied to push the electric and hydrogen truck maker into the forefront of the EV market and has built a $20 billion public company on these claims.

Hindenburg said that Milton has “an undeniable track record of taking from others and claiming technology as his own. He has quietly used off-the-shelf products from third-parties while loudly claiming to have vast proprietary technology.”

The Sept. 10 report continued, stating, “Trevor would then leverage what he had and repeatedly mislead customers, partners, and investors in order to build his credibility and take his concept to the next level. This pattern of behavior continues to this day, now with billions of dollars on the line and with Nikola tied to some of the largest auto companies in the world.”

In a response posted Monday, Nikola called the report “false and defamatory.” The company added that the claims in the report were “designed to provide a false impression to investors and to negatively manipulate the market in order too financially benefit short sellers, including Hindenburg itself” and to “manipulate the market to profit from a manufactured decline in Nikola’s stock price.”

Despite the accusations made against them, the company said that it “remains laser-focused on laying the groundwork toward becoming the global leader in zero-emissions transportation.”

Nikola's clash with Hindenburg Research comes days after it announced its $2 billion partnership with GM for the Badger pickup truck. Under the partnership, GM will engineer, homologate, validate and manufacture the vehicle with production expected to start in 2022.

The truck maker made a splash earlier this year with the launch of the hydrogen-electric pickup truck. But at the time, the company only had renderings of the Badger, saying that it would be unveiled at its Nikola World event in December – an event where tickets needed to be purchased for entry. Nikola is currently taking preorders of the Badger Truck for $100.

Shares of Nikola were trading at $31.53 as of pre-market open on Monday, down 60 cents or 1.87%