The history of discrepancies in the history of Nicola has been in plain sight.

(Bloomberg) – Nicola Corp has left a trail of inconsistent statements and contradictory announcements that are now coming under scrutiny from short sellers eager to make a hole in the electric vehicle company’s success story.

Hindenburg Research, which holds a small position in Nicola stock and stands to gain if the stock collapses, released a report on Thursday stating “dozens of lies” about the company’s capabilities, partnerships or products. The firm used internal email, analyzed the photos and even sent an investigator to rural Utah to test how far a car would go up the hill. Nicola said Hindenburg’s report was full of lies, but did not offer anything specific to refute the allegations.

It does not take a hedge fund or a private eye to determine whether Nicola, which partnered with General Motors Company this week, has a pattern of discrepancies. A look at some of its announcements and filings, along with statements and tweets from executive chairman Trevor Milton and other management over the years, offer other examples that were not part of the Hindenburg report. “It’s a bit confusing trying to follow Trevor on his various social media outlets about the timing and timing of communication of various variables,” said Jeff Osborne, an analyst at COUN & Co, quoting an executive officer . ” 4 conference call.

Nicola shares have fallen 24% since the Hindenburg report, which, among other sources, cited a Bloomberg story from June that the company exaggerated the capabilities of a truck. Its slowdown was 36% in the last three sessions.

Chief Executive Officer Mark Russell, in response to a question asked by Bloomberg about the following items, said on Friday, “We are committed to doing our best to inform the investing public and all our stakeholders and to stay updated at all times . “

under construction

In a press event on July 22, ahead of the groundbreaking of Nicola’s Coolidge, Arizona, factory, Mark Duchesne, head of global manufacturing, posed a question as to when construction would take place. “That’s an easy answer,” he said. “Construction starts tomorrow.”

The timeline was repeated the next day by Milton in a tweet. But “construction” is a broad term.

To facilitate the groundbreaking ceremony, the city of Coolidge issued a temporary use permit to Nicola on 13 July. The document obtained by Bloomberg allowed the company to do some limited ground clearing and list a plan for coronavirus, along with preparations to hold the event. Security measures. This did not allow further construction to begin. The company obtained a Pinal County Dust Permit around the same time as a legal requirement in Arizona.

City Manager Rick Miller said that on August 7, the company received its risk grading and drainage permit. The permit allows Nicola to clean up the dirt and perform drainage work on site, but the company does not yet have the necessary permits for foundation work, plumbing, electrical or vertical construction, Miller said. Permits are available through public-records requests.

On Wednesday, Nicola said in a tweet that Coolidge’s city council had approved the company’s “factory masterplan” and that “construction can now proceed.” This is only partially true, Miller said. It was the Planning and Zoning Commission that approved the “major site plan”. The approval will allow Nicola and its architects and engineers to apply for the next batch of permits.

In a statement, Nicola said that “construction” meant everything from landslides to permits. Now that its building plan has been approved, “Various permits will be obtained along with the construction stages. We remain on time for Phase 1, ”the company said in an email.

“The factory will be ready in 12 months,” Milton said in a live broadcast on Instagram on Friday night. “The permit was issued by the city. We are all good to go. “

Puzzling partnership

Nicola has an ambition to manufacture hydrogen-powered fuel cell semi trucks by 2023. Since 2017, it has an agreement for German auto-parts supplier Robert Bosch GmbH to “develop, manufacture, test and support various components”, including the Protectas of Nicola. Fuel-cell systems, battery packs, steering pumps and motors, according to a regulatory filing in March.

The details of which partner has shifted over time in the project, and the future of the deal, are threatened.

According to the filing, Nicola agreed to pay Bosch $ 40 million for the development. In a presentation to investors in April, Nicola described the agreement with Bosch as a “co-development” and strategic supply chain partnership, and said the company would own any intellectual property jointly developed with Bosch.

However, Nicola officials have regularly stated that Nicola has designed, developed and developed a lot for its vehicles – not Bosch. On Friday, Chief Financial Officer Kim Brady said that Nikola will provide only 15% of its share in battery electric semi trucks, being manufactured in Ulm, Germany, while partner Evco provides the rest. However, he said that Nikola’s input accounts for 90% of the truck’s value.

“We are responsible for the Nikola trays – batteries, e-axles, e-motors, inverters, BMS systems, infotainment systems,” Brady said. “All major electric propulsion systems come from Nicola.”

As recently as August 25, Bosch has stated that it is “working with the company to build fuel-cell drives for trucks suitable for production.”

On Monday, Nicola announced that GM – not Bosch – would mass supply fuel cell systems for Nikola’s Class 7 and 8 semi trucks, as well as a battery pack for its first electric pickup, the Badger. On Friday, Nicola clarified that Bosch will supply semi-truck fuel cells in Europe, while GM will have exclusivity everywhere.

“Bosch is an investor, board member and supplier for Nicola. Nicola said that they help us in many aspects of our business.

Milton questioned a Twitter user’s claim that Nicola was slamming Bosch in favor of GM.

“As a company with a dedicated hydrogen strategy, Bosch welcomes GM’s decision to enter this market as a significant player,” Bosch spokesman Tim Weiland said in an email. “Beyond that, Nikola and Bosch have been working together for many years, not only on fuel cell power trains, but also on other innovations such as steering systems and mirror cam systems for the first prototype of Nikola trucks. Both companies will continue to collaborate on fuel cells in the future as well. “

game changer

Nicola’s narrative about her battery strategy also changed over time.

In November 2019, Nikola released a press release claiming to be “game-changing” battery cell technology that it will unveil at a ceremony in 2020. Nicola also said that it was “entered into a letter of intent to acquire world-class battery engineering” to help the team bring the new batteries into pre-production.

“We are talking about doubling the range of BEV and hydrogen-electric vehicles worldwide,” Milton said in the statement.

In July, Milton tweeted that Nicola “makes a complete pack like Buders” for his upcoming pickup truck, called the Badger. He said that all internal components, such as batteries, inverters, software and controls, are Nikola’s own intellectual property. “We do all this at home,” he said.

Milton clarified in a tweet Thursday that changing the direction of Nicola – using GM Ultium battery technology for the Badger – was the result of cost analysis and cost savings.

Beer truck

Back in March, Nicola said in a presentation to investors that he had a “signed binding agreement” with more than 800 hydrogen fuel cell electric semi trucks to provide Anheuser-Busch. What the presentation did not say was that Anheuser-Busch is committed to buying less trucks than that, and does not have to make any purchases.

The deal was first announced in May 2018 and stated that the trucks should be originally integrated into Anheuser-Busch’s dedicated fleet by the end of 2020, according to a press release.

This time is not nearing completion. During the August 4 earnings, Russell, CEO, updated investors on the deal, saying, “We are confident that we will be able to give them a test prototype before the end of 2021; Serial production or mass production of fuel cell trucks will not begin until 2023. “

This confirms with the timeline for production scheduled in a July filing – and to be fair, a lot of people have changed plans this year. But in a single filing, Nicola revealed that Anheuser-Busch retains the authority to cancel the truck order, although there is no indication of what will happen. The contract also has lease terms and rental rates that, according to the filing, may be difficult to meet for Nicola, “according to current design criteria and cost estimates, depending on our ability to develop our trucks and hydrogen network . “

The agreement between the two companies states that Eneuser-Busch prioritizes delivery for 20% of Nihola’s initial “production line of Class 8 vehicles”. To achieve production by 2023, Nicola must operate dedicated equipment in Annauser Büsch’s breweries and distribution centers by the end of 2021, according to the terms of the deal. Anheuser-Busch agreed to use only at least 600 trucks – the 800 figure is, according to the document, an estimate of what the brewery would need.

“They have been, and remain, a great long-term partner in our shared vision of a zero-emission future (the Nicola Two prototype drove our first load on public roads in St. Louis for them not too long ago).” Russell Said in a statement on Friday, referring to Anheuser-Busch. “Our original agreement with them has been modified over time. The terms of the current agreement are, as we determine in our earnings call. “

Anheuser-Busch did not respond to a request for comment. Anheuser-Busch said the partnership with Nicola would help the brewery convert its entire long-time fleet to zero-emission vehicles.

Prototype production

On 13 July, Milton stated that European partner Evco was already producing vehicle prototypes.

“We have a truck to produce right now with 720KwH, the largest battery to come anywhere in the world,” Milton said on TC’s Chartcast Podcast. “We are five of them coming from the assembly line in Ulm, Germany right now.”

On August 4, during the company’s first earnings call, Russell expressed sentiment, stating that the first five prototypes were “coming from the end of the facility at this point.”

According to two people familiar with the case, Ulm contained an incorrect description of Nikola and Evko’s progress. The assembly line is still under construction and not yet operational or building prototypes, people said. In one workshop people said that the prototype is being built by hand in a workshop.

As previously stated, the first five production prototypes of Nicole Tray are being completed by an assembly team at the Ulm facility. As stated earlier, the Nicola / IVECO JV large-scale production line facility in Ulm is still under construction, and is on track to begin regular serial production in 2021, ”Russell said on Friday. “We anticipate that many current IVECO personnel will join the Nikola / IVECO JV production team at Ulm.”

Nikola tweeted on 8 July in response to a question on a previous post about the tray’s battery pack, stating that 9 battery packs – 720 kWh – amounted to one truck. In pictures shared on Twitter by Milton on Friday, two images of the Nicola tray prototype being made in Germany had only 5 packs installed, or the equivalent of 400kWh.

Nicola said in response to Bloomberg News on Saturday that the prototype carries nine battery packs, and the system is designed to be judiciously integrated into the vehicle’s chassis. Photos shared by Milton on Friday showed “assembly work in progress”, it said in the email.

Guide Nicola

Here is when Nikola said that it would hit its major milestones based on filming, statements and interviews:

(Adds Nicola’s comment on the battery in the last two paragraphs.)

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