Nikola Corp., once hailed as a pioneer in hydrogen-powered and electric semi-trucks, has filed for bankruptcy, leaving many customers grappling with the fallout from the company’s collapse. Founded in 2014 by Trevor Milton, Nikola gained attention and raised more than $1 billion by promoting its hydrogen-powered Nikola One semi-truck as a revolutionary product. Milton claimed the company had secured more than 14,000 preorders and operated the largest hydrogen production facility in the Western Hemisphere. However, investigations later revealed that these assertions were misleading or outright false.
Federal prosecutors charged Milton with securities and wire fraud, accusing him of fabricating key aspects of Nikola’s business, including the functional status of the Nikola One prototype. He was convicted in 2023 and sentenced to four years in prison. The company also settled with the U.S. Securities and Exchange Commission, paying a $125 million fine. Despite Milton’s departure in 2020 and ongoing legal troubles, California’s Air Resources Board (CARB) allowed Nikola to participate in its Clean Truck and Bus Voucher Incentive Project in 2022, providing over $50 million in state subsidies to support the purchase of more than 166 Nikola electric and hydrogen trucks.
CARB officials defended their decision, stating Milton’s legal issues did not impact the eligibility or performance of Nikola vehicles under the program. A spokesperson noted that Nikola’s funded trucks represent a small fraction of the nearly 12,000 zero-emission vehicles deployed through the agency’s voucher program. Still, critics argue that the state agency and its nonprofit partner CALSTART failed to adequately vet Nikola’s technology and business practices before awarding such substantial funding.
Nate Anderson, founder of Hindenburg Research—the firm that initially exposed Nikola’s fraudulent claims—criticized California officials for their oversight. “If California officials couldn’t figure it out in 2022, they are obviously hopeless,” he said. Meanwhile, state Sen. Tony Strickland called for increased legislative oversight of zero-emission vehicle programs to prevent further misuse of public funds.
Nikola’s bankruptcy has left customers, many based in California, without warranties or reliable access to spare parts, complicating maintenance for vehicle owners. Hyroad Energy, a Texas-based company, acquired Nikola’s intellectual property and remaining inventory of unsold hydrogen trucks. While Hyroad has opened a maintenance facility in Fontana, California, and offers software updates and connectivity services, it has stated it is financially unfeasible to honor the original warranties issued by Nikola.
Owners like Jennie Abarca, who purchased Nikola trucks with state incentives as part of her commitment to reducing emissions, have been forced to navigate an uncertain future. “It’s actually an amazing vehicle,” she said of the electric Nikola Tre, though she lamented the company’s management and now plans to invest in Tesla Semis, citing concerns over Nikola’s reliability.
Milton received a pardon from former President Donald Trump in March 2025, shortly before a court moved to finalize restitution payments to defrauded investors. Milton has since sought to recover $70 million from Nikola’s bankruptcy estate, but a judge ruled that the pardon does not shield him from civil liability, placing his claims low on the creditor hierarchy.
Governor Gavin Newsom’s office criticized Milton’s pardon and emphasized that state funding to Nikola occurred after his departure. The governor’s office highlighted that the company’s marketing overstated its technological capabilities, which contributed to investor losses.
Despite the setbacks, environmental advocates emphasize the importance of zero-emission vehicle incentive programs in reducing pollution from heavy-duty trucking. They suggest that improving oversight and accountability, rather than dismantling these initiatives, remains essential to sustaining progress in clean transportation.