Nikola (NKLA.O) has initiated a comprehensive response by recalling all previously delivered battery-powered electric trucks and halting sales due to a recent investigation that identified a coolant leak within a battery pack as the root cause behind recent fire incidents.
The investigation revealed that a total of 209 battery-powered electric trucks, distributed among dealers and customers, are subject to recall.
The company is actively reaching out to all affected parties to address the issue, as confirmed by a company spokesperson speaking to Reuters.
The investigation, carried out by an independent third-party investigator, was substantiated by a minor thermal event involving one battery pack on a stationary engineering-validation truck.
Fortunately, no injuries were reported. Nikola, in its statement, asserted that external factors or malicious intent were improbable causes for the incident.
The company is committed to rectifying the situation and has begun the process of finding a solution.
Nikola had launched the investigation back in June following fire outbreaks in its Phoenix, Arizona headquarters.
In a recent development, the company’s internal safety and engineering teams have pinpointed a specific supplier component within the battery pack that is likely responsible for the coolant leak leading to the fires.
Facing challenges with supply chain constraints and diminished demand, Nikola made the strategic decision to shift its focus towards manufacturing battery electric trucks on a made-to-order basis and concentrate on hydrogen fuel cell trucks instead.
This change in direction was accompanied by the appointment of Stephen Girsky, a former General Motors executive, as its new Chief Executive on August 4, marking the company’s fourth CEO in as many years.
Given the ongoing uncertainties surrounding its financial stability, Nikola expressed significant doubts about its ability to sustain operations for the upcoming year.
This is the third time since February that the company has voiced such concerns, as it awaits crucial additional capital to navigate the challenges it faces.
To ensure immediate safety, Nikola has advised both customers and dealers of its Tre battery electric trucks to take precautionary measures, including parking these vehicles outdoors.
This announcement impacted the company’s shares, causing a decline of up to 5.6% following the market’s close.