The company that called itself the “global leader” in zero-emissions transportation, has filed for bankruptcy protection as it seeks to find a buyer for the former darling of Wall Street.
In 2020, electric trucking startup Nikola was valued at around $US30 billion, exceeding the market capitalisation of Ford Motor Company.
The company began making its core products – all-electric and fuel cell electric semi-trucks in 2022 – but has been mired in controversy ever since.
That same year its founder Trevor Milton was convicted for misleading investors about the Arizona-based company’s technology.
At his trial, prosecutors say a company video of a prototype truck appearing to be driven down a desert highway was actually a video of a nonfunctioning Nikola that had been rolled down a hill.
Steve Girsky moved from chairman to CEO in 2023 to keep the wheels turning. and by the third quarter of last year, Nikola had produced 600 of the promised vehicles, but many have been recalled due to defects, costing the automaker tens of millions of dollars.
Nikola filed for protection in a US bankruptcy court last week and in a statement said that it has also filed a motion seeking approval to pursue an auction and sale of the business.
Reports said Nikola is hoping to sell what remains of its whole business as early as April,
If it can’t find a buyer willing to take on the whole business, the company will pivot to selling off its assets in pieces in an attempt to satisfy more than US$1 billion in liabilities.
The company has about US$47 million in cash on hand.
Nikola Corp said it plans to to continue limited service and support operations for vehicles on the road, including fuelling operations through the end of March, subject to court approval. The company said that it will need to raise more funding to support those types of activities after that time.
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