By Michael Dabaie
General Motors Co. has entered into a strategic partnership with electric-vehicle company Nikola Corp. to make a pickup truck.
As part of the deal, General Motors will receive 11% ownership of Nikola and the right to nominate one director.
Shares of Nikola rose roughly 31% in premarket trade Tuesday. Shares of GM rose 7.2%.
Nikola designs and makes battery-electric and hydrogen-electric vehicles, electric-vehicle drivetrains, vehicle components, energy-storage systems, and hydrogen station infrastructure. The partnership with GM will begin with the Nikola Badger electric pickup truck, the companies said.
As part of the deal, Nikola will use GM's Ultium battery system and Hydrotec fuel cell technology.
GM will engineer and manufacture the Nikola Badger, the companies said.
Nikola will exchange $2 billion in newly issued common stock for the in-kind services and access to General Motors' parts and components.
Nikola will be responsible for the sales and marketing for the Badger and will retain the Nikola Badger brand. Badger production is expected to start in late 2022.
Last month, Nikola said it secured an order for 2,500 electric garbage trucks from refuse giant Republic Services Inc.
Last year, Ford Motor Co. took a $500 million stake in electric-truck startup Rivian Automotive.