The Consensual Hallucination that drove the EV SPAC mania didn’t die with the EV SPACs; it moved on to other stocks.
By Wolf Richter for WOLF STREET.
Nikola, the “legendary” maker of fuel-cell electric and battery-electric class-8 trucks that had gone public in June 2020 via merger with a SPAC, finally filed for chapter 11 bankruptcy today, as long expected, and intends to liquidate by selling its assets through a bankruptcy auction. It’s “legendary” because:
- Founder and CEO Trevor Milton was sentenced to four years in the hoosegow for lying to investors about the company’s technology;
- It settled fraud charges with the SEC for $125 million;
- Its stock price had given it a valuation of over $28 billion shortly after it went public in a fantastic display of what we have come to call “consensual hallucination;”
- It has lost $3.36 billion since 2019 in ever larger annual increments, on essentially no revenues.
And this long show, produced so elaborately by this outfit, which still calls itself “a global leader in zero-emissions transportation and energy supply and infrastructure solutions,” is over. The stock has long been just about worthless, and became worth even less today, (-40%), to $0.46, adjusted for the 1-for-30 reverse stocks split in June 2024, where each 30 shares became 1 share:
The company today said that it has $47 million in cash on hand, down from $202 million at the end of Q3 on September 30. In Q3, it lost $200 million. For the three quarters in 2024 so far it lost $482 million. In 2023, it lost $800 million. Since 2019, it lost $3.34 billion. It was very good at producing huge losses, we can say that for sure.
As if to add some dry situational humor, in August 2022, Nikola, whose shares by then had already collapsed by 92% from their peak, acquired collapsed EV-battery maker Romeo, which was supplying batteries to Nikola. In the press release back then, Nikola said:
“Integrated commercial vehicle electrification platform is expected to lead to manufacturing excellence and expected annual cost savings of up to $350 million by 2026; reduce non-cell related battery pack costs by 30-40% by the end of 2023.”
You see, the outfit has never once run into a shortage of bullshit to dish out to investors. For the few companies that bought its trucks, Nikola will provide direct service through March 2025, so about another six weeks. And then maybe someone else can step in, please? In the press release today, it said:
“Subject to Court approval, the Company intends to continue certain limited directly provided (non-dealer) service and support operations for trucks currently in the field, including certain HYLA fueling operations through the end of March 2025. Thereafter, the Company will need one or more partners to support such activities.”
EV SPACS that are no longer twitching:
These EV SPACs we have amused ourselves with for the past four-plus years, as one after the other were inducted into our pantheon of Imploded Stocks, were born during the era of free money and what we’ve come to call consensual hallucination, and reality just didn’t matter. Then they started collapsing and filing for bankruptcy, one after the other.
Electric Last Mile Solutions filed for bankruptcy in June 2022, only 12 months after it had gone public via merger with a SPAC. This was kind of a record.
Proterra, which produced a few electric buses, filed for bankruptcy in April 2023, 25 months after having gone public via merger with a SPAC. It once had a market cap of nearly $4 billion.
Lordstown Motors, which tried to make electric pickups, filed for bankruptcy in June 2023, less than three years after it had gone public via merger with a SPAC, during which time it lied to investors to get more of their cash and stay alive.
Fisker filed for bankruptcy in June 2024. It had gone public via merger with a SPAC in October 2020 amid fake promises and ludicrous projections, and then burned $1 billion of investor cash to have some EVs manufactured by contract manufacturer Magna Steyr in Austria. CEO Henrik Fisker had already driven his predecessor company, Fisker Automotive, maker of the plug-in hybrid Fisker Karma, into bankruptcy in 2013.
Lion Electric, a Canadian company that made electric trucks and buses, filed for creditor protection in Canada and for chapter 15 bankruptcy in the US in December 2024. It had gone public in the US via merger with a SPAC in November 2020.
Canoo, which lately called itself a high-tech advanced mobility and energy company, filed for chapter 7 bankruptcy in January 2025 and shut down, four years after it had gone public via merger with a SPAC in late 2020. In 2024, it had joined the corporate exodus from California to Texas. It designed some electric vans but never sold any and died with zero revenues in Texas. But before it died, it bought some of the assets of bankrupt EV maker Arrival in the UK.
EV SPACs that are still twitching…
Faraday Future Intelligent Electric [FFIE] issued a bankruptcy warning in May 2024 and withdrew its production forecast. It had gone public via merger with a SPAC in July 2021. Among other things, it became legendary for imposing mega reverse stock splits: In August 2023, a 1-for-80 reverse split, where each 80 shares became one share; in February 2024, a 1-for-3 reverse split, and in August 2024 a 1-for-40 reverse split. In total, 9,600 shares became 1 share. These things are just a bad joke:
Mullen Automotive [MULN] had gone public via SPAC merger in November 2021, and has lost $2.1 billion since then, with no revenues to speak of, other than selling a few imported Chinese vehicles early on. In April 2022, short-seller Hindenburg Research came out with a report that said, “Mullen Is Among the Worst EV Hustles We’ve Seen in A Crowded Field of Contenders.” After some whoppers of reverse stock splits, including another one a week ago, which became effective on February 18, there’s essentially nothing left, and the whole thing is a joke.
VinFast Auto [VFS], a Vietnamese EV maker that’s part of the conglomerate VinGroup, went public in the US via merger with a SPAC in August 2023, with a minuscule float, and the shares of this misbegotten creature then exploded giving it briefly a market cap of over $230 billion. But two months later, the stock had plunged 92%, becoming one of our favorites in the pantheon of Imploded Stocks. They’re currently at $3.82, down 96% from the high. Its market cap has imploded from over $230 billion to a still ridiculous $9 billion.
Lucid Motors [LCID] went public via SPAC merger in 2021. Ayer Third Investment Co., an affiliate of Saudi Arabia’s Public Investment Fund, has invested $6.4 billion in Lucid, including $1 billion in March 2024, and owns 64% of it. Lucid has lost $10 billion since 2020, but it actually makes and sells higher-end EVs that are well regarded, and can be seen out in the wild.
Polestar [PSNY] went public via merger with a SPAC in June 2022 and started trading at $11, giving it a market cap of $23 billion. The stock is now at $0.21, down 98% from the peak. The company is majority owned and controlled by Chinese giant Geely, which had bought Volvo, which had bought a startup that became Polestar. All the vehicles were made in China until late 2024, when the company started manufacturing the Polestar 3 at its factory in South Carolina.
Rivian is not part of this lineup because it went public via classic IPO, not SPAC merger, in November 2021. In trying to ramp up mass-production, it has burned through many billions of dollars, but has three models – a pickup truck, an SUV, and a deliver van – that are well regarded and can be seen in the wild.
It started out with Amazon as one of its backers and huge customer for its commercial vans. It has now made a deal with Volkswagen that’s bringing in more cash. Today, shares [RIVN] trade at $14, down by 93% from its peak in November 2021.
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The post The Collapse of the EV SPACs: Nikola Joins EV SPAC Bankruptcy Lineup. Here Are Those Already Bankrupt, and Those Not Yet appeared first on Energy News Beat.
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