General Motors Racing to Make Profitable EVs by 2021

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【Summary】General Motors CEO Mary Barra recently stated that the American automaker hopes to make profitable electric vehicles by 2021 by following three crucial steps.

Original Vineeth Joel Patel    Feb 26, 2018 9:00 AM PT
General Motors Racing to Make Profitable EVs by 2021

Automakers have essentially had a knee-jerk reaction when it comes to electric vehicles. Tesla flipped the entire automotive industry on its head with the Model S and stands to do the same thing with the upcoming Model 3. As other automakers are in a rush to play catch-up, they're finding that developing electric vehicles is an expensive venture.  

General Motors CEO, Mary Barra, recently claimed that the automaker will make profitable electric vehicles, which is something no other automaker has managed to do yet, by 2021, reports Reuters

Three Items That Will Help GM Make A Profit

How does GM plan to do this? According to the report, the American automaker will follow three steps: developing proprietary battery technology, a flexible vehicle design that's affordable, and focusing on production for the Chinese market. That's an ambitious goal, as the majority of automakers have accepted the fact that EVs aren't profitable at the moment and have gone the way of entering into partnerships to help offset the costs. 

GM, though, is sticking to its guns and its three-pronged plan. But if things don't work out, the outlet claims that General Motors will have two separate businesses – one that focuses on pickup trucks, SUVs, and cars that are powered by gasoline and diesel powertrains and another global brand that predominantly focuses on China. The latter will also specialize in pay-per-use services, like robotaxis, which is something Nissan, Renault, and Mitsubishi are also looking into. 

With Tesla reportedly losing $1 billion every quarter for its EVs, GM's plan is obviously a bold one, but it is doable. As Reuters reports, GM has invested a lot of money into its electrification strategy and is constantly working on ways to reduce the costs of developing EVs. One way the automaker plans to cut costs in its electric cars is to reduce the amount of cobalt, which is the most costly component in lithium-ion batteries, in the automaker's EMC 1.0 battery system. 

In addition to making more affordable batteries, GM is also looking into making more technological and design advances, including packing more efficiently into vehicles and improving systems that manage energy flow and keep the batteries cool. 

Making Batteries Cheaper Will Make EVs Cheaper

Together, the automaker believes the changes could reduce the cost of battery cells by approximately 30 percent. That would see the price of the components go down from $145 per kilowatt-hour to roughly $100 by 2021, claims the outlet. 

The current crop of batteries in the Bolt cost roughly $10,000 to $12,000. That, as Reuters points out, is roughly one-third of the EV's total price of roughly $36,000. According to a former engineering director at GM, the price of the battery in the EV could drop to just $6,000 by 2021. The engineer, Jon Bereisa, reportedly helped develop the hybrid system in the Chevrolet Volt. And with the improvements the automaker is currently making, Bereisa believes that the next-gen Bolt "could deliver a 45-percent increase in range for about the same [battery] pack cost, or the same range at 45 percent less pack cost." 

At the moment, governments, like China's, are after EVs more than consumers are. GM, and other automakers, are attempting to cut costs of developing electric vehicles before consumer demand ramps up. Needless to say, General Motor's approach isn't exactly a secret, as other automakers are probably looking into doing similar things to bring the cost of electric-vehicle technology down. 

via: Reuters

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