Nikola was once valued at $30 billion, beyond Ford|@nikolamotor|X
Electric- and hydrogen-powered truck maker Nikola filed for bankruptcy yesterday.
It is a steep fall for a green startup that was once valued at $30 billion, beyond Ford. The electric vehicle company also secured billions in funding from auto giants, including General Motors and Germany’s Bosch.
Nikola cited high manufacturing costs and the trucking industry’s reluctance to abandon diesel as the primary reasons for its failure. It reported producing just 235 hydrogen-electric trucks since 2023 before halting production to conserve money ahead of the bankruptcy filing.
What went down?
Nikola founder Trevor Milton falsely claimed the startup had a fully functional hydrogen-electric truck, securing billions in investment.
A September 2020 report from short-seller Hindenburg Research unveiled the fraud, noting instances where investors were shown a fake video of a Nikola prototype driving downhill. In reality, the truck had no powertrain and was just rolled down a slope with a hired actor as a driver.
The report exposed the company’s misleading claims, causing its stock to crash. Nikola has since lost $3.6 billion in capital and owes $97.7 million in debts. Milton left Nikola and was convicted of securities fraud in 2022, which he is appealing.
The company joins other failed EV startups like Fisker, Electric Last Mile Solutions and Lordstown Motors. Its downfall highlights broader challenges in the EV sector, including high production costs, limited infrastructure, and wavering investor enthusiasm for green tech.
Analysts say the US adoption rate of electric vehicles is on a downward trajectory. Big brands like Ford and GM still face challenges in EV profitability. Even market leader Tesla reported lower global sales in 2024.