Trevor Milton, the creator of U.S. electric car maker Nikola Corp, stepped down from the position of an Executive Chairman on Sunday. According to the firm, the company is defending itself against allegations of a lack of sales that it misled customers and car manufacturers.
Trevor tweeted that he would be watching the company from the sidelines.
I will be cheering from the sidelines with you. Your greatest fan. Trevor Milton, the CEO of Nikola Motors
Stephen Girsky, a former deputy chairman and a board director of Nikola's General Motors Co, was instantly elected as a President of the Body. An earlier study by Hindenburg Research, a shorter-seller said that Nikola deceived investors by pushing their equities down.
Hindenburg said it collected enough information to indicate that Milton made misleading comments on patented technologies to form alliances with major car manufacturers. The charges were denied and Nikola confronted the court seller with legal action.
The company's shares reacted with a sharp drop on Monday after the announcement on Sunday. The decline in the share price was -24.86% even before the opening of the main trading session.
Two days prior to announcing Hindenburg, GM announced that it took an 11% stake in Nikola, worth around $2 billion, to make Tesla Inc. electric pickup trucks and decided to engage in a relationship.
In a month after it burns its own game-changing battery, Nikola relies on California-based maker, Romeo Power Technology, to develop batteries for one of its electric trucks, the Financial Times announced last week.
According to the Bloomberg News report last week, the United States Securities and Exchange Commission (SEC) is investigating Nikola to determine the importance of Hindenburg 's claims.
Nikola told the SEC about the issues related to the study at the time. The U.S. Department of Justice has examined the allegations contained in this report, the FT said last week.