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GM announces two new major partnerships: Honda and Nikola

Updated  September 9, 2020 12:20am EDT
General Motors
FOX 2 Detroit

(FOX 2) - General Motors made two distinct moves recently, announcing it is teaming up with Honda to make cars they'll both be able to sell, and that it's teaming up with the startup Nikola Motor to build an electric pickup truck. 

The alliance allows Nikola to build a vehicle while using GM's factory.

GM to make electric vehicles, supply batteries for Nikola

General Motors formed its second major electric vehicle partnership in less than a week, this time a $2 billion deal with startup Nikola.

"It will avoid having to build a new factory, instead turning to GM which will be producing the Nikola Badger pickup truck out of, probably, the Detroit Hamtramck Assembly Plant," said Paul Eisenstein, editor at TheDetroitBureau.com.

Nikola will also use a battery for its vehicle that GM is developing.

The alliances GM is forming with companies like Honda has a lot to do with dollars and cents.

"Because the industry is going to be spending perhaps a half trillion dollars on technologies like electric vehicles ... they have to find ways to cut costs," Eisenstein said. 

So partnerships with companies that typically are viewed as rivals may become more common.

"As a result you're seeing a strange bedfellow situation where companies that are traditionally rivals - Honda and GM, Ford and VW - are suddenly saying it's better to work together," Eisenstein said. 

Ultimately, that could mean good news for the consumer.

"By also combining forces, say, sharing the same battery plant and the same battery technology, they hope to improve economies of scale. That translates into lower costs."