The CEO of Nikola Motors, Trevor Milton, has stepped down from the company just as the Securities and Exchange Commission and U.S. Department of Justice begin their investigations into the embattled electric vehicle maker.
Milton was accused of operating an “intricate fraud,” by a financial research firm shortly after GM announced it had entered a technical and strategic partnership with the start-up earlier this month. The report accused Nikola of making false claims about and/or exaggerating the capabilities of its electric vehicle technology. Hindenberg Research, which authored the report, also said it had “recorded phone calls, text messages, private emails and behind-the-scenes photographs-detailing dozens of false statements by Nikola Founder Trevor Milton,” and added that it had “never seen this level of deception at a public company, especially of this size.”
Milton will be replaced by Nikola board member Steve Girsky, a former GM board member who is credited with helping lead the automaker out of bankruptcy. In a statement, Milton said he stepped down from Nikola to ensure the future success of the company.
“Nikola is truly in my blood and always will be, and the focus should be on the company and its world-changing mission, not me,” Milton said, as quoted by Bloomberg. “So, I made the difficult decision to approach the board and step aside.”
“On behalf of the Board, I want to thank Trevor for his visionary leadership and significant contributions to Nikola since its founding,” added Girsky. “Trevor saw the possibility of creating an end-to-end zero-emission transportation system when the industry was still in its nascent stages and took action to build the Nikola of today, with world-class partnerships, groundbreaking R&D, and a revolutionary business model. I know I speak for everyone at Nikola in our gratitude and in wishing him all the best.”
GM announced earlier this month that it would take a $2 billion stake in Nikola in exchange for giving the company access to its Ultium lithium-ion batteries, Hydrotec hydrogen fuel cells and other electric vehicle technology. GM will also build the Nikola Badger on behalf of the company, which is a battery-electric performance pickup designed to take on the Ford F-150 Raptor. Nikola shares rallied following GM’s announcement but subsequently crashed once the Hindenberg Research report hit the web.
GM remains confident that its partnership with Nikola is the right way forward for both companies, despite the active SEC and DoJ investigations into the Phoenix-based start-up.
“We are fully confident in the value we will create by working together,” GM said.