The founder is a convicted felon. Now Nikola Motors is facing bankruptcy, putting nearly 1,000 jobs at risk.
Nikola Motors has been insolvent several times. But the American truck brand still exists. However, it is said to be a few millimeters from bankruptcy with 1,000 jobs at risk.
According to financial media outlet Bloomberg, Nikola Motors is currently as close to bankruptcy as the company can get.
It was not more than three years ago that the brand's founder and former director Trevor Milton was convicted of fraud and sentenced to three years in prison.
And even though the founder, among other things, defrauded Nikola's own investors, the brand did not break its neck.
However, this is how it looks now. Bloomberg believes that Nikola Motors is in such dire need of a capital injection that a sale of parts of the company is probably the only way out.
On the stock market, the brand's value has plummeted so much that the company has lost 95 percent of its value in one year.
In October, the brand's current CEO Steve Girsky attempted to calm the situation by assuring that Nikola was talking to 'several potential partners'.
But these talks have apparently not yielded any rescue plan. At least not yet. And now the coffers are practically empty.
In October, Nikola management said that they could find enough money to survive at least the first quarter of 2025. And although it was not said directly, there is much evidence that this is the case. There are no more funds.
That said, the Americans are far from the first to have recently gone bankrupt in the automotive industry. Fisker Inc., also headquartered in the US, also couldn't get a passenger car business going.
Furthermore, Fisker shares became so worthless that trading in them was eventually suspended. This happened immediately before bankruptcy proceedings in the American legal system.
Today, an American leasing company has purchased Fisker's North American inventory of cars. A good 3,500 cars. But that's no guarantee of software updates or service for the private individuals who managed to throw money into a Fisker Ocean.
The spare parts for a Fisker Ocean are also outrageously expensive. Read more about it here. On the other hand, it's not just the car brands that are having a hard time.
On Thursday last week, a German subcontractor went bankrupt after 78 years.
The bankruptcy is due to the company's largest customer – gearbox giant ZF – having announced that it will save up to 44 billion kroner over the next five years. Read more about it here .
