Hydrogen-powered freight truck maker Nikola is considering bankruptcy filing as it explores financial restructuring options, reported The Wall Street Journal (WSJ) citing people familiar with the matter.
The US-based company is considering avenues such as a sale or reorganisation within bankruptcy proceedings.
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Nikola is working with a law firm and financial advisers on a possible Chapter 11 filing to protect itself from creditors during a cash crunch, reported Bloomberg citing sources familiar with the matter.
However, the sources said that the firm’s plans not final and could change.
This development comes as Nikola faces challenges in fundraising, with its cash balance reduced due to substantial losses on every unit sold.
Nikola acknowledged the evaluation of various strategies, including securing financing as part of its restructuring efforts.
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By GlobalDataPreviously, it was reported that Nikola was considering selling parts of its business or the entire company to stay afloat.
In late last month, Nikola was cited by the news agency as saying that the firm was working “relentlessly” to secure capital to avoid a sale of the company.
In October 2024, Nikola reported sales of 88 hydrogen-powered Class 8 electric trucks in the third quarter, aligning with its forecast of 80 to 100 fuel cell units.
For the first three quarters of 2024, the total number of hydrogen fuel cell trucks wholesaled by Nikola reached 200, with 235 units sold since the truck’s market launch in the last quarter of the previous year.
