Nikola (NKLA) stock price crashed by more than 9% after a judge sentenced Trevor Milton to four years in jail. The sentence closed a dark chapter in Nikola’s history as the management attempts to turn around the company.

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Its stock has plunged by more than 99% from its highest level on record, giving it a market cap of over $949 million.

Dark chapter closes

Nikola Corporation closed a difficult chapter on Monday after a judge sentenced Trevor Milton to four years in jail. Prosecutors had requested eleven years, comparing his crime to that of Elizabeth Holmes. 

The ruling completes the downfall of Milton, who established the company a few years ago. As he prepares to go to prison, there is a blurry vision about the future of Nikola as concerns about its operations continues. Its stock has lost billions in value in the past few years and its future is uncertain, as I warned here.

Nikola is facing several challenges. The biggest one is that there are concerns about the future of hydrogen trucks because of their prohibitive costs. A hydrogen truck sells for about $450k, thrice what a typical diesel truck costs.

Nikola ended the last quarter with 277 non-binding orders from 35 customers, most of them in California. It is too early to predict how this orderbook will continue growing as the state bans diesel trucks in California ports.

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