Weren't there VCs who put money into this? What were they thinking? Were they being amoral and hoping to ride this pump and dump or did they actually buy into this shit?
Bonus point for the ethical similarities between J. T. Marlin and Nikola.
Well, in the words of Batman when asked about his superpower, "I'm rich".
It's OK to simultaneously believe that "Elon Musk is very effective at growing engineering businesses to the point that they disrupt entire industries" and also that "Elon Musk is not as smart as he thinks he is, and his tweets are embarrassing".
https://fortune.com/2018/12/09/tesla-name-faraday-elon-musk/
A second company then copying exactly the same association? Different thing entirely.
There are times I'm glad to have misjudged someone.
Definitely, but worse than that, real companies that really should have known better.
GM associated themselves. For what reason I can’t figure out. It must have been high up because the GM engineers I know all knew it was a 100% scam.
It’s like anything else that confuses me in business. Some idiot made a mistake, sure, but then their boss approved that, and all the other people required approved it, and at no point did anyone say “Hey, wait, no, stop”.
They got cash from Nikola whether they ended up manufacturing anything for them or not, and had to put up nothing up front.
So long as the public are willing to believe they’re essential, they’ll remain too big to fail and don’t need to worry about their reputation.
If all there is, is a memo saying ‘just buy it, and don’t look too hard’, or it looks like they fell for an obvious scam, then the execs can be on the hook for negligence to the shareholders
I can feel the lawyers yachts being built.
GM is none of those. (And they were not proposing to acquire NKLA, for "due diligence" to apply for that reason.) They are a car company. Their execs' duty to GM shareholders is to not stupidly squander GM's money. The contract was a "win or wash" situation for GM - so that duty was fulfilled. They don't have to even do - let alone produce - a written analysis. The same goes for GM's contracts with the supplies of tires, floor mats, wiper blades, etc. for the cars they assemble.
Certainly one can accuse GM of acting rather uncaring and sleazy with regard to NKLA. Nothing special about that - most older people (at least from parts of the U.S. where the auto industry is concentrated) could tell you that all of the big auto makers got over their "Don't Be Evil" idealism many, many decades ago now.
Also, individually they have duties to not commit crimes (like conspiracy to defraud, or whatever).
If there is evidence they conspired with someone to commit securities fraud, even if it had nothing to do with GM, then regardless of their duties to GM, then they can go to jail for that.
If they knowingly were irresponsible/negligent as officers of the company in how they approved deals, they could be fired or sued, depending on how blatant it is.
Since it didn’t seem to hurt GM’s bottom line, seems like the latter is unlikely.
It's just, this time the pyramid collapsed faster than it should have. Due diligence is for losers.
Matt Levine wrote a section on this, about how Elon said good-bye to earnings calls since his funding is coming mostly from retail investors, to whom he speaks via Twitter and memes, they don't listen to the call anyhow so why bother :)
https://www.bloomberg.com/opinion/articles/2021-07-27/matt-l...
[1] Well unless (unless! unless!) it eventually turns out that Tesla is a fraud and you're copying that too.
A lot of EV startups like NKLA are going to come and go but very few if any will be able to replicate Teslas success in the long term. Retail investors are not always stupid, many of the same Tesla investors have been shorting NKLA since it came on via a spac offering.
Personally I don’t always love everything Elon does but I view him in many ways as a modern day Edison. It’s always funny to me to go back and read stuff said about Edison while he was alive. I very much color my view of Musk by historical perspective and try not to get lost in present day minutia.
Matt Levine has also struck me as more amused-- and perhaps confused-- than bitter about this.
BTW, you can subscribe to the email newsletter for Money Stuff, then you can access it without paying for a subscription to Bloomberg.
Matt Levine wrote an article mocking them for buying Hertz stock, then a bit later another one saying "wait no that was actually a very smart thing".
I'm not sure why that's interesting or important. The Tesla fanboys had no special insight into Tesla, Elon or anything. They are part of a cult of personality that bought the marketing hook, line, and sinker.
Only about a year ago there were hundreds of Trevor Milton fanboys all over HN, Reddit and elsewhere just sure that Nikola was the next Tesla and anyone that didn't agree was just "bitter" or had no vision. Where are they now?
There's no difference between either group of fanboys, really. Other than one got lucky and their cult leader delivered on some of his claims.
Nikola was building barely functional prototypes of their trucks years before Tesla was building barely functional Semi truck prototypes, for the record.
>What were they thinking? Were they being amoral and hoping to ride this pump and dump or did they actually buy into this shit?
Fundamentally, what have they done that's so evil compared to, say, the multitude of things Tesla has claimed over the past few years?
For example, Tesla claimed door-to-door cross country self-driving tests, oh, about 5 years ago. At what point is it aspiration versus indictable fraud?
So if you sell cars and land rockets, you can lie about other things?
If by "barely functional" you mean a metal skeleton on wheels that rolled down hills, then yes.
I'm not a shill for Tesla as they definitely have made very questionable claims in the past, but to claim that Nikola's semi is in any way similar to Tesla is a bit of a stretch.
And in 2022 it will be 2024. And you will continue to think that doesn't matter. If deadlines don't matter why can't Nikola claim the same thing? "It doesn't work yet, but it will?"
Tesla and Musk do many bad things, but I'm sure if their truck was just a shell - they'd be in deep trouble too.
They demonstrated fake Solar shingles though. Then bailed out a related party and did a fundraise on it.
That's a baseless accusation, where are the mods?
>They have been spotted driving all over the place and doing real world testing on actual highways and in cold weather.
Prototypes, with zero evidence they can achieve the claimed specifications. If you know otherwise, please, show us all. They are dependent on 4680 cells, which do not exist. They don't even have a factory, and they claimed the trucks would be ready for production 2 years ago. They will probably build something that works at some point in the future. Maybe Nikola could have as well? That is my point, where do you draw the line?
Now, what about FSD? And the solar shingles that "print money" that were faked on the set of Desperate Housewives and don't exist to this day? You know, they ones that Tesla shareholders are currently suing for? The ones that Tesla employees claim were fake in the deposition of said lawsuit? The ones you now buy are generic versions from China. What about the boring car tunnels; bit different from the old renderings, aren't they?
There is zero evidence Tesla has a semitruck that with the range the claim at the price they claim to be able to produce it.
So at most the price is wrong. That's nothing compared to offering a completely fake product.
I cannot wrap my head around this mindset.
So the truck doesn't exist in any manner in which they claim, be it speed, hauling capacity, range or price. But what they claim also isn't "fake"?
Let me spell it out, again: Tesla has raised money off of technology for which there's is no evidence they can or will ever achieve. FSD, solar shingles, the Semi's specs/price, the Cybertruck's spec/price (it's likely the Cybertruck as demonstrated isn't even street legal).
The fact that they have an unproven prototype roaming the streets is a long way from what they are selling. Why does the fact that they have one-off prototypes absolve them of this?
I've asked these questions multiple times, but the Tesla shareholders/astroturfers refuse to answer them:
1) had Nikola put their Semi cab on top of a golf cart frame to film the video (or better yet, a Model X frame ie no real underlying tech to match their claims), would that have been fine, because it "drove"? Sounds like it.
2) what about the Solar shingle demo? Employees involved in it claimed, under oath, that it did not function. It still doesn't exist today. The Buffalo factory is practically idle and shingles are generically sourced from China. Is that something you would consider "fake"?
Where did all those come from? You just said range and price before, and range is easy to fix.
And if a product costs more than expected to build, it still exists.
> shareholders/astroturfers
Shove off.
> solar shingles
They installed a couple dozen roofs, didn't they? Based on my existing knowledge I'd call it garbage but not fake. How long was this demo before those installations, and did any of the parts work?
Who cares "what I said before". These are claims they've made that have no basis in reality. Claiming "we have a truck that can do all this" and can't is not that far away from claiming "we have a working truck" when you don't.
>They installed a couple dozen roofs, didn't they?
So you don't even know, you're guessing. They literally installed fake roofs that didn't function on a Hollywood neighbourhood set piece, then bought the company who claimed to be able to make these (a related party) within days. Is that much different than rolling a truck down a hill to raise money?
This information is free on the internet, people have been reporting on it for years. But the Tesla PR machine is strong. Try reading the law suit deposition, and then go try to order the shingles they advertised during the event. Then go visit the Buffalo factory where they were to produce these shingles (received hundreds of millions in subsidies for it). Then go look at what they are actually installing, years later, at jacked prices (generic shingles anyone can order from Chinese producers). And if you're still keen, you can read the reporting on the lawsuit happening right now about how all this came together to bail out Solar City.
Here is an opinion piece about some of it:
https://www.bloomberg.com/opinion/articles/2021-07-30/nikola...
Not sure about you, but slapping an inferior product together, years later at a higher price, that isn't what you demonstrated when you took the money, is fraudulent:
https://www.theverge.com/2021/4/30/22410075/tesla-solar-roof...
"We can't actually deliver the product for the price we told you". Huh.
We can also talk about the "Paint it Black" FSD video, which was heavily edited to demonstrate full self driving capabilities which still don't exist today (and may never, but for which they have received billions in revenue) as a marketing piece. After that, maybe the battery swap (earned millions in subsidies from California), which also was not a feasible technology with a faked demonstration. Here's a little read on that one:
https://wattsupwiththat.com/2013/12/21/the-tesla-battery-swa...
>Based on my existing knowledge I'd call it garbage but not fake.
I guess one could argue the Nikola truck was "garbage" because it had no drivetrain, but not "fake" because it existed? We did see it roll down the hill, after all.
Nikola was a fraud. Other companies are doing the same thing, because it works.
>Shove off.
Boy, you were pretty quiet when people were accusing me of trolling and being a shortseller above, eh. Why is that?
I'm going to let you in on something cool: I'm not a shortseller, I have no financial stake in Tesla other than what I own, long, in S&P500 ETFs. Meanwhile, there are Tesla shareholders and owners in this thread and others, who don't offer any disclaimer when they praise the company.
Interesting how your preconceived biases can lead you to conclusions that are in fact the opposite of reality. Fancy that.
Because it's really hard to talk about whether a product is fraudulent or not if the list of problems keeps changing.
> Claiming "we have a truck that can do all this" and can't is not that far away from claiming "we have a working truck" when you don't.
To an extent, yes. With the huge caveat that production cost is not something a truck 'does'.
> So you don't even know, you're guessing.
I'm going by the best news articles I could find on short notice. If you have better, link it. I don't think it's reasonable to demand I go do physical tours before I can talk about the subject.
https://www.reuters.com/article/us-tesla-solar-insight/insid...
"In California, the nation’s leading solar market, there were twelve Tesla roof systems connected to the grid as of May 31"
https://www.youtube.com/watch?v=EFWKVraGI1E
"Tesla Solar Roof - 100 Days After Installation"
> They literally installed fake roofs that didn't function on a Hollywood neighbourhood set piece, then bought the company who claimed to be able to make these (a related party) within days. Is that much different than rolling a truck down a hill to raise money?
So with this I was able to find some info. It's true, there was a fake demo of a particular kind of tile.
But the product does exist now. Your claim that it still doesn't exist is just wrong.
It's also important to note that they had different-looking tiles that already worked, and by the time they took preorders it looks like things were working.
So that's bad, but it's not on the same level as nikola.
> Not sure about you, but slapping an inferior product together, years later at a higher price, that isn't what you demonstrated when you took the money, is fraudulent
If you charge more than you promised, yes. That's different from being unable to meet the originally planned production cost on something. If you let people cancel orders, which tesla appears to be doing, it's not fraud.
> the battery swap (earned millions in subsidies from California), which also was not a feasible technology with a faked demonstration
Wow, that's pretty bad! Thanks for the info, I'll bring it up to people in the future.
Still not on par with a fake product though.
> Boy, you were pretty quiet when people were accusing me of trolling and being a shortseller above, eh. Why is that?
I don't respond to every comment that is rude to a third party. Almost none of them, really.
> Interesting how your preconceived biases can lead you to conclusions that are in fact the opposite of reality. Fancy that.
You're making wild assumptions about what I believe and getting them wrong. Fancy that.
And you do/did come off a bit like a troll in some of your comments.
what's that about generics from China? I'd love a link
Okay, how much of a stretch? If they would have stuck a nowhere-near-production ready battery and drivetrain system into the Nikola trucks and pretended it was complete, that would have been fine? That probably wouldn't have been difficult, but equally fraudulent.
Especially as Tesla has done a great job of going right up to the border on misleading claims, and even stepped its toes over the line a bit, but not in a way that would be as easy to prosecute as the more blatant Nikola.
Tesla was run by a technical founder (Stanford PhD pedigree fwiw) that knows his shit (though a bit crazy and prone to exaggeration and hyperbole) and the company has some of the best engineers in the world employed there.
Nikola was founded by a dude with zero technical background who as far as anyone can tell had no serious engineering expertise in-house. He even hired his brother--a guy who used to install carpets--to run Nikola's hydrogen infrastructure.
These two companies aren't even in the same league imo
Musk was not a Stanford PhD nor a founder, if that's who you are referring to. If you can point me to any evidence of either that doesn't come from him, I'll be happy to stand corrected.
>He even hired his brother--a guy who used to install carpets--to run Nikola's hydrogen infrastructure.
Can you tell me what Kimball's qualifications are for sitting on the Tesla board?
I mean, I agree, the Nikola story is hilarious and stupid. But somehow other companies get away with what is the same thing. Milton didn't get to claim "aspiration", or that the trucks will "eventually" work.
No comment on the Stanford piece, though it seems believable…
Kimball doesn't run part of the infrastructure.
You sound like someone who writes SeekingAlpha FUD articles.
I suppose the HN rules go out the window when we are defending Musk.
>Kimball doesn't run part of the infrastructure.
He's on the board. What are his qualifications.
>Legally he is a founder
Yes, a billionaire paid money so that people like you could claim he's a "founder". Is that what founder means to you? Laughable.
Oh I've heard. Great story. Is it true? There's a lot of finely crafted mythology around the man.
you're clearly just a deranged person with some weird obsession about Elon.
Basically the polar opposite of the Elon Cultists.
Musk was accepted and enrolled into a Material Science PhD at Stanford. He dropped out to be an entrepreneur. Really not sure why you are being pedantic here. The point is he has the technical chops as evidenced by being in a Stanford engineering PhD program. Trevor had absolutely nothing.
>Can you tell me what Kimball's qualifications are for sitting on the Tesla board?
It's spelled Kimbal, as long as we are being pedantic and all.
And board members of large public companies, and even startups, generally have ZERO operational control within the company.
This seems, quite different than Trevor's Fuck-up brother literally running hydrogen infrastructure for his company.
I really don't see why you are so obsessed with shitting on Tesla or defending Nikola here. There is a big fucking difference between Tesla and the Nikola fraud, and it was obvious from the start.