General Motors receives $2 billion stake in electric car company working on trucks

Company announces massive investment in Nikola

Nikola
Nikola

DETROITGeneral Motors is making a massive commitment to the future of electronic vehicles, receiving a $2 billion equity stake in Nikola, an electric car company working on trucks.

GM has the infrastructure for an electric truck, and so far, it’s planning two different brands. But the company is also hedging its bets in the electric vehicle space.

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The Nikola Badger is a drawing board pickup with creativity from the newly publicly traded company using famed electrical engineer Nikola Tesla’s first name. His last name is already claimed by another EV brand.

Monday night, the Badger didn’t have a parts supply chain or a factory to be build in, but that changed Tuesday.

It might seem odd for General Motors to build a supply an outside company, but Navigant auto analyst Sam Abuelsamid said partnering is the new way to go, saving money first and foremost.

“GM has a truck platform that is perfectly suited for what Nikola needs,” Abuelsamid said. “The platform they’re probably using for the GMC Hummer EV that’s coming out next year, as well as for Chevy products off the same platform.”

The Domestic Three don’t always do well on the coasts, where many electronic vehicle customers are likely to buy.

“They’re trying to get some of the technology into other vehicles and other brands -- particularly to customers interested in buying an EV -- might have more cachet with them with them than a GM brand,” Abuelsamid said.

Another unique note about Nikola: The company is working on hydrogen-powered electric trucks. GM has looked into that for years, but having access to this technology is a helpful corner of the deal.

Officials said the deal is supposed to last for 10 years.


About the Authors:

Rod Meloni is an Emmy Award-winning Business Editor on Local 4 News and a Certified Financial Planner™ Professional.

Derick is a Senior Web Producer for ClickOnDetroit and has been with Local 4 News since April 2013. Derick specializes in breaking news, crime and local sports.