GM Abandons $2B Nikola Stake as Partnership Collapses
General Motors has officially withdrawn from its planned $2 billion investment in electric truck maker Nikola Corp., sending Nikola’s stock tumbling 25% in Monday trading. The failed deal marks a dramatic reversal from September’s high-profile partnership announcement.
Key Developments in the GM-Nikola Breakup
- New Agreement: GM signed a non-binding memorandum to supply Nikola with Hydrotec fuel cell systems instead of the original equity stake
- Badger Pickup Canceled: GM will no longer manufacture Nikola’s Badger fuel cell pickup truck
- Deposit Refunds: Nikola will return $6.9 million in customer deposits for the now-canceled Badger
- Stock Impact: Nikola shares (NKLA) fell nearly 25% following the announcement
Timeline of a Troubled Partnership
The GM-Nikola deal faced immediate skepticism after its September 8 announcement. Key events include:
- September 14: Hindenburg Research publishes fraud allegations against Nikola
- September 21: Founder Trevor Milton resigns as executive chairman
- November 30: GM officially withdraws from equity deal
“This revised agreement focuses on areas where we can most effectively work together,” said GM Executive VP Doug Parks, emphasizing the company’s commitment to zero-emission technology.
What’s Next for Nikola?
With the Badger program shelved, Nikola will concentrate on its core business:
- Commercial Trucks: Focusing on Class 7⁄8 zero-emission semi-trucks
- Fuel Cell Technology: Potential integration of GM’s Hydrotec systems
- Battery Supply: Ongoing discussions about GM Ultium battery systems
GM will engineer the Hydrotec fuel cell systems at its Michigan facilities in Pontiac and Warren, with production at the Brownstown battery plant. The new supplier relationship, if finalized, would operate on a “cost-plus” basis with Nikola funding the capital investment.
This development represents a significant setback for Nikola but preserves a potential technology partnership that could benefit both companies’ clean energy ambitions.
