General Motors Rises After Unveiling 'Ultium' EV Drive System Plans

The comments followed a report by short-selling research firm Hindenburg Research saying it believes Nikola "is an intricate fraud built on dozens of lies over the course of its Founder and Executive Chairman Trevor Milton's career." The firm argued that it has "gathered extensive evidence-including recorded phone calls, text messages, private emails and behind-the-scenes photographs-detailing dozens of false statements by Nikola Founder Trevor Milton," adding that it has "never seen this level of deception at a public company, especially of this size."

Nikola has since denied Hindenberg's claims and said it has hired a law firm to evaluate legal recourse over the allegations. "To be clear, this was not a research report and it is not accurate. This was a hit job for short sale profit driven by greed," Nikola said in a statement. It added that it intended to bring the actions to the attention of the SEC.

The accusations came days after the company announced a 10-year alliance with General Motors. Under the terms of the agreement, GM will engineer and manufacture Nikola's Badger pickup truck and provide its Ultium battery system and Hydrotec fuel-cell technology for Nikola's semi-trucks in exchange for an 11% stake in the company valued at $2B.

On Tuesday, the Financial Times and Wall Street Journal each separately reported the Justice Department has joined securities regulators in probing allegations that Nikola Corp. (NKLA) misled investors by exaggerating claims about its technology

PRICE ACTION: In morning trading, shares of General Motors have gained about 1% to $31.77, while Tesla's stock has dropped almost 1% to $447.01. Shares of Nikola have advanced over 1% to $33.20.

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