Detroit automaker General Motors Co outlined plans on Monday to add 20 new battery electric and fuel cell vehicles to its global lineup by 2023, financed by robust profits from sales of gasoline-fueled trucks and sport utility vehicles in the United States and China. “General Motors believes in an all-electric future,” GM global product development chief Mark Reuss said during a briefing at the company’s suburban Detroit technical center. Future generations of GM electric vehicles “will be profitable,” Reuss said, but added it was not clear when GM could make all its new vehicle offerings zero-emission electric cars. GM shares closed on Monday at $42.15, the highest level since the company’s 2010 post-bankruptcy initial public offering.
Investors pushed up GM shares ahead of the electric vehicle announcement on a Deutsche Bank comment that the automaker plans to deploy autonomous vehicles in ride services by 2020. GM indicated last month it is nearly ready to begin mass production of autonomous Chevrolet Bolt vehicles. Regulators in China and some European countries have floated proposals to ban internal combustion engines by 2030 or 2040. “We will continue to make sure our internal combustion engines will get more and more efficient,” Reuss said.
Automakers, including electric vehicle market leader Tesla Inc, lose money on electric cars because battery costs are still higher than comparable internal combustion engines. GM funds its forays into new technology using cash generated by old-technology vehicles popular with its core customer base in the U.S. heartland. In comparison, Tesla has burned through an estimated $10 billion in cash and has yet to show a full-year profit.
GM earned more than 90 percent of its $12.5 billion in pretax profits last year in North America, amid robust demand for its lineup of large sport utility vehicles and pickup trucks. The company’s profitable operations in China rely on consumer demand for an expanding lineup of gasoline-powered SUVs. GM has previously announced plans to make some of its future electric vehicles capable of driving themselves in robot taxi fleets. The company offered sneak peeks of three electric vehicle prototypes: a Buick brand sport utility vehicle, a sporty Cadillac wagon and a futuristic pod car wearing a Bolt badge.
GM collaborated with Korean battery maker LG Chem to build the Bolt battery system. Company officials did not say what companies would supply batteries for the larger fleet of vehicles promised by 2023. Fuel cell vehicles will also play a role in GM’s future, the company said. GM showed on Monday a prototype of a rolling, hydrogen-fueled platform called SURUS that could be used for multiple purposes.
The company plans to offer a fuel cell vehicle to retail customers within five years, it said. Toyota Motor Corp , Honda Motor Co and Hyundai Motor Co already are marketing fuel cell vehicles in low volume. GM Chief Executive Mary Barra said last month the company plans to introduce at least 10 new electric or hybrid vehicles to the Chinese market by 2020, and open a battery plant this year with Chinese partner SAIC Motor Corp Ltd.
China has set goals for electric and plug-in hybrid cars to make up at least a fifth of auto sales by 2025. Some of the electric vehicles GM will offer in China are among the 20 Reuss promised by 2023. GM also hinted that it may take new steps to expand the public infrastructure for rapid recharging of electric vehicles, without offering any details. The No. 1 U.S. automaker joins several rivals, including German automakers Daimler AG, Volkswagen AG and BMW AG, that have pledged to accelerate development of electric vehicles. GM’s announcement comes two days before rival Ford Motor Co is scheduled to roll out a new strategic plan, and as Tesla ramps up production of its high-volume Model 3 electric sedan.
