It declared bankruptcy, culminating a long fall to the old darling of the industry, which faced weak sales and went through a series of CEOs after a scandal of fraud.
The company plans to settle its assets after filing a recovery request under chapter 11 in the US state of Delaware on Wednesday (19). In the court documents, she listed assets between $ 500 million and $ 1 billion, and liabilities between $ 1 billion and $ 10 billion.
The order ends the struggle of the electrical and hydrogen -powered truck manufacturer to deal with the decrease in cash, slow sales and the drop in stock price. THE Bloomberg He reported earlier this month that Nikola was exploring a possible bankruptcy request, as the company acknowledged that it was “working tirelessly to raise capital.”
Nikola’s shares plummeted 54% at 8 am on Wednesday, before regular negotiation in New York. The value of shares has lost 97% of its value in the last 12 months until Tuesday.
The company has undergone a tumultuous journey since it became public in 2020 through an agreement with a specific purpose acquisition company, with its actions firing in its early days. Soon after, the Bloomberg News He reported that founder Trevor Milton had exaggerated the capacity of Nikola’s debut truck. These allegations, along with a subsequent campaign of sellers to discover the company, led to Milton’s dismissal and, later, to their conviction for fraud charges.
In recent years, the company has faced cash flow problems, slow demand and executive turnover. which led her to temporarily interrupt sales.
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CEO Steve Girlsky, a former Morgan Stanley and executive General Motors, was leading a recent effort to raise money or find strategic alternatives, said the Bloomberg.
Sector in crisis
Nikola is the latest manufacturer to succumb to a difficult environment for electric vehicles, which are struggling to maintain traction due to high costs, irregular loading infrastructure and warm interest of customers.
Fisker declared bankruptcy under chapter 11 in June, while Canoo announced a bankruptcy request under chapter 7 on January 17-both companies, like Nikola, became public through reverse mergers with check companies blank during a wave of such listings by 2020. The Swedish Battery Manufacturer Northvolt requested US bankruptcy protection in November.
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With its bankruptcy request, Nikola is seeking permission to proceed with an auction and sale process, the company said in a statement. The company said it intends to fulfill its obligations with employees and has $ 47 million in cash.
Nikola’s market value reached the $ 29 billion peak in the days after the start of negotiations, but had fallen to less than $ 100 million before the request.
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