- General
- November 30, 2020
- 4 minutes read
GM Scales Down Nikola Partnership
After having announced a partnership-in-the-works this September, the automaker General Motors (GM) has today formalized a revised partnership and signed…
After having announced a partnership-in-the-works this September, the automaker General Motors (GM) has today formalized a revised partnership and signed an official memorandum for a global supply agreement and integration of GM’s Hydrotec fuel-cell system into the electric carmaker Nikola’s commercial semi-trucks.
The newly-formed partnership is actually a scaled-down version of the previous partnership Nikola sought with GM that involved offering production services for Nikola’s vehicles in exchange for an 11% stake in the company that was then valued at $2.2 billion.
Since that time, Nikola’s stock has fallen hard due to issues including fraud allegations that led to the ouster of its founder Trevor Milton, whereas the value of that 11% stake now sums up to just about $900 million given its current (as of writing) $8.2 billion market cap. Even then, GM has revised its terms and is no longer taking an equity stake in Nikola under their partnership.
With the scaled-down partnership with GM, Nikola now says that it’ll issue deposit refunds and cancel production of its planned Nikola Badger pickup truck whose production was dependent on a partnership with another manufacturer.
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| The Nikola Badger never made it past CGI mode. Photo credit: Nikola |
GM will now only work with Nikola on its semi-trucks under the revised deal, whose announcement has actually sent Nikola’s shares more than 15% during trading on Monday.
Photo credit: Nikola
