Shares of Nikola Corporation have crashed nearly 40% after rumors of potential bankruptcy emerged. This alarming drop raises serious questions about the company's future and the health of the electric vehicle market.

Founded in 2020, Nikola aimed to revolutionize transportation with innovative hydrogen and electric trucks. However, controversies and fraud accusations led to financial ruin, marking a drastic fall from its peak stock prices.

Nikola is reportedly working with law firm Pillsbury Winthrop to explore restructuring options. The carmaker struggles with dwindling cash and climbing costs, leading to a rapid sell-off of its shares.

The potential bankruptcy of Nikola not only impacts its stock but also shakes investor confidence across the EV industry. Sudden volatility could hinder investment in emerging companies, risking innovation.

If bankruptcy occurs, significant job losses are probable, impacting Nikola’s employees and related business sectors. The ripple effects could extend to local economies, creating broader economic challenges.

While some defend Nikola's hydrogen fuel tech potential, critics cite flawed business models and past controversies as warning signs. The debate continues about the viability and future of their innovations.

Nikola faces critical potential outcomes, including restructuring or complete bankruptcy. Each scenario could reshape their operations and influence the larger EV industry's future landscape.