Nikola Corporation and General Motors announced a strategic partnership Tuesday that provides the Detroit automaker an 11 percent ownership stake in Nikola and will enable the two businesses to move into broader markets with Hydrotec fuel cell and Ultium battery systems.
Nikola says the partnership begins with its Nikola Badger and carries cost reductions through Nikola’s programs, including: Nikola Badger, Nikola Tre, Nikola One, Nikola Two and NZT.As part of the agreement, Nikola will use GM’s Ultium battery system and Hydrotec fuel cell technology, representing a key commercialization milestone for General Motors.
“Nikola is one of the most innovative companies in the world. General Motors is one of the top engineering and manufacturing companies in the world. You couldn’t dream of a better partnership than this,” says Trevor Milton, Nikola founder and executive chairman. “By joining together, we get access to their validated parts for all of our programs, General Motors’ Ultium battery technology and a multi-billion dollar fuel cell program ready for production. Nikola immediately gets decades of supplier and manufacturing knowledge, validated and tested production-ready EV propulsion, world-class engineering and investor confidence.
“Most importantly, General Motors has a vested interest to see Nikola succeed. We made three promises to our stakeholders and have now fulfilled two out of three promises ahead of schedule.”
To complete the deal, Nikola will exchange $2 billion in newly issued common stock for the in-kind services and access to General Motors’ global safety-tested and validated parts and components. General Motors will be subject to a staged lock-up provision beginning in one year and ending in June 2025. General Motors will engineer, homologate, validate and manufacture the Nikola Badger battery electric and fuel cell versions.
“This strategic partnership with Nikola, an industry leading disrupter, continues the broader deployment of General Motors’ all-new Ultium battery and Hydrotec fuel cell systems,” says GM Chairman and CEO Mary Barra. “We are growing our presence in multiple high-volume EV segments while building scale to lower battery and fuel cell costs and increase profitability. In addition, applying General Motors’ electrified technology solutions to the heavy-duty class of commercial vehicles is another important step in fulfilling our vision of a zero-emissions future.”
The companies note the agreement also extends GM’s use of its fuel cell technology to the heavy-duty truck market and represents a high-volume commercialization of its leading Hydrotec fuel cell system and complements the company’s battery-electric propulsion. Fuel cells will become increasingly important to the heavy truck market because they are more efficient than gas or diesel, GM says. The company adds it also sees additional growth opportunities in multiple transportation, stationary and mobile-power end markets.
Development of GM’s battery technology is ongoing; the company’s Ultium battery technology roadmap includes silicon anodes and lithium metal anodes, which will improve vehicle range, affordability, and reduced dependence on rare and costly metals. It is already demonstrating automotive-grade durability and significantly higher energy density, the company says.
Nikola will be responsible for the sales and marketing for the Badger and will retain the Nikola Badger brand. The Badger was first announced in February and will make its public debut in December at Nikola World 2020 in Arizona. Badger production is expected to start in late 2022 at a location to be announced at a later date, Nikola says.