Electric vehicle manufacturer Nikola Corp is considering a range of strategic options, including selling parts of its business or potentially the entire company, as it faces significant financial challenges, Bloomberg News reported on Thursday.
The company’s shares dropped 28% in late-afternoon trading following the report. Other possibilities under discussion include seeking partnerships or raising additional funds, the report said, citing sources familiar with the matter.
See also: Nikola Faces Financial Crisis, Warns of Inadequate Funds for 2025
Nikola has been grappling with mounting costs associated with scaling up production of its fuel-cell electric trucks. The company’s cash reserves fell dramatically to $198.3 million as of the end of September, down from $464.7 million at the close of the previous year.
The EV maker has experienced a sharp decline in its stock value, losing nearly 96% of its market capitalization in 2024. CEO Stephen Girsky, during an investor call in October, acknowledged the company’s efforts to secure funding, stating it was “actively talking to lots of potential different partners.”
The company’s financial pressures underscore the challenges faced by startups in the competitive and capital-intensive EV market. Nikola’s exploration of options reflects its urgent need to stabilize its operations and maintain investor confidence amid dwindling cash reserves.
