NKLA has been on a constant downtrend since June 2020, when this went on 200%+ run to a peak of $97.44. It has been a rough road since then, a report from Hindenburg, constant downgrades, and a couple offerings, but, we could see things change in the near future. The vision is beginning to work and we could possibly see production late this year. There would need to be some changes made first for them to reach this goal.
Current Issues in the Company
Past employees, and even current employees of then company, have expressed how terribly management is. The main issue seems to be a lack of expertise from management. Since they are a start-up, a lot of the management positions are filled with young, and new employees. They lack the track record and experience to lead a company like Nikola. It is going to require a ton of effort to get Nikola to where Mark Russell, the CEO of Nikola, thinks it can go. Having that lack of experience from top management is going to slow the process, and ultimately eliminate the vision before it happens. Poor management has led to a toxic work environment, and in the end, no one will benefit. There is no involvement from upper management at all as well. CEO barley stops in to see how things are going. Only there for “the cameras” some would say.
This needs to be fixed if they want to succeed in the future. They need to make some changes in management, hire on experienced employees, and be more selective on the titles they give employees. The company sounds like a friends and family ordeal, if you know them, you got a management position. They need to see that fire and passion in the CEO. Look at Elon Musk. His employees are motivated to work for his vision. He is always seen in the factories, he even sleeps there sometimes. Fix the management issues and this company will succeed.
Lack of Focus
Nikola needs to stop taking on so many projects. They need to focus on the semi trucks and that’s it, for now. They are wasting money and resources when taking on other projects. The good thing is, we are starting to see this play out. They cut their watercraft and ATV projects in February of this year. If they focus all their time and resources into the semi truck, we will see production happen sooner than we expect.
Why NKLA Can Succeed
NKLA is entering a huge market, and they could be a big player years from now. They are currently valued at $6.3B heading into a multi-trillion dollar market. There is a ton of opportunity ahead, and if their vision becomes true, early investors will reap great reward. They are expanding fast and look to be preparing for more growth in the future. They are currently working on the completion of their factory in Arizona. They also have had a string of negative catalyst which has dropped their stock price low. Warren Buffett always said, “Be fearful when others are greedy, and be greedy only when others are fearful”. With the EV market expected to boom soon, NKLA could be a massive player in the industry.
Once they fix internal issues, this company will thrive. There needs to be some restructuring. They could be huge one day if they can bring their vison to reality. As time passes investors should look for these changes to take place. So far, it looks like they are doing the right things. They got rid of the ex-CEO which brought on most of the problems. They need to fix the environment that was created by him. As stated above, they are starting to focus on the semi truck project. If they keep heading in this direction, the near-future looks great for NKLA. Investors maybe rewarded in the near-future because of this. I am currently holding no position in NKLA but that may change soon. NKLA is starting to make changes internally, and we will begin to see the results as early as May. NKLA is definitely one to keep on your watchlist for now!
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