Nikola shares nosedive after BP withdrew from the company’s hydrogen station deal. Yahoo Finance’s On The Move panel discuss.
JULIE HYMAN: All right, let’s take a look at Nikola as well today. Those shares are down about 3%, so falling once again today. The stock has really come under fire ever since that short seller’s report from Hindenburg Research, as well as what we’ve heard from the Securities and Exchange Commission. Then today there’s a report that talks that the company had been having with BP to build hydrogen refueling stations, those talks are now stalled. Dan, I guess it’s not surprising when the company is under such fire that some of its partners are going to at least hold off, if not cancel.
DAN HOWLEY: Woo! This is a fun story, yeah. This is just, oh my goodness, gracious. So I just, by the way, I want to point out that Nikola was supposed to be working on hydrogen powered trucks, and then the company that kind of set off this whole firestorm is called the Hindenburg Research group. So kind of fits their, sort of maybe kind of. But I think really, a lot of what’s going on now, and I’m surprised the stock is still where it’s at, it plummeted a good amount, but it’s not at zero yet.
It kind of seems like a lot of companies are hedging against the idea that Hindenburg is right in its investigations that Nikola doesn’t have any of its own proprietary technologies. What’s interesting is, if you look back at that GM deal, Nikola again, was supposed to be producing its own propulsion systems using hydropower, natural gas, EV, using batteries. But with that GM deal, they brought nothing to the table. It was GM providing all of that stuff. They were providing the propulsion systems, their own proprietary systems that was then going to go into this Badger truck.
And when that deal came out, the fact that there wasn’t so much scrutiny, it was more, oh, look, GM is getting into bed with this company that could rival Tesla. And it just so happens to ape the name by using Nikola Tesla’s first name rather than his last name. It just seems that there wasn’t enough scrutiny behind it at that point. And then, I mean, look, the Hindenburg Research, yes, they are a short seller, and yes, they have a short position against Nikola, but they did a lot of research on this, and point to a lot of interesting facts in here that I mean, it’s pretty damning when you look at it.
MELODY HAHM: And Dan, to that point, as much as it was comprehensive and robust research, why didn’t GM do that? And GM is claiming now and doubling down, saying that they did do their due diligence and this is a partnership that they’re going to continue pursuing. But I have a feeling that in the coming weeks, perhaps coming months, there will be some cold feet.
It’s impossible, Julie, to your earlier point, with these future partnerships that are already on cold ice, I don’t anticipate that this GM deal, however it may manifest, will end up coming to fruition in the way that both parties on Yahoo Finance’s programming sort of reported a couple of weeks ago. And I do want to point out, “Electrek” actually reporting this morning, saying that Tesla is now claiming Nikola stole its truck design from a Rimac designer, and they’re suing the company now for up to $2 billion in damages.
This is just pouring gasoline into the fire. I know we’re talking about EVs, but that’s the best analogy I could come up with right now. And just thinking about the ongoing struggles. Now it’s the time for other competitors, namely Tesla, to really double down on attacking Nikola while they’re down. It’s a very easy target and culprit at this point.
And then one last argument I want to bring up is, Trevor Milton, who sort of branded himself as the nicer version of the Elon Musk, the more palatable version, if you will, he also took to Twitter in the same way, sort of modeling after Elon Musk, responding directly to trolls. I do want to point out yesterday, as of yesterday, his Twitter handle, NikolaTrevor no longer exists. He doesn’t have that physical, the digital footprint online anymore. Although, of course, we know those tweets are archived and screenshotted everywhere on the internet.
But I do anticipate that these sorts of tweets will come back to bite him. And we know that Elon Musk had gotten in trouble for a lot of his sort of social media behavior. So it’s fascinating to me that Trevor Milton through this whole process, had been using the same sort of tactic that actually led Elon Musk into hot water in the first place.
DAN HOWLEY: Yeah, I think when you look at GM and how you mentioned that there’s going to be some kind of backlash, it really I think, just comes down to these companies trying to catch Tesla, trying to be that hot company that gets into the EV space. Look, they can’t sell EVs like Tesla can. They don’t have the cool factor, the sexiness factor. I mean, Elon Musk said some wild stuff on Twitter. He’s gotten in trouble for it. But his vision, it’s being executed at a level that the other old school automakers just can’t touch.