EV truck maker Nikola to pull the plug on battery supplier Romeo

Nu Ride

03/07/2023 23:19

July 3 (Reuters) - Nikola Corp  NKLA.O  will start
liquidating the assets of battery maker Romeo Power, the
electric truck maker said on Monday, less than a year after
buying it.
    The company, which went public in 2020, has struggled to
keep up with high expectations of early investors, amid inflated
costs of commodities and tight access to capital over the past
year.
    Nikola in August agreed to buy Romeo Power for about $144
million in stock, as it looked to jump-start efforts to make
battery packs.
    "Nikola is discontinuing its operations with Romeo Power and
has commenced a proceeding under the California Assignment for
the Benefit of Creditors (ABC) statutory scheme," a company
spokesperson said in a statement on Monday.
    Nikola's struggles mirror those at many other EV startups.
British EV van maker Arrival  ARVL.O  earlier in the day said it
planned to terminate its merger with a blank-check firm, while
Lordstown Motors  RIDE.O  last week announced filing for
bankruptcy.
    In contrast, market leader Tesla  TSLA.O  topped market
expectations for second-quarter deliveries, after price cuts and
U.S. federal credits helped make its electric vehicles more
affordable.
    Romeo Power is one of the battery suppliers for Nikola's
prototype electric trucks along with LG Energy Solution
 373220.KS  and Proterra Inc  PTRA.O .
    
    

 (Reporting by Nathan Gomes and Akash Sriram in Bengaluru;
Editing by Sriraj Kalluvila)
 ((Nathan.Gomes@thomsonreuters.com;))