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Electric-truck maker Nikola laying off 270 employees

Published 06/16/2023, 04:25 PM
Updated 06/16/2023, 05:36 PM
© Reuters. FILE PHOTO: Logo of U.S. truckmaker Nikola is pictured at the IAA Transportation fair, which will open its doors to the public on September 20, 2022, in Hanover, Germany, September 19, 2022. REUTERS/Fabian Bimmer

(Reuters) - Nikola said on Friday it would lay off a total of 270 employees, as the electric-truck maker looks to cut costs and sharpen its focus on the North American marketplace.

Several firms have narrowed their focus on core markets after the U.S. Federal Reserve's monetary policy tightening created tough economic conditions and prompted a rethink.

Nikola is involved in a dispute with its founder and top shareholder Trevor Milton, who has called for a change in leadership and urged other investors to vote against the company's proposal to increase the number of shares it is allowed to issue.

Of the 270 employees impacted, 150 were supporting Nikola's European operations and 120 were based at its sites in Phoenix and Coolidge.

The decision would help Nikola reduce personnel-related cash spend by $50 million annually, the company said.

Annual cash usage for the company was expected to decrease to under $400 million by 2024, Nikola added.

© Reuters. FILE PHOTO: Logo of U.S. truckmaker Nikola is pictured at the IAA Transportation fair, which will open its doors to the public on September 20, 2022, in Hanover, Germany, September 19, 2022. REUTERS/Fabian Bimmer

Investors have been closely scrutinizing cash reserves at Nikola and other electric-vehicle makers amid fears slowing sales could push the companies to pursue more share disposals to raise funds.

Shares of the Phoenix-based automaker were up nearly 1% in trading after the bell. It closed 15% lower in the regular trading session.

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