Nikola sells battery assets to Mullen amid bankruptcy rumors
California-based EV-maker Mullen Automotive purchased more battery assets from Nikola Corporation, the company announced recently. Neither company disclosed the deal's financial terms, which included acquiring a high-volume standard battery chemistry production line and a vibration table for in-house laboratory testing.
This isn’t the first time Mullen has made such a move. In September 2023, it bought production assets from Nikola subsidiary Romeo Power. That $3.5 million deal included equipment, inventory, and intellectual property for high-volume EV battery pack and module production.
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Romeo Power battery packs were later found responsible for fires in Nikola’s battery-electric trucks, which the company recalled all 203 of in mid-2023. Since then, Nikola's leaders switched focus to hydrogen fuel cell electric trucks and suspended the production of new BEVs as they worked to re-fit the trucks and return them to customers.
Mullen intends to use the new assets at its battery production facility in Fullerton, California, as part of its effort to transition to American-made battery components. Last month, the company submitted a modified plan to the U.S. Department of Energy, seeking $55 million in matching funds to support its manufacturing capabilities.
The Mullen deal aligns with Nikola’s efforts to raise more cash amid bankruptcy rumors. Last October, CFO Tom Okray said the startup OEM had enough funding to survive into—but not through—the first quarter of 2025, as it burned through as much as $200 million a quarter.
Also in October, Nikola laid off approximately 15% of its workforce and conducted another round in December, although executives didn’t specify the extent of the second reduction. A December 9 filing by the company confirmed it planned to explore strategic partnerships and “issuing equity or debt securities […] licensing arrangements or obtaining credit from government or financial institutions” to raise the needed funds.
Things became more dire in late January as rumors that CEO Steve Girsky, who assumed the role in August 2023, had left the company. While that turned out inaccurate, other executives, including the head of battery operations and country chief of Canada, have departed. But executives aren’t giving up: In a recent statement to the Business Journal, Nikola said it had been “relentlessly working to raise capital, reduce our liabilities, preserve cash, and provide excellent service for our customers,” but that it was “evaluating options for its business.”
Those options, according to a Bloomberg article, could involve a partial or full sale of the business. As of writing, the company has not set a date for its Q4 and full-year 2024 earnings but ended Q3 with $198 million in cash remaining.
