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Comment by yangchi | Hacker News Reader

I think you read the $2B upside down. Nikola paid GM $2B worth of stocks (11% of the company) to have GM manufacture its vehicles, not the other way around

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You're right I misread it - Nikola is paying GM. Sounds like a no-brainer for GM to accept.

Worst case, and let's be honest, modal case, Nikola goes under and GM has tech and parts that they can just use on their own anyway in their electric vehicles.

Even better for GM, they just acquire the whole thing and now they have a new brand to make their EV's under. GM could make a Chevy Volt 2x better than any Tesla, but Tesla will still sell better because of the brand identity. If you look at it like a branding/marketing deal then it makes a lot more sense from GM's perspective.

...right up until Nikola becomes a synonym for Theranos or Enron. The company is public, when it implodes there will be lawsuits and not just from a few private investors.

>GM could make a Chevy Volt 2x better than any Tesla

As someone who worked in automotive tech in Detroit. This isn't even close to true.

Sorry for the vague wording. I meant "could" not as a statement of their actual ability, but as a hypothetical. If they did make such a car, Tesla would still sell better because of the brand. The current public narrative says that Tesla is cutting edge and futuristic, and Chevy is old school. Tesla's brand evokes images of cars as smart as their drivers, and Chevy evokes muscle cars and old pickup trucks. EV sales will reflect that regardless of how their cars actually compare to one another.

> If they did make such a car, Tesla would still sell better because of the brand.

That is highly questionable to me.

> The current public narrative says that Tesla is cutting edge and futuristic, and Chevy is old school.

That the current 'narrative' because its currently true.

If Chevy made something better than a Tesla for a similar price or cheaper then people would buy it. But they can't.

and unfortunately they don't really want to.

In addition to $700M from Nikola to cover the expenses of the work that GM is supposed/going to do for them.

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