Nikola shares recovered some of their losses on Monday after the Detroit carmaker slipped 16 percent on Friday as investors worried that General Motors would decide against taking a stake in the company.
The Phoenix-based truck start-up rose as much as 9 percent to $21.70 after the opening bell on Wall Street.
GM and Nikola have been in ongoing talks about a potential partnership in which GM would sell batteries and fuel cells to Nikola, and produce its electric pickup, dubbed the Badger, in exchange for a $2 billion stake.
On Friday, however, Nikola boss Mark Russell told the Financial Times and Bloomberg that the company is prepared to drop the idea of building the Badger if it cannot secure a deal with GM or another major car manufacturer.
While Nikola and GM have until December 3 to secure a deal, negotiations between the two companies were expected to close at the end of September.
An analyst note from J.P. Morgan's Paul Coster earlier last week said that the partnership was likely to go ahead.
"Nikola needs access to GM's supply-chain, engineering resource, the Ultium battery and Hydrotec fuel cells to de-risk the Class 8 truck initiative," Coster wrote in a note to clients.
"GM needs to realize a return on billions of dollars of investment in Hydrogen fuel cells, and Nikola might be the best available option."
It comes as GM's Cruise autonomous vehicle arm last week revealed it will run robot cars without human back up drivers in San Francisco as it looks to compete with driverless vehicles from the likes of Tesla and Google's Waymo.
The automotive company received a permit from California's Department of Motor Vehicles to allow the cars to travel on their own by the end of the year.
Ray Wert, a spokesperson for GM's Cruise said that Cruise will go neighborhood-by-neighborhood in San Francisco and launch the driverless vehicles slowly before spreading to the entire city.
"We understand that this is a trust race as much as it is a technology race," Wert told AP. "This is absolutely about making sure that we're doing this with San Francisco."
The move follows Waymo's announcement that it would open its autonomous ride-hailing service to the public in the Phoenix area in vehicles without human drivers.
The service was only made available in a limited area due to regulations in Arizona being relatively permissive, and due to the vehicles needing a detailed three-dimensional map to tell them about the road environment.
Arizona officials, which have taken a lenient approach to regulation, have attempted to lure companies working on self-driving technology out of neighboring California, where regulators are less receptive.
Waymo, which is a division of Google parent Alphabet, is also aiming to expand the service into California.
FCA was our first OEM partner, and together we’ve brought the world's first & only on-road autonomous driver+vehicle to the world - no licensed human driver required. Now we're expanding our partnership and the scope of the Waymo Driver in major ways. https://t.co/F3RfTVvLac pic.twitter.com/4iqFuRKjqv
— John Krafcik (@johnkrafcik) July 22, 2020
Unlike GM, and manufacturers such as Volvo and Tesla, Waymo has said its focus is on offering an autonomous taxi service as opposed to autonomous vehicles. It is working with Avis Budget Group who is managing the physical fleet of vehicles.
The race to autonomous vehicles slowed somewhat in the last few years after an Uber autonomous test SUV ran down a pedestrian in Tempe, Arizona in 2018. It was believed to be the first pedestrian death associated with self-driving technology.
Uber suspended testing in Tempe as well as in Pittsburgh, San Francisco, and Toronto on the back of the accident.
Waymo claims trials in excess of 20 million miles of autonomous driving as of January 2020.
Uncommon Knowledge
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
