What happened

Shares of embattled electric-truck start-up Nikola (NASDAQ:NKLA) were trading lower on Friday after its CEO downplayed the need to build an electric-pickup truck as negotiations with General Motors (NYSE:GM) remain unresolved.

As of 2 p.m. EDT, Nikola's shares were down about 14.2% from Thursday's closing price.

So what

In interviews with Financial Times and Bloomberg, CEO Mark Russell said that the company is prepared to drop the idea of building the Badger if it can't secure an agreement with GM or another major automaker. 

GM and Nikola have been in discussions about a potential partnership in which GM would sell batteries and fuel cells to Nikola, and engineer and build Nikola's electric Badger pickup, in exchange for a $2 billion stake in the start-up. 

A silver Nikola Badger prototype, an electric pickup truck.

What is Nikola worth if the GM deal, and the Badger pickup, don't happen? That's the question that Nikola's investors were confronting on Friday. Image source: Nikola Corporation.

GM's willingness to complete the deal appears to have diminished after a noted short-seller accused Nikola and its founder Trevor Milton of deception. Both Nikola and Milton have denied the claims, but the accusations led to a sell-off of Nikola's high-flying shares and Milton's departure from the company. 

Automotive sector investors have seen the pending deal with GM as a viable path forward for the company in the wake of Milton's departure. Fears that the deal may not happen, amplified by Russell's remarks, put pressure on Nikola's stock on Friday.

Now what

GM and Nikola announced their partnership just a few days before the short-seller's report was published. The original deal would have given GM $2 billion worth of newly issued Nikola shares at a price of $41.93 per share. With Nikola now trading around $20, it's believed that GM is seeking a larger stake, or additional compensation, before moving forward.  

The original deadline to finalize the agreement has passed; the parties are now working to close the deal -- or abandon their partnership -- by Dec. 3. Stay tuned.