[Car Talk Forest] Whether 'Nikola' will become 'Tesla' or 'Theranos'... the chaos of 'Nikola'

Clumsy Explanation... Ownership of Technology Faces Authenticity Controversy

[Asia Economy Reporter Sung Kiho] Nikola, the American hydrogen electric vehicle company that had been spotlighted as the "Second Tesla," is embroiled in a fraud controversy. Nikola has responded by claiming it is a "short-seller's stock manipulation," but this has only seemed to amplify the controversy.

The core issue in the Nikola controversy is "whether they really have the technology." Nikola promotes that it possesses core technologies in hydrogen fuel cells, batteries, and hydrogen production, but so far, it has shown nothing. This has led to criticism that Nikola may be exaggerating its technological capabilities to attract investment.

However, it is actually difficult to apply such standards to a startup like Nikola. Startups operate by first presenting a vision, then receiving investment, and subsequently pouring money and manpower into realizing that vision. This is completely different from the operational model of established companies that grow their business with already completed technologies.

A representative example is Tesla. Tesla was founded in 2003, gathered investments, and based on that, released its first vehicle, the "Roadster," in 2008. Even that was not a purely Tesla vehicle but an electric car based on the Lotus Elise. Afterwards, Tesla sequentially introduced the sedan Model S, the sport utility vehicle (SUV) Model X, and the mid-size sedan Model 3, completing its lineup, and has recorded continuous profits since 2019, 16 years after its founding.

Nevertheless, the spread of the fraud controversy surrounding Nikola is fueled by the case of Theranos, which exploited the nature of startups. Theranos, considered Silicon Valley's worst fraud, attracted market attention by promoting a medical kit called "Edison" that could diagnose over 250 diseases with a tiny amount of blood. The company was valued at over $9 billion and became the top unicorn company in the U.S. However, it was revealed that Theranos's Edison kit could only diagnose 16 diseases, contrary to its claims of diagnosing over 250. The remaining 200 diseases were diagnosed using medical devices released by other companies. In 2018, Theranos went through liquidation, and Holmes and the COO are currently on trial.

Interest in Investigation Results by U.S. State Department and SEC

The conclusion of the Nikola controversy is whether it can deliver actual results. As mentioned earlier, it is difficult to hastily judge Nikola's current technological capabilities due to the nature of startups. However, the explanation that the hydrogen truck shown in the demonstration video was towed to the top of a hill and rolled down for filming, and that Nikola "never said it moved by its own power," is enough to raise suspicion. The focus now is on what conclusions the investigations by the U.S. Department of Justice, the Securities and Exchange Commission, and the Manhattan U.S. Attorney's Office will reach at this point.