March 4, 2020
WARREN, Mich. — General Motors on Wednesday unveiled a new type of battery and an adaptable vehicle platform that it says will drive the company's $20 billion investment in electric vehicles.
The company aims to sell more than 1 million electric vehicles in North America and China by 2025. The new technology will allow many of those vehicles — including 10 new EVs unveiled to reporters and investors, among them the Hummer EV and new "flagship" Cadillac offerings — to achieve 400 miles in range.
The so-called Ultium battery and the company's modular vehicle platform form the backbone of a range of new EV offerings from GM brands, from the diminutive Chevrolet Bolt hatchback to the Cadillac Lyriq luxury SUV set to debut in April, to the gargantuan-seeming GMC Hummer, which is rising from the dead as an EV in May.
The battery, the product of GM's joint venture with the South Korean battery maker LG Chem to build a $2.3 billion factory in Ohio, will allow certain vehicles to boast ranges of up to 400 miles, rivaling similar offerings from established automakers like Tesla and Ford and all-electric startups like Lucid Motors.
GM said that the more powerful battery will also allow it to expand its offerings of the hands-free, highway-driving Super Cruise, once available only on Cadillac cars and SUVs, to 22 vehicles by 2023. The rival to Tesla's Autopilot will arrive on 10 vehicles by next year, including a slightly longer version of the Chevy Bolt, branded as an "EUV," that will be the first GM production vehicle equipped with an Ultium battery and the first non-Cadillac vehicle to have Super Cruise.
The effort will form the heart of the company's self-proclaimed "Drive to Zero," where GM is aiming to combine EVs and self-driving technology — including the battery-driven Cruise Origin autonomous vehicle — to achieve zero crashes, zero emissions, and zero congestion.
"Our team accepted the challenge to transform product development at GM and position our company for an all-electric future," GM chairwoman and CEO Mary Barra said. "What we have done is build a multi-brand, multi-segment EV strategy with economies of scale that rival our full-size truck business with much less complexity and even more flexibility."
The modular platform follows the playbook being run by most automakers making major investments in EVs, including the U.S. startup Rivian, which is building battery-powered pickups, and the UK's Arrival, which boasts investments from UPS, Hyundai, and Kia to build all-electric delivery vans.
The announcement by GM, though, marked a new effort by the company to distinguish itself from what's becoming an increasingly crowded EV field. During media tours this week and in press statements, the company repeatedly highlighted its deep resources as an established, enormous global automaker, implicitly drawing a contrast with startups like Rivian, Lucid, Fisker Inc,. and Faraday Future that periodically found themselves on the brink of going bust — or, in the cases of Fisker and Faraday, actually saw the previous versions of their respective companies go bankrupt.
"Thousands of GM scientists, engineers, and designers are working to execute an historic reinvention of the company," GM President Mark Reuss said in a statement. "They are on the cusp of delivering a profitable EV business that can satisfy millions of customers."
Although dozens of reporters were present at the event, it was as much a pitch to financial analysts and investors as it was a press announcement to the public. As Tesla's stock has soared, legacy carmakers have struggled to convince investors of the EV business case. In the past six months in particular, as automakers made major announcements with their EVs having yet to debut, stock prices have struggled.
GM shares on Wednesday before the announcement, for example, were hovering around $30, far below its five-year peak of $45.88 in October 2017 (even before the abrupt drop caused by the coronavirus, they were fetching about $34.) Similarly, Ford, worth about $16 a share in March 2015, had fallen below $7 as of Wednesday morning.
"The first generation of GM's future EV program will be profitable," GM said in its statement. "The initial programs will pave the way for further accretive growth. GM's technology can be scaled to meet customer demand much higher than the more than 1 million global sales the company expects mid-decade."
The company also sought to address the supply chain bottlenecks that have continued to bedevil EV automakers, most recently for Audi, which was forced to stop production of its E-Tron SUV due to battery supply shortages. GM's partnership with LG Chem is widely seen as a hedge against such shortages, and the automaker also plans to reduce its reliance on expensive and rare materials such as cobalt, chiefly by replacing much of it with greater amounts of nickel and by adding aluminum.
"GM is all-in on batteries, that we're going to be making our own cells," lead engineer Andy Oury said.
The LG Chem partnership and the heavy investments in battery tech are part of GM's effort to bring the costs of cells down from about $145 per kilowatt-hour currently to less than $100 per kilowatt-hour, generally seen as the crossover point for when battery-powered vehicles become cheaper than their internal-combustion counterparts.
"We are aggressively going after every aspect of the EV ecosystem," Barra said.