Nikola Faces Financial Collapse as Bankruptcy Looms

The electric and hydrogen truck maker's stock plunges to record lows following reports of potential bankruptcy and ongoing financial struggles.

Nikola Corp.'s stock dropped over 34% in premarket trading, with reports suggesting the company is preparing for a potential bankruptcy filing.
The company is working with law firm Pillsbury Winthrop Shaw Pittman to explore restructuring options, including selling assets or the entire business.
Nikola's cash reserves have dwindled from $464.7 million at the end of 2023 to $198.3 million by September 2024, with a monthly burn rate of $30–$40 million.
The company has faced significant challenges since its 2020 SPAC merger, including fraud charges against its founder, massive losses per truck sold, and multiple stock splits to avoid Nasdaq delisting.
Nikola's struggles highlight broader challenges in the EV startup sector, where high production costs and slow market adoption strain financial sustainability.