Nikola (NASDAQ:NKLA) stock is rising higher on Tuesday after the electric vehicle (EV) company announced layoffs for 270 of its employees.
According to the EV company, these layoffs come as it looks to cut costs to better manage its cash. Of those jobs cut, 150 are from Nikola’s European division. The remaining 120 were from its locations in Phoenix, Arizona and Coolidge, Arizona.
With these new layoffs, Nikola expects to see a $50 million reduction in cash spent per year. The company says that this will see its cash use drop to below $400 million per year starting in 2024. This all comes amid a worsening economy that has some businesses tightening their operations, Reuters notes.
Michael Lohscheller, CEO of Nikola, said the following about the cost-cutting plans:
“Nikola has initiated a more focused business plan this quarter, concentrating on North America, zero-emission truck production, and our HYLA hydrogen business […] We are proactively managing costs and reducing expenses. We are streamlining operations, including our organizational structure, to efficiently execute our objectives.”
NKLA Stock Movement Today
Investors are reacting positively to today’s news with strong trading of NKLA stock. This has more than 40 million shares changing hands as of this writing. That’s closing in on the company’s daily average trading volume of about 42.5 million shares.
NKLA stock is up 3.4% as of Tuesday morning. However, the shares are down 44.5% since the start of the year.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
