Arizona-based electric vehicle maker Nikola filed for Chapter 11 bankruptcy protection following financial struggles and difficulty finding investors.

Nikola filed for bankruptcy in the United States Bankruptcy Court for the District of Delaware on Wednesday. The battery-powered car maker filed a motion to seek approval to auction and sell its assets. Nikola has $47 million in cash to fund its bankruptcy process, implement the sale process, and exit bankruptcy, it said. 

Nikola is known for producing battery-electric and hydrogen fuel cell commercial trucks. As of October, Nikola said it had record sales of 88 fuel cell electric vehicles to its dealer network, up 22% from last quarter. The company said there was a 78% increase in its fuel cell electric fleet adoption.

“Like other companies in the electric vehicle industry, we have faced various market and macroeconomic factors that have impacted our ability to operate,” said Steve Girsky, the president and CEO of the company. 

“In recent months, we have taken numerous actions to raise capital, reduce our liabilities, clean up our balance sheet, and preserve cash to sustain our operations,” he added. “Unfortunately, our very best efforts have not been enough to overcome these significant challenges, and the Board has determined that Chapter 11 represents the best possible path forward under the circumstances for the Company and its stakeholders.” 

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A Chapter 11 bankruptcy is when a court supervises a process that allows a business or individual to reorganize its finances. Nikola said it plans to continue limited service and support operations for trucks on the road, including its hydrogen fueling operations, through the end of March. 

Nikola was a popular startup but has faced several challenges, including its founder Trevor Milton’s conviction in 2023 for misleading investors. The company was faulted for publishing a video of a prototype truck that appeared to be driving down a highway but was, in reality, a nonfunctioning Nikola rolled down a hill.