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Nikola’s Trevor Milton Has $7.4 Billion Fortune on Free Truck Orders

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His company has sent his net worth soaring to $7.4 billion, but Trevor Milton is frustrated.

The executive chairman of Nikola Corp. is under siege from skeptics of the company he started in 2014 with the goal of revolutionizing the trucking industry. The doubters who have him particularly down are criticizing him for taking orders for hydrogen fuel cell-powered semis and saying they’re worth $10 billion.

The number has come under scrutiny for a few reasons. For starters, reservations for Nikola’s truck cost nothing. Milton says the company took money initially but paid it all back after Tesla Inc. got criticized for funding itself a similar way.

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“We had deposits with thousands and thousands of trucks, and we just decided, ‘You know what, it’s not worth people thinking that we’re a Ponzi scheme, fake startup that’s using people’s money,’” Milton said in an interview June 11 from his Utah ranch.

Now, with 14,000 orders but no cash to show for it, the antagonists are out in full force. The pro-Tesla community is particularly harsh.

Trevor Milton, CEO of Nikola Motor Co.

Milton

“People started bashing us because they said, ‘Oh you don’t have deposits.’ It’s like, good hell, you can’t win with these people,” Milton said. “No matter what you do, you can’t win.”

Of course, converting free orders into binding contracts with paid deposits is just the start of the challenges ahead. Milton, 38, first showed Nikola’s debut semi-truck 3½ years ago and has produced only prototypes thus far. Its business model — bundling big rigs and the hydrogen to fuel them upfront — has yet to be tested. Toyota Motor Corp. is five years into producing its first fuel cell car, and the richest and most valuable automaker in the world has barely gotten sales off the ground.

Time will tell if Nikola’s surge in its first week of trading was a story of short-lived exuberance, where an unproven startup rode a wave of retail investors gobbling up shares of shaky companies. After a two-day retreat, the stock surged as much as 15% before the start of regular trading June 12. Milton, who owns about a third of Nikola — a stake investors valued as high as $10 billion this week — says he doesn’t care.

“It’s really part of the noise,” Milton said. His focus is on building Nikola, and he can’t sell any shares for the next 12 months. “I don’t really have any emotion to those numbers because they’re not real right now when it comes to my vision for the next five or 10 years.”

Nikola’s stock doubled June 8 after Milton tweeted the company will start taking reservations for a pickup model called the Badger. He didn’t mention until after the market closed that deliveries are still two years away and subject to a partnership with an established manufacturer that has yet to be announced.

The next day, Milton told Yahoo Finance that his goal was to dethrone the F-150, the crown jewel of Ford Motor Co.’s pickup franchise that’s topped U.S. sales charts for the last 43 years. Nikola finished the day with almost the same market value as Ford, which had $156 billion of revenue last year.

Nikola briefly eclipsed Ford in market value.

Citron’s Short

A company that isn’t expecting to have its first $1 billion revenue year until 2023 suddenly rivaling Ford drew some attention. Andrew Left, the outspoken short seller and founder of Citron Research, predicted Nikola’s stock price, which got as high as $93.99 in intraday trading June 9, would be back to $40 in a month.

“You can’t even borrow the stock now because everybody wants to short it,” said Left, who confirmed by phone June 11 that he is among those betting against the shares. “I wouldn’t be surprised if they never get a truck on the road.”

“He never even bothered reaching out,” Milton said of Left. “He doesn’t [care] about the facts.”

Musk’s Animus

Milton’s big ambitions, Twitter sparring and choice of name for his company have drawn inevitable comparisons with Elon Musk, who ranks 209 spots higher on the Bloomberg Billionaires Index with an estimated $47.4 billion net worth.

In addition to being named after the same famed inventor, the companies share the goal of shaking up the trucking market. Nikola sued Tesla in May 2018, claiming the maker of the Model 3 had copied patented design features of its tractor trailers.

Musk called the suit “laughable” and said the claims were “absurd” on an earnings call the day after Nikola filed its complaint.

Nikola’s stock retreated June 10 after Musk, 48, told employees in an internal email it was “time to go all out” and put Tesla’s Semi into volume production.

“He doesn’t like us, and that’s OK,” Milton said of Musk.

Milton’s Roots

Born in Utah in the early 1980s, Milton grew up on a farm and spent 18 months in Brazil teaching English on a church mission. He called living in the slums “a humbling experience.”

He then studied Spanish in Puerto Rico before returning to the U.S. He sold his first venture — an alarm system company — for about $1.5 million. “I thought I was on top of the world,” he said.

Other pursuits followed before Milton founded dHybrid Systems, a storage technology company for natural gas that was acquired by metals manufacturer Worthington Industries Inc. Milton left to establish Nikola in 2014 and agreed to a $2 million seed investment from his former employer on the back of a napkin.

He picked up more investors along the way. Activist Jeff Ubben of ValueAct Capital Management cold called him in 2017 and ended up putting in more than $30 million. CNH Industrial NV, the maker of Iveco trucks that’s part of the billionaire Agnelli family’s empire, invested $100 million in cash and committed to a $150 million in-kind contribution last year.

Milton, who agreed to a reduced salary last year to offset costs associated with his airplane pilot being on Nikola’s payroll, flies back and forth often between the company’s Phoenix headquarters and his ranch. When in Utah, he likes to head out on his four-wheeler.

He says speeding through the mountains helps him clear his head and recharge as he strives to prove the skeptics wrong.

“Come back in 12 months and watch how it’s done,” Milton said. “I’m an innovator, I’ll let the haters hate. I’m here to create, I’m not here to destroy.”

Tom Metcalf, Gabrielle Coppola and Ed Ludlow were the primary contributors to this report.

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Source: https://www.ttnews.com/articles/nikolas-trevor-milton-has-74-billion-fortune-free-truck-orders

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Rivian adopts mobile service model for maximum convenience

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Rivian Service promises to provide a proactive and personal approach to mobile vehicle service. Rivian seems to have developed an intricate mobile service model to make vehicle care more convenient for R1T and R1S owners.

Over-the-air updates will support Rivian’s mobile service model to optimize a vehicle’s performance continuously. Most of the over-the-air updates will take place at night, making it more convenient for owners.

The company’s mobile service will also be backed by Rivian Remote Care, enabling the company to perform comprehensive diagnostics from afar. With Rivian Remote Care, technicians can proactively identify most vehicle problems even before the owner notices them.

Credit: Rivian

“We’re remotely diagnosing vehicles and pre-ordering parts if needed. By the time we arrive for your mobile service appointment, we’re ready to resolve your issue on the spots,” said Edwin, a Rivian Service technician.

Rivian will have a fleet of mobile service vans ready for deployment at any time. Rivian mobile technicians can attend to calls at an owner’s home, workplace, or anywhere service is needed within the United States and Canada. Rivian plans to expand its mobile services as it reaches other markets.

Rivian technicians will also bring vehicles that need extensive care to service centers and return them to owners afterward. The company will provide a loaner to owners while their cars are cared for at the service center. Rivian has not specified what vehicles will be used as loaners.

Rivian plans to open over 40 service centers in the United States and Canada soon. More service centers are planned for the future as Rivian grows. The company has also established a network of Rivian-owned and Rivian-certified collision centers for bodywork and exterior damages.

Rivian Service seems to go hand-in-hand with the company’s warranty coverage. Rivian’s warranty system is also quite intricate. It includes a Comprehensive Warranty, a Battery Warranty, a Drivetrain Warranty, and a Perforation Corrosion Warranty.

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Rivian adopts mobile service model for maximum convenience

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Lucid Motors, Rivian sued by Illinois car dealers for direct sales

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Lucid Motors and Rivian were sued by the Illinois Automobile Dealers Association, the Chicago Automobile Trade Association, and some individual franchised auto dealerships in the state for selling vehicles directly to consumers.

The numerous plaintiffs are accusing both Rivian and Lucid of violating state laws that require new vehicles to be sold through franchised dealerships. The direct-to-consumer sales platform has become popular with electric car companies, especially Tesla who has never operated through dealerships. While each of the aforementioned automotive companies does have showrooms in operation to display their products, they do not have salespeople or sales managers who negotiate prices with customers. The costs are the same for everyone, a strategy that has alleviated a lot of stress from the car buying process.

In May 2019, the dealers, the Secretary of State, and Tesla entered an agreement that would consent to the automaker obtaining no more than 13 dealer licenses in Illinois. This allowed showrooms to sell vehicles to customers, but it only applies to Tesla and not to Lucid and Rivian.

The new lawsuit against Rivian and Lucid alleges the Secretary of State of “turning a blind eye to Rivian’s unlicensed sales operations,” according to the Chicago Tribune.

“We have no choice but to file this lawsuit, both to protect consumers as well as the hundreds of franchised dealers across the state who contribute to the local economy,” Pete Sander, the Illinois Automobile Dealers Association President, said. Sander represents more than 700 auto dealers that operate over 2,300 franchises across the state.

Credit: Lucid Motors

The Illinois Vehicle Code and the Illinois Motor Vehicle Franchise Act were cited in the lawsuit. These mandate that all vehicle sales to the public “must be made through licensed and independent franchised” dealers.

Lucid operates out of California and has its main production facility in Arizona. The company recently opened a sales studio in Oak Brook, a suburb of Chicago that is home to several large corporations like Ace Hardware and Blistex. However, Rivian is based in Normal, Illinois, and the lawsuit seems to affect it more than Lucid simply because of the company’s base location.

The Illinois Attorney General’s office issued “an informal opinion” last summer that stated new automotive manufactures are not expressly required by law to establish franchised dealerships to sell their cars. This gives companies like Rivian and Lucid the opportunity to sell their products directly to customers unless the lawsuit filed by the numerous plaintiffs moves forward. A spokesperson for the Secretary of State’s office said they would review the complaint when it comes to their office.

Lucid Motors, Rivian sued by Illinois car dealers for direct sales

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Source: https://www.teslarati.com/lucid-rivian-lawsuit-direct-sales-ban-illinois/

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Elon Musk’s Starlink Beta meets opposition from India’s industry body

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It appears that Starlink is facing a challenge in India, a country expected to receive coverage from the satellite internet system sometime next year. 

The opposition against Starlink was initiated by the Broadband India Forum, which has written a request to the Telecom Regulatory Authority of India (TRAI) and the Indian Space Research Organization (ISRO). The forum asked the bodies to block SpaceX from pre-selling the beta version of the satellite internet service in the country. 

As noted in a report from The Economic Times, TV Ramachandran, the industry body president, argued that SpaceX does not have the necessary license or authorizations from the government to offer its beta services in India. 

The Broadband India Forum represents companies such as Amazon, Facebook, Google, Hughes, and Microsoft. In its request, the forum asked the bodies to “urgently intervene to protect fair competition and adherence to existing policy and regulatory norms.” It also noted that SpaceX seemed to be “non-compliant to existing guidelines” in India.  

Explaining further, the forum added that Starlink does not have its own ground stations in the country, nor does it have the satellite frequency authorization from the ISRO and the Department of Telecommunications (DoT). According to the forum, these are needed for a company to be allowed to offer beta services in India. 

SpaceX, for its part, has not issued a statement about the matter. In a statement to the Times, a senior TRAI official has stated that the issue brought up by the Broadband India Forum “would be examined.”

SpaceX is currently offering pre-orders for the beta version of Starlink in India for a fully refundable deposit of $99 (about Rs 7,000). The satellite internet service is poised to compete with other satellite communication services such as the Bharti Group and the UK government-owned OneWeb, which is also expected to launch its services sometime in 2022. Competition may also be coming in the form of Amazon’s Project Kuiper, which is yet to provide internet services, even in beta form. 

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Elon Musk’s Starlink Beta meets opposition from India’s industry body

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Elon Musk to become board member of Endeavor Group Holdings: SEC Filing

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Tesla CEO Elon Musk will join the Endeavor Group Holdings Board of Directors ahead of the group’s Initial Public Offering, a filing with the Securities and Exchange Commission says.

Musk, 49, currently spends his time with Tesla, SpaceX, Neuralink, and The Boring Company, but will join the Endeavor board in the coming months, the filing says. He is currently listed as a “Director Nominee.” However, the filing describes what Musk’s eventual position will be.

“Mr. Musk is currently a director nominee and will become a member of our board of directors at or prior to the pricing of this offering,” the filing says. “Mr. Musk was selected to serve on our board of directors because of his professional background and experience running a public company, his previously held senior executive-level positions, his service on other public company boards and his experience starting, growing and integrating businesses.”

Endeavor includes several well-known brands under its parent company, including talent agencies WME and IMG, and premier mixed martial arts promotion Ultimate Fighting Championship, most commonly referred to as the UFC. The UFC was purchased by Endeavor’s WME-IMG joint venture in July 2016 for $4.2 billion.

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Endeavor had attempted to launch an IPO in the past but pulled the plug on the effort at the last minute in the Fall of 2019 when market conditions were unfavorable. The company may have sensed it wouldn’t reach its fundraising goal, according to Deadline, and opted to wait for better economic circumstances.

It also skipped 2020 as a possible date for its IPO due to the Coronavirus pandemic. Despite pulling in less of a profit compared to 2019, CEO Ari Emanuel stated the company remained resilient despite the tough circumstances and is attempting to initiate an IPO in the coming months.

“As challenging a year as 2020 was, it underscored the strength, creativity, and resilience of our people who mobilized time and time again in the face of overwhelming odds,” Emanuel wrote in the S-1 filing. “We made difficult decisions but worked as a team to find creative solutions and best position the business for the future.” The company reported $3.5 billion in revenue last year, down $1.1 billion from 2019.

The filing for the possible Endeavor IPO indicates the company wants to raise $100 million, but this number could ultimately change.

As long as Endeavor can raise the correct capital and it avoids any other dicey economic uncertainties, it will trade under the “EDR” ticker symbol on the New York Stock Exchange.

Elon Musk to become board member of Endeavor Group Holdings: SEC Filing

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Source: https://www.teslarati.com/elon-musk-endeavor-group-holdings-boardmember/

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