Technology stocks and the Nasdaq Composite index may be moving down more than 2.5% today, but one name in the electric vehicle (EV) sector is bucking the trend. The stock of vehicle electrification company Lightning eMotors (ZEV) soared as much as 27.4% early Thursday after it announced an agreement with General Motors. While it pared down some of those gains, Lightning eMotors shares remained up 11% as of 2:05 p.m. ET.
The companies agreed to collaborate to provide fully electric Class 3 through Class 6 commercial fleet vehicles for GM customers. General Motors will provide the truck platforms, and Lightning eMotors will electrify medium-duty vehicles to create zero-emission solutions for fleet vehicles "which can be used for several vehicle applications like school buses, shuttle buses, delivery trucks, work trucks and more," according to a company statement.
While the companies didn't reveal any quantitative value for the agreement, it clearly is a boon for a company like Lightning eMotors with a market cap of only $338 million. The company says the deal makes it the first designated GM Specialty Vehicle Manufacturer (SVM) to provide fully electric, medium-duty commercial vehicles.
Lightning eMotors' CEO and Co-Founder Tim Reeser said in a statement, "GM's inclusive approach to electrification is a great match for Lightning's position and role as a leading powertrain supplier in the commercial vehicle space."
The agreement also provides GM another avenue as it invests $35 billion through 2025 in its transition to manufacture electric and autonomous vehicles, and its goal to be all-electric by 2035. Investors in Lightning eMotors are happy to play a role in helping the automotive giant reach that goal.