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PHOENIX (Reuters) — Shares of Nikola Corp rose nearly 10% on Wednesday after a General Motors executive said the Detroit-based automaker still sees potential in a partnership with the electric and hydrogen truck startup, and is still discussing a deal.
"We are continuing discussions," GM President Mark Reuss said during a conference call with analysts.
A partnership with Nikola presents "a big opportunity for us" to bring fuel cell technology developed by GM and Honda to market in Class 7 and 8 commercial trucks, Reuss said.
GM and Nikola also are discussing a deal under which Nikola would pay GM to build its Badger electric pickup, Reuss said. GM and Nikola in September outlined a deal that would give GM emissions credits from sales of the Nikola Badger, as well as $750 million to fund tooling for production.
The credits could allow GM to continue to sell its highly profitable gasoline-burning pickup trucks and sport utility vehicles without regulatory penalties.
Nikola shares jumped in early trading Wednesday after Reuss made similar comments to CNBC.
The alliance announced in September included plans for GM to receive an 11% stake in Nikola, then worth about $2 billion, and payments up to $700 million for building the startup's Badger pickup.
Days after the deal was announced, short-seller Hindenburg Research released a scathing report that called Nikola a "fraud" and said its founder and then executive chairman Trevor Milton had made false claims about Nikola's proprietary technology.
(Reporting by Tiyashi Datta in Bengaluru and Joe White in Detroit; Editing by Ramakrishnan M. and Chris Reese)
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