Written by Cláudio Afonso | LinkedIn | X
Electric truck maker Nikola filed its latest quarterly recall report earlier this week with the U.S. National Highway Traffic Safety Administration (NHTSA), but questions have arisen over whether its reported recall figures align with cumulative reporting requirements.
In August 2023, the company founded by Trevor Milton recalled all its 209 battery-electric trucks sold to date due to a battery fire risk.
According to NHTSA regulations, specifically 49 CFR § 573.7(b)(4), manufacturers are required to submit quarterly reports that cumulatively detail the number of vehicles or equipment items that have been fixed.
“Information supplied in response to the paragraphs (b)(4) and (5) of this section shall be cumulative totals,” according to the official Electronic Code of Federal Regulations (eCFR) website, maintained by the U.S. Government Publishing Office (GPO).
This means the “Total Remedied” figures in these reports should reflect the aggregate number of vehicles fixed to date rather than just those repaired in a given quarter.
However, Nikola appeared to contradict this requirement in a post on X on Tuesday, stating that “111 recalled BEVs have been returned to the market,” implying the numbers reported in its Q4 2024 recall filing were not cumulative.
“Thanks to all the members of the Nikola team that have been working hard to get these back on the road for our end fleets,” the Phoenix-based startup added in the post.
If Nikola’s claim is correct, it raises questions about earlier statements made by the company in the third quarter 2024 press release and confirmed later in the conference call by CFO Tom Okray. On October 31, 2024, Okray stated:
“In terms of the actual recall, we’ve returned 78 trucks as the prepared remarks said.” Considering NHTSA reporting requirements, Nikola had fixed 37 trucks of the 209 recalled in 2023 — as of September 30, 2024.
“And we’ve got another 81 trucks in the recall that are pending. In addition to that, we’ve got almost 150, which is in Nikola’s inventory and not part of the recall,” Okray added.
Giving Nikola‘s X post on Tuesday, the company claims it had recalled 71 trucks by the end of Q3 and 111 trucks by the end of last year. Even considering Nikola’s calculations, the company fixed about 53% of the recalled trucks in more than 500 days.
The company claims that it has fixed 71 trucks as of September 30, 2024: one in Q1 2024, 33 in Q2 and 37 in the third quarter of last year.
As seen in another recall report, the number of “Total Remedied” vehicles should always be reported as cumulative.
Using an example from Ford Motor Co., in a recall that affected 5,456 vehicles, the total remedied vehicles were reported cumulatively. Given that the recall affected less than 6,000 units, the number of the last two reports would already surpass the total recall population.
Nikola’s stock hit an all-time low of $0.71 earlier this week and jumped 10.1% on Tuesday to $0.79.
Last October, the company’s chief financial officer Tom Okray stated that the company had a cash runway of “five to six months,” with a monthly burn rate of $30 million to $40 million.
Last week, the California-based EV startup Mullen Automotive said it acquired a high-volume standard battery chemistry production line and an electro-dynamic shaker system from struggling truck maker Nikola. The companies did not disclose the terms of the deal.
Nikola, based in Phoenix, has been exploring strategic options, including a potential sale, partnerships, or raising additional capital, Bloomberg reported last week, citing people familiar with the matter.
