Nikola’s long-awaited Badger pickup truck might never even see the light of day.
Nikola announced a $2 billion agreement with General Motors last month, providing GM an 11% stake in the electric truck startup and engineering, building, and homologating rights for the Badger electric pickup truck.
This arrangement would also provide financial benefits to the Detroit carmaker. However, the Badger seems to command the most attention here.
Meanwhile, industry insiders raised questions about GM’s EV trucks. They just launched the GMC Hummer EV, which tickled the public. Nevertheless, the manufacturer promptly replied that the Badger would not interfere with its operations.
With that being said, recent reports suggest that there might be some issues regarding the impending deal. A renegotiation of some terms might be in the cards, with GM being the flag-bearer.
Meanwhile, Nikola CEO Mark Russell stated that he still has plans if they don’t reach an agreement. Nikola’s filing with the SEC dictates the two companies to work out a settlement before December 3, 2020.
“We have the ability, and we have a base plan of doing it ourselves. If we have a partner, that just enables us to consider going faster and reducing the risk. We’ve proven that over the years that we are a partnership company when those things are available to us,” stated Russel.
However, Nikola was recently accused of fraud. Specifically, Hindenburg Research released a short-seller report where they accused the company of lying and misleading investors. Nikola shares dropped immediately by 50% and forced founder and then CEO Trevor Milton to resign.
Nikola’s shares have dipped a further 16% since, and the reason for that can be the Badger’s potential cancellation if the deal with General Motors or any other OEM doesn’t come through.
“The Badger is part of our discussions with GM. And we’ve been clear all along that we wouldn’t build a Badger without an OEM partner,” stated CEO Russel.
Nikola’s shares have dropped more than 70% since going public in June, making them more vulnerable in this deal.
Moreover, the company’s long-term plans have always included building hydrogen infrastructure. The Badger was just one of the models to be using it. Let’s see how everything pans out.
To be continued…