DETROIT — General Motors is using two of its longest-running nameplates, the Chevrolet Suburban and Tahoe, to help lay the foundation for its electric future.
That doesn't mean it's making the big SUVs electric — yet. For the latest redesign of the Suburban and Tahoe, GM stuck with a tried-and-true formula, packing the vehicles with more technology and carving out significantly more interior space in the hopes of protecting its market share in the one major segment that the automaker still dominates.
GM's ability to maintain its 54 percent share of the full-size, nonluxury SUV category is critical to generating the profits needed to fulfill the big promises it's making.
"Over the next number of years ... we will eventually electrify the entire portfolio," Barry Engle, president of GM North America, said in an interview last week. "Each of the segments ultimately will be electrified."
As of today, consumers haven't bought into GM's confidence in an EV future. Battery-electric vehicle sales by all manufacturers make up only 1.7 percent of the U.S. market this year, according to J.D. Power sales data, vs. 1.6 percent for the full-size SUVs sold by GM's Chevy, GMC and Cadillac brands alone.
The revenue those SUVs generate for GM is significant, while its electric vehicle investments are still years away from contributing much to the bottom line. As automakers make such investments, "every bit of revenue becomes even more important," said Stephanie Brinley, principal automotive analyst at IHS Markit.
Most automakers have developed two product streams: "One that's going to expect to pay off in five, 10, 15, 20 years and one that needs to pay off now," Brinley said. "The full-size SUVs definitely need to bring in revenue and profitability in that near term."
The 2021 Tahoe and Suburban are slated to go on sale in mid-2020. Redesigns of the GMC Yukon and Yukon XL and the Cadillac Escalade and Escalade ESV also are due next year.
Meanwhile, in just the past two months, GM has announced investments of more than $4 billion toward EV manufacturing, including a joint venture with South Korean battery-maker LG Chem in Ohio. Last week, Cadillac President Steve Carlisle said that by 2030, the majority of the luxury brand's lineup will be BEVs.