It looks like it is further going downhill with American hydrogen truckmaker Nicola, following a The Wall Street Journal and Bloomberg report that the company is considering Chapter 11 to propose a plan of reorganization to keep its business alive and pay creditors over time.

Last week, Nicola (NASDAQ: NKLA) shares tumbled as much as 45% to 41 cents before markets opened in New York on Friday. A Nikola spokesperson told Bloomberg the company was “evaluating a variety of options, including financing, as part of a financial restructuring.”

Probability of bankruptcy 85%

The plans aren’t final and could change, but analysts like online investment management service Macroaxis estimate that Nikola Corp’s probability of going bankrupt is currently 85%.

Reports on Nikola’s fragile health have been constants in the history of the young start-up company that uses Nikola Tesla’s first name to develop class 8 heavy trucks running on hydrogen or batteries.

Eind december 2024 bevestigde het bedrijf een nieuwe ontslagronde en waarschuwde het bij de Amerikaanse Securities and Exchange Commission (SEC) dat het niet genoeg geld in kas heeft om de activiteiten tot het eerste kwartaal van 2025 voort te zetten.

In de SEC-statement verklaarde Nikola: “We schatten momenteel dat onze bestaande financiële middelen alleen toereikend zijn om onze voorspelde operationele kosten te financieren en aan onze verplichtingen te voldoen tot, maar niet tot, het eerste kwartaal van 2025”.”

Once valued more than Ford

Nikola's beurswaarde, ooit gewaardeerd op $34 miljard, meer dan Ford, is gekelderd tot ongeveer $100 miljoen. Het bedrijf verliest elk kwartaal ongeveer $200 miljoen - ongeveer evenveel als de kasreserves aan het einde van het derde kwartaal.

To stay afloat, Nikola recently secured $65 million through a deal with noteholders, which buys the company about one additional month of operating time.

Nikola vierde uiteindelijk de commerciële lancering van zijn elektrische vrachtwagen op waterstofcellen in zijn fabriek in Arizona in oktober 2023, meer dan een jaar na de aankondiging ervan en geconfronteerd met een schandaal waarbij de oprichter en CEO, Trevor Milton, moest aftreden.

Het sprookje van de waterstoftruckmaker burst like a soap bubble when short seller firm Hindenburg Research released a report accusing Nikola of being “an intricate fraud.” As a result, several investors gradually pulled out.

In March 2020, Nikola Corporation announced its plans to merge with VectoIQ Acquisition Corporation, an SPAC company run by former General Motors (GM) vice-chairman Stephen Girsky. 

Girsky became Nikola Corp’s fourth President and CEO after German automotive veteran and former Opel boss Michael Lohscheller quit after a few months in August 2023. He would resurface later as Polestar’s current CEO.

General Motors was one of the first to take an 11% share in Nikola, which was overvalued at around $13 billion in early August 2020 but estimated to be worth €2 billion at that time. But two days later, the Hindenburg report caused all hell to break loose. By September 12th, Nikola’s stock had fallen by 36%.

Veroordeeld voor vier rekeningen

The straw that breaks the camel’s back would be a Nikola One ‘hydrogen’ truck shown in a promotional video driving down a hill. This truck turned out to be a mock-up with no drive train at all. Ironically, it’s a perfect image of what’s happening to the company today. Nikola’s founder and then-CEO Trevor Milton’s ‘lies’ eventually brought hem neer.

He stepped down as CEO on September 21st and was convicted in October 2022 by a federal court for four fraud accounts during his tenure. Nicola Corporation itself got off scot-free.

But that couldn’t prevent big partners who hoped to make a buck with the promising start-up, making the best of a lousy job and pulling out as fast as possible.

BP started by dropping the intended partnership to build a network of hydrogen filling stations, followed by GM’s announcement to blow up the proposed billion-dollar equity deal they made in November 2020.

The romance between Iveco, the daughter of Industrial Vehicles Corporation, a Dutch-based Italian multinational transport vehicle manufacturing company, eindigde in een scheiding in Italy.

In May 2023, Iveco announced that it would assume full ownership of the joint venture in Ulm, Germany, it had with Iveco. Germany’s major technology and automotive parts supplier also pulled back from a deal with Nikola.