Leaked document reveals Nikola flip-flopped on whether it would spend any of its $17 million of customer deposits to fund the Nikola One

  • Nikola said in 2018 it hadn't spent any of the money deposited by companies that had reserved its electric semitrucks.
  • But in a 2016 business plan viewed by Business Insider, Nikola suggested it had already used some of those funds to cover operating expenses.
  • "We generally use these funds for working capital and other general company purposes," the electric-truck startup said at the time.
  • Are you a current or former Nikola employee? Do you have an opinion about what it's like to work there? Contact this reporter at mmatousek@businessinsider.com, on Signal at 646-768-4712, or via his encrypted email address mmatousek@protonmail.com.
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In 2018, Nikola said it hadn't spent a single dollar of the deposits made by companies that had preordered its electric semitrucks, contradicting a claim it made in a business plan two years earlier.

In a 2016 business plan, which Business Insider reviewed, Nikola said it intended to use deposit money to fund operating expenses and suggested it was already doing so.

"At this time, we do not plan to hold reservation payments separately or in an escrow or trust fund or pay any interest on reservation payments," the company said. "We generally use these funds for working capital and other general company purposes."

Nikola returned all the reservation payments it had received at the time in 2018, saying it had never dipped into its deposit reserve.

"We don't use your money to operate our business," the company said in an April 2018 tweet. "We want everyone to know we have never used a dollar of deposit money in the history of our company."

The company said in other tweets that it had returned a total of 11,500 deposits that cost $1,500 each. Nikola didn't explain why it refunded the preorder payments in the April 2018 tweet but said later that year it had taken deposits only to ensure its reservation holders were seriously interested in Nikola's vehicles.

"We collected deposits to ensure we had a viable business case with customers," the company said in a November 2018 tweet. "Once we knew they were serious enough to pay deposits, we decided to refund the money."

In response to a request for comment, a Nikola spokesperson did not address the disparity between the language in the 2016 business plan and the 2018 tweet but gave the following statement:

At Nikola, we are focused on moving forward and executing on our strategic initiatives. Today, we have a clearly articulated roadmap to enable our customers to integrate next-generation truck technology, hydrogen-fueling infrastructure, and maintenance. With this ecosystem, Nikola and its strategic business partners can lead the way as global leaders in zero-emission transportation.

Nikola's communications with investors, reservation holders, and the general public have come under scrutiny in recent months.

Bloomberg reported in June that Trevor Milton, Nikola's founder and former CEO, had suggested to an audience that an inoperable prototype of the Nikola One semi could drive under its own power. Three months later, Hindenburg Research, a firm which placed bets that Nikola's share price would fall, alleged in a report that Nikola and Milton misled investors about the capabilities of Nikola's vehicles, the amount of technology the company had developed in-house, and its progress on key goals, like significantly reducing the cost of hydrogen.

Milton and Nikola denied many of Hindenburg's allegations but acknowledged the incident reported by Bloomberg and that a Nikola One which appeared in a video to be driving under its own power was instead rolling down a hill.

Milton later stepped down from the company, saying he didn't want the allegations against him to become a distraction. Since the Hindenburg report's release, Nikola's stock price has tumbled as the company has sought to reassure investors about its future.

Are you a current or former Nikola employee? Do you have an opinion about what it's like to work there? Contact this reporter at mmatousek@businessinsider.com, on Signal at 646-768-4712, or via his encrypted email address mmatousek@protonmail.com.

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