Electric trucking startup Nikola is hoping to sell what remains of its whole business as early as April, lawyers for the company told a judge Thursday during the first hearing of its bankruptcy case in Delaware. The lawyers claimed Nikola already has at least three interested buyers (who they did not name) and that the [β¦]
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Welcome back to TechCrunch Mobility β your central hub for news and insights on the future of transportation. Sign up here for free β just click TechCrunch Mobility! Fifteen years ago, I started writing about a little EV startup that was trying to survive even as others failed in the clean tech boom-and-bust cycle. Back [β¦]
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Another would-be Tesla rival has filed for bankruptcy, in the latest sign of how difficult it is to make money off electric vehicles.
Nikola, which makes electric and hydrogen trucks, on Wednesday said it had filed for Chapter 11 bankruptcy protection and would sell its assets amid a cash crunch.
Nikola rode a wave of enthusiasm for electric transportation when it went public in 2020 and at one point was worth in excess of $30 billion β more than Ford at that time.
Nikola struck a major deal with General Motors but was engulfed in crisis after its founder, Trevor Milton, was accused of misleading investors about Nikola's business and technology.
In 2020, the short-seller Hindenburg Research revealed a substantial short position in Nikola and published a scathing 15,000-word report saying it believed the EV maker was "an intricate fraud built on dozens of lies."
"We have never seen this level of deception at a public company, especially of this size," the report said.
It detailed a litany of allegations, including that a publicity video purporting to show a prototype of Nikola's electric truck driving along a road was actually shot by rolling the truck down a hill.
Milton resigned and was later sentenced to four years in prison. The Securities and Exchange Commission fined Nikola $125 million in 2021.
Nikola recovered somewhat, striking a deal last year to sell 100 trucks to a California logistics company and announcing in January that its updated battery-electric trucks had driven 1 million miles.
But the startup, which recalled its entire fleet of big rigs in 2023 after several battery fires, ultimately failed to commercialize its technology.
Nikola lost more than $200 million in the third quarter of 2024. In October, the company said it had only enough cash to last until the first quarter of this year.
"The transition EVs has been slower than all manufacturers anticipated, and when it comes to commercial vehicles, that's a really tough segment to break into," Sam Fiorani, an industry analyst at AutoForecast Solutions, told Business Insider.
Fiorani said heavy-duty trucks and semis of the kind Nikola was building have specific needs, including quick refueling and long ranges, making them a difficult product to bring to market.
Nikola is the latest once promising EV startup to run out of money as EV sales growth has slowed over the past year.
Fisker, once worth as much as $8 billion,Β filed for bankruptcy last JuneΒ after its Ocean SUV was plagued by production delays and software problems.
Canoo, an electric-van company that went public in 2020 through a special-purpose acquisition company, went the same way last month despite high-profile deals with NASA, Walmart, and the US Postal Service.
"Every investor 10 years ago was looking for the next Tesla," Fiorani said. "Venture capitalists were jumping into any EV startup and expecting them to pay off in five or 10 years."
Fiorani added that the arrival of higher interest rates shut off that supply of easy money.
"Keeping these companies financed takes more than just wishful thinking that someday they'll make money," Fiorani said.
Their failures show just how difficult β and expensive β it is to build a viable EV business from scratch, with companies spending enormous sums to build up production.
Only Tesla β which nearly went bankrupt several times over a period that its CEO, Elon Musk, has described as "production hell" β has been able to become profitable through selling EVs.
Musk's company now has the advantage of scale; Tesla was responsible for nearly half of EV sales in the US last year.
Even legacy automakers have struggled to make money on EVs. Ford lost $5 billion on its EV business last year, and the Detroit carmaker told investors it's likely to lose another $5 billion this year.
Other startups remain mired in what has been termed the EV "valley of death."
Rivian went public in 2021 at a valuation of $86 billion, but it lost about $39,000 on each vehicle it sold last quarter. As it burns through cash, it has sought funding fromΒ VolkswagenΒ and theΒ federal government.
Rivian
Losses at Lucid Motors widened to nearly $1 billion in the third quarter. It has relied on funding injections from its largest shareholder, Saudi Arabia's Public Investment Fund.
"It's a measure of how hard it is to make money and turn a successful business out of an automotive company, EV or otherwise," Fiorani said.
"In North America, we've seen one successful vehicle startup since World War II. Tesla is the only one that has turned a profit."
Hydrogen electric trucking startup Nikola Corp. filed for Chapter 11 bankruptcy protection Wednesday after it failed to find a buyer or secure additional funds to maintain operations.Β Nikola was once a Silicon Valley darling, valued at $30 billion in June 2020 after it went public through a special purpose acquisition merger. But a series of [β¦]
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When Hindenburg Research posts a blog on its website, it often means a companyβs final days are near. Today, that company is Hindenburg Research. Nate Anderson announced Wednesday he has shut down short-selling firm Hindenburg Research after a seven-year run issuing damning reports about high-profile companies, including many of the technology worldβs giants and buzzy [β¦]
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Nikola Corp., a producer of battery and hydrogen-electric trucks, has taken several steps to repay its debts and raise equity, including offering up to $100 million in a common stock sale.Β The beleaguered company is still dealing with the aftershocks of its founder, Trevor Milton, being convicted of fraud for making exaggerated claims about the [β¦]
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