Nikola Signs MOU with General Motors

Rhea-AI Summary

Nikola Corporation (NASDAQ: NKLA) has signed a non-binding Memorandum of Understanding (MOU) with General Motors for a global supply agreement involving GM's Hydrotec fuel-cell technology in Nikola's Class 7 and Class 8 semi-trucks. This MOU replaces a previously announced transaction from September 2020. Nikola aims to test production-engineered prototypes by late 2021 and beta prototypes in early 2022. The agreement excludes GM's equity stake in Nikola and the Nikola Badger program. Nikola will refund prior deposits for the Badger.

Positive

• MOU with GM signals commitment to integrating advanced fuel-cell technology.
• Expected testing of prototypes offers potential for innovation in clean hydrogen trucking.

Negative

• MOU does not include an equity stake from GM, which may affect investor sentiment.
• Cancellation of the Nikola Badger program may limit product diversification.

PHOENIX, Nov. 30, 2020 /PRNewswire/ -- Nikola Corporation (NASDAQ: NKLA) today announced the signing of a non-binding Memorandum of Understanding ("MOU") with General Motors for a global supply agreement related to the integration of GM's Hydrotec fuel-cell system into Nikola's commercial semi-trucks. This supersedes and replaces the transaction announced on September 8, 2020.

Under the terms of the MOU, Nikola and GM will work together to integrate GM's Hydrotec fuel-cell technology into Nikola's Class 7 and Class 8 zero-emission semi-trucks for the medium- and long-haul trucking sectors. As previously announced, Nikola expects to begin testing production-engineered prototypes of its hydrogen fuel-cell powered trucks by the end of 2021, with testing for the beta prototypes expected to begin in the first half of 2022. In addition, Nikola and GM will discuss the potential for the utilization of GM's versatile Ultium battery system in Nikola's Class 7 and Class 8 vehicles.

"We are excited to take this important step with GM, which provides an opportunity to leverage the resources, strengths and talent of both companies," said Mark Russell, Chief Executive Officer of Nikola. "Heavy trucks remain our core business and we are 100% focused on hitting our development milestones to bring clean hydrogen and battery-electric commercial trucks to market. We believe fuel-cells will become increasingly important to the semi-truck market, as they are more efficient than gas or diesel and are lightweight compared to batteries for long hauls. By working with GM, we are reinforcing our companies' shared commitment to a zero-emission future."

The agreement between Nikola and GM is subject to negotiation and execution of definitive documentation acceptable to both parties. The MOU does not include the previously contemplated GM equity stake in Nikola or development of the Nikola Badger. As previously announced, the Nikola Badger program was dependent on an OEM partnership. Nikola will refund all previously submitted order deposits for the Nikola Badger.

About Nikola Corporation

Nikola Corporation is globally transforming the transportation industry. As a designer and manufacturer of zero-emission battery-electric and hydrogen-electric vehicles, electric vehicle drivetrains, vehicle components, energy storage systems, and hydrogen station infrastructure, Nikola is driven to revolutionize the economic and environmental impact of commerce as we know it today. Founded in 2015, Nikola Corporation is headquartered in Phoenix, Arizona. For more information, visit www.nikolamotor.com or Twitter @nikolamotor.

Forward Looking Statements

Certain statements included in this press release that are not historical facts are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," "should," "would," "plan," "predict," "potential," "seem," "seek," "future," "outlook," and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding Nikola's expectations regarding the terms and potential benefits of the MOU or a definitive agreement with GM; Nikola's expectations and timeline with respect to prototype and production and testing; the benefits of fuel-cell technology; and Nikola's beliefs with respect to the benefits of its zero-emissions vehicles. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Nikola's management and are not predictions of actual performance. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements, including but not limited to, the ability of Nikola and GM to enter into definitive documentation for a supply agreement and the terms of any such definitive documentation; the failure to realize the anticipated benefits of the MOU or any definitive agreement; general economic, financial, legal, political and business conditions and changes in domestic and foreign markets; the potential effects of COVID-19; the impact of judicial, regulatory or administrative proceedings to which Nikola is, or may become a party; risks related to the rollout of Nikola's business and the timing of expected business milestones; the effects of competition on Nikola's future business; the availability of capital; and the other risks discussed under the heading "Risk Factors" in Nikola's Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 and other reports and documents Nikola's files from time to time with the SEC. If any of these risks materialize or its assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. These forward-looking statements speak only as of the date hereof and Nikola specifically disclaims any obligation to update these forward-looking statements.

Media Contacts:

Nicole Rose
nicole.rose@nikolamotor.com
602-499-4795

Colleen Robar
crobar@robarpr.com
313-207-5960

 

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SOURCE Nikola Corporation

FAQ

What is the recent MOU signed by Nikola Corporation with GM about?

Nikola Corporation signed a non-binding MOU with General Motors for a global supply agreement to integrate GM's Hydrotec fuel-cell technology into Nikola's semi-trucks.

When is Nikola expected to begin testing its fuel-cell powered trucks?

Nikola expects to start testing production-engineered prototypes by late 2021 and beta prototypes in the first half of 2022.

What does the MOU with GM exclude?

The MOU does not include GM's previously contemplated equity stake in Nikola or the development of the Nikola Badger.

How does the MOU affect Nikola's product development?

The agreement reinforces Nikola's focus on zero-emission trucks and development milestones while impacting the cancellation of the Nikola Badger program.