Nikola Motor, the once-promising electric vehicle (EV) manufacturer, has filed for Chapter 11 bankruptcy protection. The announcement comes months after the company warned it would likely run out of cash early this year.
Nikola was once valued at $30 billion, surpassing the market capitalization of Ford Motor Co., but is now struggling to stay afloat with only $47 million in cash reserves.
Rise and Fall of Nikola Motor
Founded in a Utah basement, Nikola Motor initially gained recognition as an industry disruptor.
The Arizona-based company was a Wall Street favorite before becoming embroiled in scandal. The downfall began with a 2020 report from short-selling firm Hindenburg Research, which accused Nikola of fraud.
The report led to an investigation by the Securities and Exchange Commission (SEC), unraveling a chain of events that resulted in the resignation and arrest of the company’s founder and CEO, Trevor Milton.
Fraud Allegations and Founder’s Conviction
Trevor Milton stepped down amid fraud allegations, and Nikola’s stock price plummeted. Investors suffered heavy losses as reports questioned Milton’s claims that the company had already produced fully operational zero-emission 18-wheel trucks.
