- Startup Nikola has filed for Chapter 11 after failing to find financial help.
- The electric truck company was valued at $27 billion in 2020, making it more valuable than Ford.
- Founder Trevor Milton was hit with a four-year prison sentence in 2023 over fraud charges.
Nikola this week joined Fisker, Proterra, and Lordstown Motors in a rogues’ gallery of EV startups that have bitten the dust. The electric truck maker filed for Chapter 11 bankruptcy after running out of cash and failing to find a rescuer.
The Phoenix-based company has been on the skids for some time, struggling with weak demand, falling share prices, and the fallout of a scandal that resulted in its founder receiving a four-year jail term for fraud.
Related: Nikola Is In Trouble As EV Maker’s Stocks Tumble 95%
Nikola said it is looking to sell its assets, which it values at between $500 million and $1 billion. But court documents list its liabilities at $1-10 billion, Reuters reports.
“Like other companies in the electric vehicle industry, we have faced various market and macroeconomic factors that have impacted our ability to operate,” Nikola CEO Steve Girsky said in a statement.
“Unfortunately, our very best efforts have not been enough to overcome these significant challenges, and the Board has determined that Chapter 11 represents the best possible path forward under the circumstances for the Company and its stakeholders.”
It’s hard to believe that five years ago at the height of the crazy EV startup boom, this same company was more valuable than Ford. Nikola had a market capitalization of $27 billion in 2020 despite it never having sold a single vehicle and signed a multi-billion dollar deal with GM that was supposed to see the Detroit company taking an 11 percent stake, supply Nikola with battery and hydrogen tech, and build the startup’s Badger electric pickup.
The Badger should have had 906 hp (919 PS) and a range of 600 miles (966 km) in fuel-cell form (a straight EV was also planned) but it never made it to production. Nikola did get its large trucks out onto America’s roads, however, but not without a struggle. It produced its first electric rig in 2021 but soon encountered setbacks including vehicle fires that forced the company to announce a safety recall.
Nikola was also engulfed in scandal when founder Trevor Milton was found guilty of fraud for faking a video of one of the brand’s trucks driving under its own steam when it was really rolling down a hill. Milton additionally made fraudulent claims leading investors to believe the company was closer to production than was true.
