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Nikola Corporation (Nasdaq: NKLA) has filed for Chapter 11 bankruptcy in the District of Delaware. The company is seeking to auction its assets while maintaining limited operations until March 2025. This move aims to address ongoing financial challenges and explore avenues to maximize stakeholder value.

Despite successfully raising $300 million in debt and equity offerings last December, Nikola’s financial position remains fragile, with cash reserves standing at approximately $47 million. The company plans to continue essential services, including support for its hydrogen fuel cell electric vehicles and HYLA fueling operations, during this period.

Steve Girsky, Nikola’s President and CEO, emphasized the company’s accomplishments in the zero-emissions field but acknowledged the difficulties posed by market and broader economic conditions.

Nikola to Sustain Core Functions Until March 2025

The bankruptcy filing is a result of Nikola’s ongoing financial difficulties. The company has been grappling with liquidity issues despite efforts to bolster its financial standing. The decision to file for bankruptcy and seek asset auctioning reflects a strategic move to navigate these challenges and potentially restructure the company.

By maintaining limited operations until March 2025, Nikola aims to sustain its core functions while exploring opportunities to enhance stakeholder value. The company’s leadership has highlighted both the achievements and the hurdles it faces, as it strives to remain a viable player in the competitive zero-emissions transportation market.

Nikola Stock Drops Over 50% in Premarket Trading

Nikola’s stock has experienced significant fluctuations amidst the company’s financial turbulence. As of February 18, 2025, the stock opened at $0.579 and reached a high of $0.874 during the day, before settling at $0.76. At the time of writing, the stock was trading at $0.38 in the premarket session, down over 50% from its previous close.

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