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Nikola Corp electric van Maker. Placed Wednesday for the protection against the bankruptcy of chapter 11 after the company did not overcome the challenges of the market and macroeconomics.
“Like other companies in the electric vehicle industry, we had to face various market and macroeconomic factors that have had an impact on our ability to work,” CEO Steve Girsky said.
Girsky said that the company had taken “many measures” to increase capital, reduce liabilities, clean its balance sheet and preserve money to maintain operations in recent months, but it was not enough to overcome The “important challenges” with which the company had been confronted. He said that the balance sheet protection was the “best possible” for the company and its stakeholders.
Former car leaders warn that the thrust of the electric vehicle occurred “too early and too fast”
On Wednesday, Nikola has around $ 47 million in cash to keep things on the way as he tries to sell assets and reorganize. The company also requests the approval of the court to sell its assets quickly to ensure that it has enough money to cover the costs during The bankruptcy process.
The first two zero-emissions electric trucks, an order of 100 vehicles, delivered Nikola Corp. to total transport. (Brittany Murray / Medianews Group / Long Beach Press-Telegram via Getty Images) / Getty Images)
It was not fluid for the company, which became public in 2020 and, in a short time, trained a strategic partnership with General Motors in which the automaker in Detroit received a participation of $ 2 billion in Nikola.
The founder Trevor Milton, who resigned in 2020, was sentenced to four years in prison in 2023 for initiating titles and a fraud in wire within the framework of a program of fraud and infinity of investors on the development of Products and technologies in Nikola, according to prosecutors.
In 2023, the company recalled hundreds of its trucks with a big rigand and interrupted other sales after discovering that a leak of cooling liquid inside a single battery turned out to be the Probable cause of the truck fire at the company’s headquarters in Phoenix in June this year.
EV Maker deposits bankruptcy after hemorrhage
In addition to the low demand and operational challenges, the company experienced a rapid turnover within its C. three different CEOs took over within two years. Girsky took the helm in August 2023, but even under its leaders, the capital of the company decreased quickly.
| Teleprinter | Security | Last | Change | Change % |
|---|---|---|---|---|
| Nkla | Nikola Corp. | 0.47 | -0.30 |
-38.63% |
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“We are examining all opportunities to optimize species,” said Girsky when calling the company’s third quarter in October. He considered that the company had only enough liquidity to finance its expected operating costs and comply with its obligations until the first quarter of exercise of 2025.
Its stock has plunged more than 70% over a year to date.
A thick electric Nikola Tre-Electric truck at the Coentreprise Nikola Corp.-Iteco Spa electric truck plant in Germany, Wednesday September 15, 2021. (Andreas Gebert / Bloomberg via Getty Images / Getty Images)
“The electric vehicle industry has continued to fight in a context of increasing competition, operational challenges and high costs, leading most electric vehicle manufacturers who turn to Chapter 11 to turn to a sale of assets , or even a liquidation, rather than a reorganization of the company “, Sarah Foss, head of law in Debtwire, told Fox Business.
Foss said that Nikola followed a similar path of bankruptcy, like the Fisker startup, which used its bankruptcy of June 2024 to sell its assets, and Lordstown Motor, which sold the majority of its assets to a vehicle ‘Old CEO of the company, and Proterra, which sold its business sectors during its bankruptcy in August 2023.
