Nikola posts wider third-quarter loss after recall, sales pause

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Italian truckmaker Iveco holds business presentation, in Turin

The new Nikola Battery Electric 3 truck exhibited during a news conference in Turin, Italy, July 13, 2022. REUTERS/Massimo Pinca/File Photo Acquire Licensing Rights

Nov 2 (Reuters) - Nikola (NKLA.O) posted a wider loss in the third quarter on Thursday, after the electric truck maker suspended sales and recalled its battery-electric heavy duty trucks.

Shares of the company, down more than 50% so far this year, rose about 2% in premarket trading.

Nikola in August recalled all the 209 battery-powered electric trucks that it had delivered and suspended sales after an investigation into recent fires found a coolant leak inside a battery pack as the cause.

Despite the Tre battery-electric truck being recalled, Nikola said it received orders for 47 vehicles from a dealer.

It said cost of the recall and repair is expected to be $61.8 million, which includes the cost to re-engineer, validate and retrofit trucks with an alternative battery solution.

Net loss for the quarter ended Sept. 30 stood at $425.8 million, compared with $236.2 million a year earlier.

Nikola said it shipped three battery-electric trucks in the third quarter, compared with 63 units in the same period last year.

The pause in production after announcing the recall is the second such move this year. The company had halted production in May to streamline its assembly line.

Its cash balance at the end of September rose to $362.9 million, up from $226.7 million in the prior three-month period.

Reporting by Akash Sriram in Bengaluru; Editing by Shilpi Majumdar

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