General Motors Company intends to cooperate with Nikola Corporation in the production of electric vehicles. The Detroit-based automotive giant will receive an eleven percent stake worth two billion dollars in the electric start-up from Phoenix.
General Motors Company and Nikola Corporation intend to cooperate on electric propulsion systems. According to a current agreement, which is to be signed at the end of September, General Motors will receive eleven per cent of the Nikola shares worth around two billion dollars as well as the right to appoint a member of the board of directors. In the future, General Motors’ fuel cell technology and battery systems will be used in Nikola vehicles. The exception to this would be heavy trucks for the European markets.
In return, Nikola will have access to the technological know-how of the automotive giant and will be supported in the manufacturing process by production materials and facilities. The cooperation will start with the production of the Nikola Badger and will cover the entire commercial vehicle production of the newcomer from Arizona.
Both companies expect the partnership to result in substantial savings and greater market penetration. The external impact of the alliance should also not be underestimated. While the Nikola start-up gains in professionalism and reliability through the partnership with General Motors, General Motors could benefit from Nikola’s innovative strength and visionary pioneering image.
Hyundai rejects cooperation
Not long ago, Trevor Milton, CEO of Nikola Corporation, was seeking hydrogen cooperation with Hyundai. However, this may have been hindered by the potential competition between the two companies in the commercial vehicle market. With General Motors, Nikola has now found a partner that is mainly active in the passenger car segment. This should not lead to critical overlaps in the target markets.
The fact that General Motors will become Nikola’s exclusive supplier of fuel cells for trucks only outside Europe is probably due to Nikola’s existing joint venture with Iveco and Fiat Power Train (FPT), the commercial vehicle and propulsion brands of CNH Industrial. Iveco’s production plant in Ulm is expected to produce the first battery electric Nikola Tre from 2021 and the fuel cell version of the heavy truck from 2023.
Nikola intends to present the Badger pickup truck to the public during the Nikola World 2020 event from 3 to 5 December. Series production is scheduled to start at the end of 2022 in cooperation with General Motors.