GM last week said it would take an 11 percent stake worth $2 billion in startup electric truckmaker Nikola under a partnership that calls for GM to engineer and build Nikola's Badger pickup and another vehicle using Ultium batteries.
Nikola will reimburse GM for up to $700 million of capital expenses for manufacturing capacity of up to 50,000 units per year of the initial two vehicles, according to a Nikola filing with the U.S. Securities and Exchange Commission.
That deal came days after GM and Honda revealed plans to form a North American alliance that could include sharing vehicle platforms in four core segments. The partnership would combine Honda's sedan clout and continued internal-combustion focus with GM's pickup and SUV strength and its commitment to electrification. It builds on an earlier agreement for GM to help develop two Ultium-powered EVs for Honda.
"There are some automakers that for strategic reasons haven't made EVs as much of a priority as GM has, and now they can rely on GM's expertise," said David Whiston, senior equity analyst for Morningstar.
Both deals were made possible in part by the $2.3 billion joint venture GM formed in late 2019 with LG Chem to mass-produce Ultium batteries near GM's former assembly plant in Lordstown, Ohio. The venture aims to have at least 1,100 employees and open by January 2022.
"We said with that platform we would be able to provide a wide range of EVs that would be profitable. The partnerships we have are additive to that," Barra said. "It's important that we have great partners that we know we can work with, that we can explore opportunities, brainstorm with each other, solve challenges in a win-win fashion."