General Motors is taking an 11 percent stake in electric truck startup Nikola, the companies announced on Tuesday. As part of the deal, GM will help Nikola engineer and manufacture its battery-electric and hydrogen fuel cell vehicles, including the Badger pickup truck.
Nikola, which went public through a “reverse merger” with a special acquisition company earlier this year, 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,” the companies announced. GM will also get to nominate one director to Nikola’s board.
GM will supply hydrogen fuel cells to Nikola for its Class 7 and Class 8 semi trucks. Nikola will remain an independent company and will be responsible for the sales and marketing of the Badger, which was first announced in February and will make its official debut in early December. Nikola says it expects to start production on the Badger in “late 2022” at an undetermined location.
Founded in 2015, Nikola set out to make zero-emission big rigs using hydrogen fuel cell technology. While a number of companies like Tesla, Daimler, Freightliner, and other established players and startups are working on all-electric trucks, Nikola is one of the only ones pursuing hydrogen-powered big rigs. However it gets done, though, switching big rigs over to zero-emission powertrains could help put a big dent into the pollution caused by the transportation sector.
The startup has developed three different trucks, with the last two aimed at mass production in the US and European markets. But the company has since developed versions of its trucks that are battery-powered, too, for companies that don’t need as much range as the hydrogen-powered versions provide.
Hydrogen-powered vehicles have never really caught on in the passenger car space because there’s been very little investment in the necessary infrastructure. Where companies like Tesla and multiple governments and clean energy groups have spent the last decade building out relatively vast networks of electric vehicle chargers, only a handful of hydrogen filling stations exist to date.
Nikola also wants to take the tech it’s developing for its big rigs and apply it to different form factors. Last year, the company showed off an electric personal watercraft and a four-wheeled electric off-road utility vehicle.
Meanwhile, GM is in the midst of a $20 billion pivot to an “all-electric future” that includes spending $2.2 billion to retrofit its first “fully-dedicated” electric vehicle assembly plant and the development of its modular battery-electric platform, Ultium. Recently, Wall Street investors have begun pressuring the automaker to spin off its EV business, which is estimated to be worth up to $100 billion.
Nikola will be responsible for the sales and marketing for the Badger and will retain the Nikola Badger brand. The Badger was first announced on February 10th, 2020, and it will make its public debut December 3rd–5th, 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.