GM to Manufacturer Electric Pickup for Nikola

General Motors has invested $2 billion into electric vehicle startup Nikola Motor Company. As a result, Nikola vehicles will use GM’s Ultium battery technology and GM will manufacture the Badger, an electric pickup truck.

Previous reports had suggested that Nikola would partner up with Chrysler, but GM has stepped in to take the startup on.

“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,” said Mary Barra, GM CEO. “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.”

The tie-up will also have implications for Nikola’s electric semi trucks. Not only will this be an avenue for GM’s electric technology, but its hydrogen fuel-cell technology, too.

“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,” said Barra.

The investment has earned GM an 11% stake in Nikola. Along with a customer for its electric and fuel cell technologies, GM will likely get preferential access to Nikola’s “regulatory credits.”

These credits are what kept Telsa afloat for years. The credits are given to companies by state and federal governments for zero-emissions vehicles. These credits can then be sold to traditional manufacturers, which can use them to meet manufacturer emissions requirements.

So as GM continues to churn out Sierras and Silverados, they won’t need to worry about making them as fuel-efficient thanks to a stream of cheap regulatory credits rolling in form Nikola—or at least that’s the suggestion.

Nikola, meanwhile, gets access to GM technology, engineering, validation, and homologation. From the engineering and validation help alone, it expects to save $1 billion. And it expects to save a further $4 billion in battery and powertrain development costs.

This partnership with Nikola follows a memorandum of understanding struck with Honda to share electric and fuel cell technology. These will be important to GM’s accounting teams since mass production will be crucial to help GM pay for the R&D that went into these new technologies.

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