Nikola Founder Already Channeling Elon Musk, Threatens Bloomberg With Lawsuit
A Bloomberg story says Nikola's founder claimed a 2016 prototype was driveable. He made his feelings clear on Twitter.
Good morning and welcome to Speed Lines, The Drive's roundup of what matters in the world of cars and transportation. Today we're talking about a war of words between Nikola's founder and Bloomberg, Europe's glut of unsold new cars, and whether safety measures at auto plants are proving to be effective or not.
Also, a programming note: Speed Lines will not run tomorrow, as Juneteenth is now a company holiday at The Drive Media moving forward. We will have a supply of pre-written news stories, features, and reviews for you to read instead.
Nikola Vs. Bloomberg
One of the stranger stories that's happened in our world in 2020—and given everything that has happened in 2020, that's saying a lot—has been that of nascent electric and hydrogen heavy trucking startup Nikola. Though it has yet to produce any products and expects no revenue at all this year, it already IPO'd with a valuation of $34 billion that made its CEO and founder, Trevor Milton, the 188th richest person in the world. Capitalism, everybody!
But to say Nikola has a lot to prove would be a grand understatement. The company was founded in 2014, initially tried to build trucks powered by natural gas-powered turbines and, as noted a moment ago, does not sell anything yet. Skepticism is warranted. And this Bloomberg piece has already sparked a war between that outlet and Milton himself, with the latter seemingly already drawing on the Late Stage Elon Musk Playbook in response.
The story goes back to a December 2016 event where Nikola unveiled a prototype truck. It claims that at this event, Milton suggested the vehicle—called Nikola One—was actually driveable and not a "pusher," industry jargon for a non-operable concept car that needs to get pushed from place to place. This was concerning to several people at the time, as the truck was indeed not operable, and leads to the bombastic headline "Nikola Founder Exaggerated the Capability of His Debut Truck":
At the event 3 1/2 years ago, Milton said the company had put up a chain to keep people from bumping into any of the vehicle controls. “We’re going to try to keep people from driving off,” he said. “This thing fully functions and works.”
Later, he said the truck was not a “pusher,” referring to an inoperable prototype that needed to be nudged onto the stage.
The people familiar with the truck, who asked not to be identified discussing sensitive information, said they were concerned about the statements. Gears and motors were missing, and while the words “H2 Zero Emission Hydrogen Electric” were emblazoned on the vehicle, there was no fuel cell on board.
“There wasn’t a fuel cell in the truck. We never claimed there was,” Milton said. He confirmed the motors and gears weren’t in the vehicle for safety reasons.
The parallels to Musk are obvious, and indeed drawn in the story itself. And in that spirit, Milton responded to the story... on Twitter, and with legal threats against Bloomberg. Here we go:
Am I going to start calling everyone I don't like a "jackjob"? Yes. Yes I am. (And of course, cue all the reply-tweets accusing Bloomberg of fake news, spreading FUD and being in the tank for Big Oil. I've seen this movie before.)
Obviously, I wasn't in the room when Bloomberg did its interviews with Milton, nor was I at Nikola's December 2016 event when this took place, as far as I can remember. A recording likely exists somewhere that would easily prove or disprove this. But this incident reveals several things: Nikola's claims and finances will be under a more powerful microscope than ever before, and Milton's going to go full-force against anyone he doesn't like. It's too soon to have a real take on Nikola—I'm excited to see what they do. But they have to do it first.
Europe's EV Incentives Don't Move The Market
EVs are a growing but still tiny slice of the market. So why are automakers going so heavily in that direction? Well, most companies are really only going to care about climate change if they're made to, and that is exactly what's happening with tightening emissions regulations—especially in Europe and China. Mandatory electrification is spurring much of the transformation we're seeing in the auto industry.
Part of that is electric vehicle incentives for buyers. But as this Wall Street Journal story points out, in Germany at least, they are not helping move a huge oversupply of conventional cars as the economy slowly starts to recover from the coronavirus downturn:
Countries such as France and Germany, two of the biggest auto markets in Europe, have approved billions of euros in cash incentives to encourage consumers to buy cars. But while France is supporting purchases of both conventional and electric cars, Germany is focusing on electric and hybrid vehicles, doing nothing to help address the glut of unsold gasoline and diesel cars.
The market for plug-in electric vehicles remains a niche, accounting for about 7% of EU new-car sales in the first quarter, or 167,132 vehicles, according to the European manufacturers’ group.
The recent decisions regarding cash incentives marked a rare lobbying setback for an industry that had pushed for conventional cars to benefit from the measures. Auto executives had argued that replacing older diesel and gasoline cars with new, less-polluting models would benefit the environment.
Meanwhile, in America, we can't get enough pickup trucks. Our society's transition to electrification is an inevitable one, but it will not happen in a straight line.
No Major Outbreaks Yet, Let's Hope It Stays That Way
Speaking of the coronavirus, we are far from out of the woods there, and don't let anyone tell you otherwise. However, the auto industry is working on slowly getting back to full speed, and so far, there have not been any major outbreaks in a U.S. auto plant since most of the, reopened on May 18, reports Reuters. Aggressive safety measures like temperature checks, partitions, personal protective equipment, and hand sanitizing seem to be working for now.
But as we noted earlier this week, absences at plants are still a problem. As are workers potentially getting infected outside of work and then bringing the virus into the plants. From that story:
The risk of an infection picked up outside a plant spreading along assembly lines remains a prime concern, however. An outbreak could shut down a factory costing a manufacturer millions of dollars a day. The disruption caused by the pandemic is creating other challenges as well.
“People leave work and then they have their own protocols outside of the workplace,” said Gerald Kariem, UAW vice president and director of the union’s Ford department. “But in terms of the workplace, the protocols are probably better than the protocols that you’ll see out in the general public.”
Also, virus rates are going way up in reopening states that happen to have auto plants, like Texas. This is all still very much a work in progress.
On Our Radar
Mitsubishi CEO defends pay cuts amid massive cost-reduction campaign (Automotive News)
Read These To Seem Smart And Interesting
What Are These Enormous Blobs 1,800 Miles Beneath Our Feet? (Popular Mechanics)
The Gentlemanly Hater’s Guide to Gone With the Wind (The New Republic)
Do you see Nikola as actually the next big thing, or is Milton already going Full Elon without delivering enough yet?
- RELATEDFounder of Electric Truck Company Nikola Now World’s 188th Richest Person After IPOWall Street is very fond of Nikola. Can it transform trucking with EVs and hydrogen?READ NOW
- RELATEDCan Electric Truck Company Nikola Become the Next Tesla After Going Public?Phoenix-based Nikola will go public this week, possibly worth $11 billion or more.READ NOW
- RELATEDLeak: This Is Probably the All-Electric Volkswagen ID.4 CrossoverMonths after its debut was delayed, we still hadn't seen the mass-market EV. That's all changed now.READ NOW