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Struggling Electric-Truck Maker Nikola Makes a Major Change

Electric-truck manufacturer Nikola, like the broad vehicle industry, has been struggling with supply-chain issues.
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Nikola (NKLA) , the electric- and hydrogen-truck producer, is making a change and not just any change. 

The company, which says it is "driven to revolutionize the economic and environmental impact of commerce as we know it today," has once again taken an important decision to reinforce its credibility with investors.

Chief Executive Mark Russell will step down on Jan. 1 and will be succeeded by Michael Lohscheller, who joined Nikola last February, a recent news release says.

Lohscheller will also join the board immediately and Russell will remain a director.

Third CEO in Less Than Three Years

Lorscheller is a 20-year veteran of the auto industry. He notably was CEO of the German brand Opel -- which until 2017 was a subsidiary of General Motors  (GM) . At Opel, he supervised the company's transition to electrification. 

And according to Nikola, in his six months as Russell's lieutenant, he performed impressively.

"In his six months since joining our company, Michael has continued to bring an increased sense of urgency, high level of accountability, improved lines of communication and accelerated decision-making to Nikola Motor," Nikola Chairman Steve Girsky said. 

"We believe that same standard of excellence and operational and commercial expertise will benefit the company's vehicle and energy infrastructure vision."

Lorscheller is Nikola's third CEO in less than three years.

This change comes as Nikola tries to deal with supply-chain issues that are holding back the production of its semi trucks. 

The covid-19 pandemic has completely disrupted supply chains, resulting in a shortage of chips and other parts needed to assemble vehicles. Russia's war in Ukraine also contributed to soaring raw-material prices, which increased all auto makers' production costs.

But one of the problems also affecting Nikola the most is a management crisis. Trevor Milton, the founder, was indicted in 2021 and accused of lying and misleading investors. This scandal had led to his departure: He was succeeded by Russell in June 2020. 

Russell then had the difficult mission of stabilizing the company. And he downgraded Nikola's ambitions.

"On behalf of our board and management team, we want to thank Mark for navigating Nikola through a critical chapter and playing a key role in positioning us for our next phase of growth," Girsky said.

Former GM Executives at the Helm

With the posting of Lorscheller as CEO, Nikola is now run by GM alumni. 

Indeed, Girsky was the president of the European arm of General Motors when Lohscheller ran Opel.

The company produces Tre battery-electric trucks. And it is also developing a hydrogen-fuel-cell electric semi truck, the Tre FCEV, with a range of as much as 500 miles and a refuel time of under 20 minutes. That configuration would enable it to carry freight over longer distances. 

The start of regular production of the Tre FCEV is scheduled for the second half of 2023.

In the second quarter, Nikola produced 50 Nikola Tre BEVs and delivered 48 of those to dealers. The figures were mixed as the company foresees 50 to 60 units to be produced and 50 to 60 Tre Bevs to be delivered.

The electric truck maker also raised $200 million. It had $842 million in cash at the end of the second quarter, up from $794 million at the end of Q1.

Since the release of the second-quarter results on Aug. 4, Nikola shares are down about 16%. The shares are down 32% since January.

The company, which was founded in 2014, went public in May 2021 by merging with a special-purpose-acquisition company, or SPAC.