GM inks partnership deal with EV startup
GM has acquired 11% in EV and hydrogen vehicle startup Nikola in exchange for which it will supply the company with know-how and technology.
Alexis Benveniste reported the news for CNN:
General Motors and Nikola are teaming up to work on the Nikola Badger, a fully electric and hydrogen fuel cell electric pickup truck.
The partnership gives General Motors (GM) an 11% stake in the startup, receiving $2 billion in equity, the companies said in a news release. GM will also get the right to nominate one director to Nikola’s board.
Nikola shares rose more than 33% in morning trading Tuesday on the news.
General Motors will be the exclusive supplier of fuel cells to Nikola’s (NKLA) Class 7/8 trucks in all areas besides Europe, the companies said.
The Wall Street Journal’s Mike Colias noted:
General Motors Co. GM 7.93% ’s shares jumped after the auto maker said it would help an electric-truck startup develop and manufacture new models, the latest example of investor infatuation with electric vehicles.
The deal marks the latest tie-up between traditional auto makers and upstarts trying to break into the car business, and showcases GM’s strategy of providing its electric-vehicle technology to others.
Kalea Hall from the Detroit News wrote:
GM is pressing ahead with its electric vehicle programs and is looking to use the technologies outside of its own portfolio to share the cost of developing the expensive programs. GM, which last week announced an expanded partnership with Honda Motor Co., isn’t alone in forming alliances to help with cost: Ford Motor Co. has partnered with Nikola competitor Rivian Automotive LLC and Volkswagen AG. Fiat Chrysler Automobiles NV is merging with Groupe PSA of France to form a new company named Stellantis.