- Annual cash usage expected to decrease to under $400M by 2024
- Reorganizing workforce around new areas of focus and eliminating non-essential spend
- Continuing to take actions geared toward optimizing and protecting ongoing operations
- Q3 launch of the hydrogen fuel cell electric truck on schedule
- HYLA hydrogen energy business making strong progress with multiple partnerships, first-mover infrastructure advantage
PHOENIX, June 16, 2023 /PRNewswire/ — Nikola Corporation (Nasdaq: NKLA), a global leader in zero-emissions transportation and energy supply and infrastructure solutions, via the HYLA brand, today announced a progress update on its business optimization efforts, which are expected to result in a marked decrease in cash spend and streamlining of operations.
“Nikola has initiated a more focused business plan this quarter, concentrating on North America, zero-emission truck production, and our HYLA hydrogen business,” said CEO Michael Lohscheller. “Our battery-electric truck is in the marketplace and performing well for our customers, and the hydrogen fuel cell electric truck will go into production in a matter of weeks. We are proactively managing costs and reducing expenses. We are streamlining operations, including our organizational structure, to efficiently execute our objectives.”
These actions are consistent with comments from the company’s first quarter earnings announcement, among others, including the following:
- Realigning cost structure and reducing cash use by reorganizing workforce and rationalizing spend in all areas of the business.
- Concentrating on the North American marketplace, including the planned sale of the company’s joint venture share to Iveco Group.
- Localizing the supply chain where possible, including transitioning battery manufacturing from Cypress, Calif. to the Nikola plant in Coolidge, Ariz., along with planned assembly of Bosch fuel cell power modules in Coolidge. Both actions are expected to reduce material cost of the trucks.
- Prioritizing a capital-efficient approach for the HYLA hydrogen energy infrastructure business, including a strategic partnership with Voltera to develop up to 50 hydrogen stations over the next five years.
- Focusing on launching the company’s Class 8 hydrogen fuel cell electric truck in Q3, which currently has 178 sales orders from 14 end customers.
- Optimizing production at the Coolidge, Ariz. manufacturing facility to accommodate Nikola’s battery-electric and hydrogen fuel cell electric trucks on one assembly line.
- Ongoing restructuring of legacy Romeo business and shut down of legacy Cypress operations.
In conjunction with these initiatives, Nikola conducted a thorough review of its organizational structure and made the difficult but strategic decision to reduce its headcount, which is expected to decrease personnel-related cash spend by more than $50M annually. The reduction affected roughly 150 team members across multiple sites who were previously supporting (in part or in full) the company’s European programs, as well as approximately 120 employees based predominately at the company’s Phoenix and Coolidge, Ariz. sites and previously announced actions from Cypress, Calif. Nikola is supporting those affected with transition assistance.
These decisions preserve 900 jobs and are intended to create a sustainable structure that matches the organization’s focus and positions the company for future growth.
ABOUT NIKOLA CORPORATION
Nikola Corporation is globally transforming the transportation industry. As a designer and manufacturer of zero-emission battery-electric and hydrogen-electric vehicles, electric vehicle drivetrains, vehicle components, energy storage systems, and hydrogen station infrastructure, via the HYLA brand, Nikola is driven to revolutionize the economic and environmental impact of commerce as we know it today. Founded in 2015, Nikola Corporation is headquartered in Phoenix, Arizona. For more information, visit www.nikolamotor.com , Facebook @nikolamotorcompany, Instagram @nikolamotorcompany, YouTube @nikolamotorcompany, LinkedIn @nikolamotorcompany or Twitter @nikolamotor.
This press release contains certain forward-looking statements within the meaning of federal securities laws with respect to Nikola Corporation (the “Company”), including statements relating to the Company’s expectations regarding actions it intends to implement to focus and streamline its business; the Company’s expectations regarding the benefits of actions taken and that may be taken in the future in furtherance of such efforts, including anticipated cost savings, cash usage levels, optimization and protection of ongoing operations and reduction of the bill of materials costs, creating a sustainable structure and positioning the Company for future growth, among others; the Company’s beliefs regarding its business milestones, and the expected timing and benefits thereof, including commencement of commercial production of its hydrogen fuel cell electric truck and the activities related to its planned hydrogen fueling infrastructure; and the Company’s beliefs regarding its competitive position and the benefits thereof. Forward-looking statements are predictions, projections, and other statements about future events based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: the success of the Company’s efforts to streamline its business; the ability of the Company to achieve anticipated benefits of these and other activities, including expected cost savings; the ability of the Company to access sufficient capital to meet its requirements and fund its business, including risks related to its ability to obtain stockholder approval of an increase in the Company’s authorized common stock; manufacturing delays and difficulties; risks related to the rollout of the Company’s hydrogen fueling infrastructure and the timing thereof; construction risks and delays; the level of and cancellation of customer orders; the ability of the Company to complete the disposition of its European joint venture and the timing thereof; risks associated with manufacturing batteries and fuel cell power modules; the Company’s ability to remain listed on Nasdaq; and the factors, risks and uncertainties described in the “Risk Factors” section of the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2023 filed with the SEC, in addition to the Company’s subsequent filings with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and, except as required by law, the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
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SOURCE Nikola Corporation