General Motors pulled back the curtain on plans for a new fleet of all-electric vehicles that executives believe will push its global EV sales to 1 million annually by 2026 — and generate a profit.
They start with four new EVs by 2020, followed by a new EV platform in 2021 that will reduce costs by 30 percent or more and be used for at least 11 types of vehicles.
"We are working to provide desirable, obtainable and profitable vehicles that deliver a range of over 300 miles," GM CEO Mary Barra said last week at the Barclays 2017 Global Automotive Conference in New York. "There's a lot of really creative things we're doing to achieve that profitability point for that new platform."
The ambitious targets suggest that GM has surmounted some of the cost hurdles that make practical electric vehicles difficult to sell at prices that are affordable to consumers and profitable to the manufacturer. But other big challenges remain around battery production capacity, charging infrastructure and customer acceptance — all things that undermined GM's previous goals of selling 45,000 Volts annually and reaching cumulative sales of 500,000 electrified vehicles by 2017. (Sales were 243,133 in 2016.)
Also up in the air is the fate of the up to $7,500 U.S. federal tax credit for electric vehicles, which have helped increase EV sales. Under the House GOP tax proposal, the credit could disappear.
Barra mentioned or indirectly addressed some of the challenges but didn't provide concrete plans to solve them. She said GM will "partner, incentivize or invest" to expand DC fast-charging stations; it has "a very important strategic relationship" with battery suppliers such as LG Chem; and will offer "no compromise" EVs. Additional details could come out at the company's investor event on Nov. 30 in San Francisco.
IHS Markit forecasts that global installed capacity for lithium ion EV battery cells will need to reach 305 gigawatt-hours in 2025, eight times the capacity available today. Other forecasts run as high as 600 gigawatt-hours by 2025.
Andrew Fulbrook, executive director of light-vehicle powertrain research and analysis at IHS Markit, last month said that ramp-up will be "hard, but possible."
VW, the world's second-largest automaker, predicts battery-electric vehicles will account for 25 percent of its global sales by 2025, which IHS says would require 680 to 700 gigawatt-hours of global capacity.
"That, for us at the moment, represents a hill that is too steep to climb for the supply base, with too much risk given the still-uncertain nature of how quickly demand will increase," Fulbrook said.
Barra said GM expects its second-generation EV platform, which could underpin vehicles that exceed 300 miles in range, will drive total per-unit cost down 30 percent or more. That includes lowering the cost of battery cells to less than $100 per kilowatt-hour from $145 per kWh for the Bolt EV.
Barra said the new modular EV platform will be used across GM brands and on at least 11 kinds of vehicles, including large mainstream and luxury SUVs, "low roof" cars and a shared autonomous vehicle. To help reduce costs and increase flexibility of the platform, the company is integrating the battery cells into the architecture, she said.
However, GM is expected to use its existing EV platform for at least the first four new EVs in its previously announced plan to introduce 20 or more new all-electric and hydrogen fuel cell vehicles globally by 2023. At least two of those four are expected to be small crossovers.
GM will also expand its connected-vehicle services such as OnStar and soon launch an in-vehicle feature called "marketplace" that allows users to "do things, to order things" more simply than with a smartphone.
The service, Barra said, is just one example of GM's efforts to monetize the data from more than 13 million connected vehicles, which create 3 petabytes of data — or 3 million gigabytes — annually. Autonomous vehicles will only add to those opportunities, she said.
Michael Martinez contributed to this report.