Nikola shares fall after EV maker recalls all of its battery-electric semitrucks following a fire
Shares of electric truck maker Nikola opened sharply lower Monday after the company announced a recall of all the battery-electric semitrucks it has made to date — 209 in total — after an investigation into a recent fire found a flaw. Shares were down about 11% in mid-morning trading Monday to roughly $1.75 each. The recalls do not affect Nikola’s latest model, a semitruck powered by a hydrogen fuel cell. Production of the fuel cell trucks began last month.
Nikola said late Friday that a third-party investigation found that a coolant leak inside a battery pack was likely responsible for a fire in a truck parked at the company’s Phoenix headquarters on June 23. That fire spread to other nearby trucks, destroying five. Nikola had originally suspected that the trucks were deliberately set on fire in an act of vandalism. It now believes that “foul play or other external factors were unlikely to have caused the incident,” it said in its Friday night statement.
A second truck used by the company’s engineering team had a similar battery-pack malfunction on Aug. 10, though the problem was caught before it became a major fire, Nikola said. Following the third-party report, Nikola’s own engineers determined that a component in the battery pack, manufactured by an outside supplier, is the likely culprit. It expects to have a repair available soon. The company is halting sales of its battery-electric trucks until the repair is available.
Nikola is remotely monitoring all of its battery-electric trucks for signs of a similar defect. Although the company said it believes the risk is low — only two battery packs out of over 3,100 made have had the problem, it noted — it advised operators that while they can continue to use the trucks, the trucks should be parked outside until the repair is made.