- Shares of Nikola gained more than 15% on Wednesday.
- The company reiterated its committment to previously announced goals.
- Talks with General Motors remain ongoing, executives also said.
Electric truck maker Nikola Corporation (NASDAQ: NKLA) is looking to erase negative recent headlines by reassuring investors it remains committed to achieving previously announced milestones.
Nikola has gone through a series of negative media headlines and accusations — the first of which was a Bloomberg report that alleges Nikola may have misled the public about the capabilities of its trucks. Fast ford to September and Nikola was the subject of a short seller report by Hindenburg Research.
Looking for analysis to better figure out if you should buy Nikola’s stock now? Read this research piece to find out.
Nikola founder and Executive Chairman Trevor Milton went on to resign from the company as the short report attracted the attention of U.S. regulators. Days later, allegations of sexual assault by two women were made public.
Meanwhile, Nikola’s relationship with global automaker giant General Motors Company (NYSE: GM) is in jeopardy.
So Nikola is now switching from defense to offense and reassuring investors the negative headlines will not slow down its growth aspirations.
Nikola said in a press release it “remains committed to achieving” multiple milestones that excited investors, some of which include: 1) the completion of Phase 1 of the Arizona manufacturing facility, 2) testing of the FCEV truck prototype in 2022, and 3) beginning production of FCEV trucks in 2023.
Nikola also highlighted multiple catalysts working in its favor, including the European Union’s commitment to investing $1 trillion over the next 10 years to promote the hydrogen economy. This would benefit Nikola’s hydrogen-powered trucks that could revolutionize transportation.
Nikola added it remains “focused on executing on our strategic initiatives and laying the groundwork to become a vertically integrated zero-emissions transportation solutions provider.”
According to CNBC, Nikola’s press release avoided any mention of the GM partnership because executives continue to negotiate a final deal.
As part of the previously announced agreement, GM would produce the Nikola Badger pickup truck in 2022 and GM would assume an 11% ownership stake in Nikola. The deal was expected to close by Tuesday but Milton’s resignation has complicated the matter.
Nikola CEO Mark Russell told CNBC discussions “are continuing and when we have something to tell you then we will.”
CNBC’s auto expert Phil LeBeau added that his sources are expecting GM to “take a bigger stake in Nikola” but this could simply be due to Nikola’s stock weakness over the past few weeks. The two sides are also working towards finalizing an agreement on the Badger production.
“The talks continue,” LeBeau emphasized.
Despite a strong surge in Nikola’s stuck on Wednesday above the $20 per share level, shares are still far removed from its all-time high of $93.99 it saw shortly following its public debut.