Nikola Laying Off 270 Workers To Lower Prices, Sharpen Focus On North America

Electrical automobile startup Nikola Motor mentioned on Friday it might lay off a complete of 270 workers throughout its European and US operations. 

The corporate motivated the layoffs by the necessity to reduce prices and sharpen its concentrate on the North American market – it has already introduced plans to promote its European three way partnership share to Iveco Group. Of the 270 workers impacted by the choice, 150 have been supporting Nikola’s European operations and 120 have been primarily based at its Arizona websites in Phoenix and Coolidge.

Nikola mentioned it’s supporting these affected with transition help, however didn’t elaborate on what which means. 

“Nikola performed an intensive assessment of its organizational construction and made the troublesome however strategic choice to cut back its headcount,” the corporate mentioned in a press launch, including that it is now “reorganizing workforce round new areas of focus and eliminating non-essential spend.”

The truck maker famous that these choices will assist protect 900 jobs and place the corporate for future development by serving to it reduce personnel-related money spend by $50 million yearly. Moreover, complete annual money utilization anticipated to lower to beneath $400 million by 2024.

Nikola additionally reiterated that the Q3 launch of the Tre FCEV Class 8 hydrogen gas cell electrical truck stays on schedule. The corporate says it presently has 178 gross sales orders from 14 finish prospects.

The announcement is the newest setback Nikola is going through after struggling in current months with a Tre BEV supply shortfall, government turnover, and a slumping inventory worth that has led to a doable inventory delisting.

Shares in Nikola fell 15 % to shut on June 16 at $1.19, getting shut ot the minimal $1.00 closing bid worth requirement.

In line with the foundations, if an organization trades for 30 consecutive enterprise days under that threshold, Nasdaq will ship a deficiency discover to the corporate advising it that’s has been afforded a “compliance interval” of 180 calendar days to regain compliance with the relevant necessities. Nikola acquired such a discover in Could 2023.

Satirically, Nikola founder Trevor Milton, who was convicted of securities fraud final yr, criticized the corporate on social media saying it wanted new management. He owns 50 million Nikola shares, about 9 % of the corporate’s shares excellent.