Detroit automotive giant General Motors (GM) says it will increase spending on electric vehicles (EVs) and autonomous vehicles by 75% through 2025, to a total of $US35 billion.
Backed by record earnings over the last three quarters, GM says the spending is focused on its strategy to overtake Tesla and become the North American EV market leader, and a global leader in battery and fuel cell technology through its Ultium battery platform and Hydrotec fuel cells.
GM will also prioritise its Cruise technology, hoping to become the first to safely commercialise self-driving technology at scale.
“We are investing aggressively in a comprehensive and highly-integrated plan to make sure that GM leads in all aspects of the transformation to a more sustainable future,” said Mary Barra, GM’s chair and CEO.
“GM is targeting annual global EV sales of more than 1 million by 2025, and we are increasing our investment to scale faster because we see momentum building in the United States for electrification, along with customer demand for our product portfolio.”
GM originally announced in March 2020 that it would invest $US20 billion between 2020 and 2025 into EV and autonomous vehicle technology. Eight months later the company ramped that investment commitment up to $US27 billion.
Now, with continued strong financial performance behind them, GM will invest between 2020 and 2025 a total of $US35 billion – which converts to around $AU45 billion, at current rates.
Still, some analysts think that the recent strong performance of GM and other major car makers is potentially a mirage, and suggest that the real value of their petrol and diesel car business is zero, or worse. It may be that GM understands this too.
“There is a strong and growing conviction among our employees, customers, dealers, suppliers, unions and investors, as well as policymakers, that electric vehicles and self-driving technology are the keys to a cleaner, safer world for all,” Barra said.
One of the first things GM will do with its increased financial focus on EVs and autonomous driving is bring forward the construction of two planned Ultium battery cell manufacturing plants in the United States.
In addition to the two Ultium Cells plants already under construction in Tennessee and Ohio, the construction of two as-yet unnamed plants will be brought forward to be completed by mid-decade – though exactly how big and where will be announced at a later date.
GM and South Korean battery maker LG Chem announced their Ultium joint venture back at the end of 2019.
The two companies promised to invest $US2.3 billion to build a factory in Lordstown, Ohio, which will produce their proprietary Ultium batteries – which will offer energy options ranging from 50kWh to 200kWh and which, thanks to their large-format pouch-style, can be stacked vertically or horizontally inside the battery pack, allowing engineers to optimise battery energy storage and layout for each vehicle design.
According to GM, Ultium batteries will enable a range of up to 640 kilometres (400 miles), and acceleration of 0-100 in as little as 3 seconds.
Construction began on the Ohio battery plant last year, with ground preparation beginning in May and steel construction beginning in July. With an expected annual production capacity of more than 30GWh and the flexibility for possible expansion, the Lordstown Ultium factory will create over 1,100 new jobs.
Ultium batteries will also be at the heart of two jointly-developed next-generation EVs announced by GM and Japanese carmaker Honda last year. The two new vehicles – an SUV for the Honda brand and an SUV for the Honda-subsidiary Acura brand – will unlock the strengths of both companies to kick-start Honda’s transition to electric mobility.
GM’s Ultium batteries and its Hydrotec fuel cells will also be supplied to Wabtec, a US-based rail and transportation company, which is developing the world’s first battery-powered locomotive.
The partnership, announced on Tuesday, will see the two companies work together to develop a solution for heavy haul locomotives that takes full advantage of GM’s Ultium and Hydrotec technologies.
On top of its commitment to its Ultium and Hydrotec technologies, GM will utilise its increased investment in EVs and autonomous vehicles to accelerate the rollout of EVs for retail and fleet customers.
GM will add new electric commercial trucks to its North American fleet offerings, as well as additional US assembly capacity for EV SUVs.
Finally, Cruise, GM’s majority-owned autonomous driving subsidiary, will also benefit from its parent company’s renewed financial commitment to self-driving vehicles, and will receive a $US5 billion credit facility from GM Financial to help scale its Cruise Origin fleet – the company’s first self-driving car.
Cruise has already signed partnerships with potential big name customers including Walmart, as well as a significant strategic partnership with American technology giant Microsoft.