Nikola’s share price fell 16 percent on Friday as investors worried General Motors might decide to take a stake in the start of the truck.
Mark Russell, CEO, exacerbated the concerns Thursday, telling Bloomberg that the battled company had a “baseline plan” to move forward if GM walked away from a deal announced last month.
“That [markets are] reads into it like a hedge, ”said Dan Ives, an analyst at Wedbush Securities. “Right or wrong, now I think all eyes are focused on, will Nikola ink that act?”
Nikola, along with founder Trevor Milton, has been killed for several weeks by fraud allegations in a short-seller report released two days after GM said it would take an 1
While Nikola and GM have until December 3 to implement the agreement, talks between the two companies were expected to be completed by the end of September. Sir. Russell told the Financial Times that negotiations continued, but declined to comment further.
After the card seller’s allegations surfaced, the partnership between GM and Nikola has been the subject of speculation that the Detroit-based automaker may try to renegotiate the terms of the agreement or withdraw altogether.
Sir. Milton has denied any fraud and the company offered a rebuttal that admitted some points in the report. Sir. Milton left the company last month.
Since then, business leaders have been trying to shift the focus to Nikola’s business model: developing hydrogen cell semi-trucks together with a system of vehicle refueling stations.
In an interview with the Financial Times, Mr Russell called Badger “an interesting and exciting project for some shareholders, but our institutional shareholders are most focused on the business plan”.
Sir. Russell’s comments about Badger stood in contrast to his remarks to businessman John Shegerian for his Impact! podcast. The interview, released on September 15, appears to have been recorded on September 9 – a day after the GM announcement and a day before card seller Hindenburg Research published its report.
“We now believe we have been given a legitimate shot at being a significant manufacturer of battery-electric vehicles in the heavy truck space for commercial transport and now in the space for passenger cars with our pick-up truck, the Badger,” he said.
People “went crazy” over the badger after Mr. Milton tweeted about it, Mr. Russell added, and approx. 90,000 enthusiasts signed up to receive updates on the truck’s progress. Reservations to purchase the vehicle started at $ 100 and increased to $ 5,000 for VIP treatment.
“We think we can get you a badger in 2022,” he told the show’s host. “For $ 100, we’ll put you on the list.”