Shares of electric-truck maker Nikola Corp tumbled as much as 30% on Monday after founder Trevor Milton stepped down following claims of nepotism and fraud by a Wall Street short-seller that have drawn interest from US regulators.
In a scathing report published just after the GM tie-up two weeks ago, short-seller Hindenburg Research said it had enough evidence to show Nikola and Milton made false claims about the company's proprietary technology to form partnerships with large automakers. Stock market investors, who have been selling the company's shares for a week, were not convinced, driving the stock down by as much as a third in early deals before it found some support.
GM has agreed to build an electric pickup for Nikola and supply batteries and hydrogen fuel cells for commercial trucks. In return, GM is also expected to receive payments of up to US$700 million for assembling the Nikola Badger pickup.