However, a subsequent high-profile report – from short-selling firm Hindenburg Research – alleged the start-up was an “intricate fraud" built on a "platform of lies."
GM moved to distance itself from the company following the fallout, and officially terminated its relationship despite Nikola CEO Trevor Milton standing down.
Last week the two companies signed a non-binding “memorandum of understanding," which lays out the framework for a watered-down relationship.
The new agreement does not include any mention of Badger production, and instead largely focuses on the supply of Hydrotec fuel cell systems for Nikola's Class 7/8 commercial semi-trailer trucks.
In an official statement following the announcement, Nikola conceded this was effectively the end of the line for its pick-up project.
“The MOU does not include the previously contemplated GM equity stake in Nikola or development of the Nikola Badger,” the statement said.
“As previously announced, the Nikola Badger program was dependent on an OEM partnership,” it continued.
“Nikola will refund all previously submitted order deposits for the Nikola Badger.”
Share prices for the start-up have fallen through the floor following the revelation, sinking from $34.50 (AU$46.81) to $20.40 (AU$27.68) since November 25.
This represents a decrease of 42.5 per cent in just five days.
Market capitalisation now sits at $7.84 billion (AU$10.64 billion).