Nikola, the startup that sought to construct fleets of electrical heavy-duty vehicles, has filed for chapter and plans to close down.
The corporate, which filed for Chapter 11 chapter Wednesday, expects to promote all or most of its property in an effort to maximize worth for shareholders and guarantee an “orderly wind down of its companies,” a launch asserting the submitting mentioned. Nikola was based in 2015 and went public in 2020, one yr earlier than promoting its first electrical car.
Though traders with a watch on Tesla’s success initially confirmed enthusiasm for the Phoenix-based startup, inventory costs quickly started to plunge as doubts emerged concerning the viability of the corporate’s expertise.
Nikola’s troubles worsened when its founder, Trevor Milton, was convicted on fraud costs in October 2022 stemming from false and deceptive statements he made concerning the improvement of electrical and hydrogen-powered vehicles. Prosecutors mentioned Milton created a deceptive video of a hydrogen-powered semi truck prototype cruising alongside a flat street. To movie the video, prosecutors mentioned, the truck was towed to the highest of a hill and launched to mimic the looks of driving.
The corporate mentioned it has roughly $47 million in money available because it enters the chapter course of and plans to make use of a portion of the funds to proceed sure direct-to-consumer gross sales and assist operations for vehicles at present within the discipline.
Nikola manufactured each hydrogen-electric and battery-electric semi vehicles, and its fueling community has disbursed greater than 330 metric tons of hydrogen, mentioned Chief Government Steve Girsky.
“Nikola has taken vital steps to maneuver zero-emissions transportation ahead,” Girsky mentioned in an announcement. “Like different firms within the electrical car trade, we now have confronted varied market and macroeconomic components which have impacted our skill to function.”
Girsky took over as Nikola’s chief government in August 2023, changing into the corporate’s fourth chief in 4 years.
In keeping with the corporate’s most up-to-date quarterly report, the corporate shipped 90,000 automobiles within the three months that ended Sept. 30 final yr and posted a web lack of almost $200 million throughout that interval. That marked an enchancment over the greater than $425-million web loss the corporate registered in the identical interval the yr prior. Over the previous yr, traders have bailed on the corporate, sending its share value tumbling from a excessive of $31.20 in late March to nicely beneath a greenback this week.
In a chapter submitting, the corporate listed liabilities of between $1 billion and $10 billion and reported property of $500 million to $1 billion. The submitting mentioned the corporate owes cash to between 1,000 and 5,000 collectors.
Nikola is amongst a number of electrical car startups with formidable plans that failed to return to fruition. Lordstown Motors, an electrical pickup truck firm based in Ohio in 2018, filed for chapter in 2023 and was charged by the Securities and Change Fee for deceptive traders in 2024. Manhattan Seashore-based Fisker made electrical SUVs and convertibles earlier than submitting for chapter in June 2024.
A handful of EV makers are nonetheless attempting to stake out territory within the burgeoning trade, although none have had the widespread success of Elon Musk’s Tesla.
Rivian, the electrical pickup and SUV maker primarily based in Irvine, is at present buying and selling at round $14 per share. In February 2022, shares have been valued at greater than $60. The corporate has struggled to maintain up with manufacturing targets, however established a key partnership with Volkswagen final yr.
Lucid Motors, which set its sights on creating luxurious electrical automobiles starting in 2016, has additionally fallen wanting its gross sales and manufacturing targets.
