GM Ups Bet by $35B in Autonomous, Electric Vehicle Games

Cadillac Lyric EV is just one step in making GM a force against Global Warming and fossil fuel use.

The seemingly bottomless pit of capital being consumed in the race to survive the connected, green and autonomous vehicle wars has grown deeper with General Motors saying today it will increase its EV and AV investments from 2020 through 2025 to $35 billion. This is a – gulp – 75% increase from its initial pledge announced prior to the ongoing pandemic.

In order to appease or stimulate the capital markets, GM also noted that strong underlying business operations, including record EBIT-adjusted during the last three quarters translates to increases first-half 2021 guidance. GM now predicts its first-half EBIT-adjusted will be between $8.5 and $9.5 billion (from $5.5 B) because of continued strong demand, better-than-expected results at GM Financial, and improved near-term production from the pull forward of semiconductors from the third quarter. (AutoInformed – GM Posts Formidable First-Quarter 2021 Results; GM to Up Deliveries by Dropping Stop-Start on Pickups, SUVs)

GM aspires to become the market leader in EVs in North America; the global leader in battery and fuel cell technology through its Ultium battery platform and HYDROTEC fuel cells; and be the first to safely commercialize self-driving technology at scale through Cruise. (GM Needs Range, Battery Cost Cuts to Speed EV Plans; GM to Sell Navistar Hydrotec Fuel Cell Power Cubes for EVs; GM and LG Energy to Build Second Battery Cell Plant in US; GMC Adds Hummer SUV EV. Direct Selling Without Dealers?; Honda Joins with Cruise and General Motors to Build New Autonomous Vehicle. Honda Investment Of $750 Million Values Cruise At $14.6 Billion; Honda’s New Mobility Business – Cruise to Send First Self-Driving Vehicles to Japan for Testing; GM, Cruise, Microsoft to Commercialize Self-Driving Vehicles)

“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 GM Chair and CEO Mary Barra. “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.”

Barra observed that the changing race “include strong public reaction to the “GMC HUMMER EV and HUMMER EV SUV, the Cadillac LYRIQ and the Chevrolet Silverado electric pickup,” as well as “GM and dealer investments in the EV customer experience; public and private investment in EV charging infrastructure; and the global policy environment.”

For the record: GM’s initial commitment announced in March 2020 was to invest $20 billion from 2020 through 2025, including capital, engineering expenses and other development costs, to accelerate its transition to EVs and AVs. In November 2020, the company increased its planned investment during the same period to $27 billion. GM, however, hedged on the back end of 2021 saying it “expects the second half of 2021 will continue to be complex and fluid. The company will provide additional updates on its year-to-date financial results and outlook for the second half of 2021 during its second-quarter earnings conference call on 4August 2021.

Other GM Highlights

Accelerating Ultium battery cell production in the United States: GM is accelerating plans to build two new battery cell manufacturing plants in the United States by mid-decade to complement the Ultium Cells LLC plants under construction in Tennessee and Ohio. Further details about these new U.S. plants, including the locations, will be announced at a later date.

Commercializing U.S.-made Ultium batteries and HYDROTEC fuel cells: In addition to collaborating with Honda to build two EVs using Ultium technology – one SUV for the Honda brand and one for the Acura brand – GM announced June 15 it has signed a memorandum of understanding to supply Ultium batteries and HYDROTEC fuel cells to Wabtec Corporation, which is developing the world’s first 100 percent battery-powered locomotive.

Separately, GM will supply HYDROTEC to Navistar, which is developing hydrogen-powered heavy trucks to launch in 2024, and Liebherr-Aerospace, which is developing hydrogen-powered auxiliary power units for aircraft. Lockheed Martin and GM also are teaming up to develop the next generation of lunar vehicles to transport astronauts on the surface of the Moon, leveraging GM’s expertise in electric propulsion and autonomous technology. (AutoInformed Out of this World! Secret Lockheed Martin, GM EV Revealed)

GM is confirming plans to launch its third-generation HYDROTEC fuel cells with even greater power density and lower costs by mid-decade. GM manufactures its fuel cells in Brownstown Charter Township, Michigan, in a joint venture with Honda.

Expanding and accelerating the rollout of EVs for retail and fleet customers: In November 2020, GM announced it would deliver 30 new EVs by 2025 globally, with two-thirds available in North America. Through the additional investments announced today, GM will add to its North America plan new electric commercial trucks and other products that will take advantage of the creative design opportunities and flexibility enabled by the Ultium Platform.  In addition, GM will add additional U.S. assembly capacity for EV SUVs. Details will be announced at a later date.

Safely deploying self-driving technology at scale: Cruise, GM’s majority-owned subsidiary, recently became the first company to receive permission from regulators in California to provide a driverless AV passenger service to the public. Cruise also was recently selected as the exclusive provider of AV rideshare services to the city of Dubai and is working with Honda to begin development of an AV testing program in Japan. In addition, GM Financial will provide a multi-year, $5 billion credit facility for Cruise to scale its Cruise Origin fleet. Developed through a partnership between GM, Honda and Cruise, the Cruise Origin will be built at GM’s Factory ZERO Detroit-Hamtramck Assembly Center starting in early 2023. (AutoInformed GM’s Factory ZERO – First U.S. Plant to Install 5G)