Nikola could sell or partially sell the company
This was reported by Bloomberg, citing insiders saying that Nikola’s liquidity problems were the reason. In addition to selling (or partially selling), the company could also bring in new partners or raise new funds. However, no final decisions have yet been made.
Nikola, a manufacturer of battery electric and fuel cell trucks, would not comment explicitly on the various options, but told Bloomberg by email: “Despite external headwinds in the EV sector, we have been relentlessly working to raise capital, reduce our liabilities, preserve cash and provide excellent service for our customers.”
In December, Nikola wrote in a regulatory filing with the SEC: We currently estimate that our existing financial resources are only adequate to fund our forecasted operating costs and meet our obligations into, but not through, the first quarter of 2025.” In response to increasing financial difficulties, Nikola laid off 15 per cent of its workforce in October. Further redundancies were to follow in December – the extent of which was not made public.
Crash on the stock market
Following the publication of the Bloomberg report, Nikola’s shares fell to a record low yesterday. In the past 12 months, the company has lost 95 per cent of its value. Shortly after the IPO in 2020, Nikola was even valued higher than Ford on the stock exchange, but a scandal soon erupted that plunged Nikola into crisis: the founder and then CEO Trevor Milton was accused of making false statements about the company’s technology and was later convicted of fraud. Nikola is said to have only paid 45 million dollars as part of the 125 million dollar settlement, but has not yet collected the 165 million dollars in compensation it is entitled to from the ex-CEO.
To add to the list of problems, Nikola recalled all 209 battery-electric trucks sold in 2023 and temporarily halted sales after an investigation into fires found a defect in the battery packs.
Nikola currently has high hopes for fuel cell trucks. However, demand is low, also in view of the poorly developed infrastructure of hydrogen refuelling stations. In the third quarter of 2024, Nikola was still able to sell 88 hydrogen trucks, an increase of 22 per cent compared to the previous quarter. A total of 235 hydrogen trucks have been sold since the market launch at the end of 2023. The new plant near Phoenix is thus anything but working at full capacity.
The situation at Nikola could be even more serious than reported by Bloomberg. The usually well-informed Electrek editor-in-chief Fred Lambert writes on social media, citing insiders, that the departure of Nikola CEO Stephen Girsky is a done deal and that the insolvency application is already in the hands of the lawyers. More employees will thus loose their jobs. And insolvency administrators visited Nikola this week to evaluate the assets. However, these statements cannot be confirmed.
bloomberg.com, x.com (Fred Lambert)
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