Shares of Nikola surged Tuesday after General Motors announced it’s taking an 11% stake in the electric truck maker and will produce its marquee hydrogen fuel cell electric pickup truck the Badger by the end of 2022.
Shortly before the opening bell, Nikola shares were up 30% and GM’s were 6% higher. Nikola shares had surged as much as 53% while GM’s jumped as much as 9.1% in the premarket trading.
GM is getting a $2 billion stake in Nikola and the right to nominate one board member in exchange for in-kind services. GM will also supply Nikola’s fuel cells globally, except Europe, for its class 7/8 truck. Phoenix-based Nikola specializes in building zero-emission semi trucks using battery or hydrogen fuel cell technology, but it recently introduced its Badger pickup truck for consumers.
“When we look at the opportunity to continue to leverage our technology — the Ultium battery platform system as well as the Hydrotec fuel cell technology — this is a wonderful validation of our technology, and then bringing our engineering and manufacturing expertise to the table,” GM CEO Mary Barra said in an interview on CNBC’s “Squawk Box.”
Barra emphasized the potential benefits for GM, which has seen pressure from Wall Street to spin off its electric vehicle business. It will extend beyond the Badger pickup truck to include Nikola’s semi trucks, too “so this is a huge growth opportunity for us,” she said.
Nikola Motor Company Badger pickup truck
Source: Nikola Motor Company
Appearing alongside Barra on “Squawk Box,” Nikola founder and Executive Chairman Trevor Milton said the partnership gives Nikola more than just a manufacturer. Nikola will also have access to GM’s validated parts as well as its Ultium battery technology and a multibillion dollar fuel-cell program.