(Bloomberg) — Nikola Corp. wants to put allegations of deception behind it with a push to showcase its own innovations and detail how it plans to get its clean-powered trucks to market.
Executives at the embattled startup are talking to investors to rebut criticism it has no working prototypes and to clarify its business plans after the resignation of founder and former Chairman Trevor Milton. That effort includes highlighting technology with existing or pending patents, explaining the role partners will play and providing better milestones on efforts to start production.
“Our message is the same as it was before,” said Chief Executive Officer Mark Russell in an interview. “We have an ecosystem of partners that have validated what we’re doing. We believe we’re within three years of producing a fuel cell truck and one year of producing a battery-powered truck.”
Nikola executives will also use planned and direct communication to media and investors instead of the social media posts that Milton favored, according to people familiar with the company’s plans, who asked not to be identified.
The charm offensive is an attempt to counter investor skepticism about Nikola’s business model in the wake of a short-seller report last month that questioned the company’s capabilities and claims of progress. Nikola has denied misrepresenting itself, but federal regulators are reportedly examining the allegations against the company and Milton, who has been accused of unrelated harassment claims that he denies.
Shares of the company have fallen almost 50% from their price after going public in June through a reverse merger. The stock pared a decline of as much as 9.3% on Tuesday, trimming losses in early afternoon trading. The stock was down 6.2% to $18.10 as of 1:30 p.m. in New York.
Patents and Software
Nikola has forged technology-sharing relationships with automotive titans Robert Bosch GmbH and General Motors Co., both of which own stakes in the company. That helps underpin the company’s work — and potential value — as a systems integrator for its fast-track projects, including a battery-electric pickup truck and hydrogen fuel-cell semi trucks.
The Phoenix-based startup is also anxious to show investors in-house know-how, including six published patents in the U.S. for innovations such as a purpose-built frame for a fuel-cell truck. It also has several other U.S. patents pending for things like fuel-cell membranes and catalysts, hydrogen storage, fast fueling systems and system control technologies, according to a document seen by Bloomberg News.
While these patents represent future potential, they are many years away from commercialization, according to a person familiar with the matter. For the time being, Nikola will rely on Bosch’s fuel cells for prototypes to be built next year. GM’s fuel-cell technology is viewed by Nikola as more mature than Bosch’s, but it will take a longer time for the fuel cell’s packaging, compression and power management systems to be adjusted to fit the design of Nikola’s trucks, the person said.
Nikola plans to show investors its competitive edge in hydrogen-powered vehicles that