General Motors and its race to become “No. 1" in the EV space

Speaking with TMS, Matt Pressman, the president EV Annex, an aftermarket accessories company for Teslas, noted that the biggest difference between GM and Tesla Inc. is just the technological advancements that Tesla has made in the EV landscape over the past few years.

Who is General Motors?

• General Motors Co., or GM, is the largest American automaker and also one of the oldest carmakers in the world. Just to provide a bit of context as to how large the company was, during its peak, it had a 50% market share in the United States and was the world’s largest automaker from 1931 through 2007.

• While the company’s market share has dropped substantially since, in 2020, GM still held around 17.3%, with Toyota Motor Corp. following in second place at 14.4% and Ford Motor Co. 13.9%.

• But it’s not just the US where the company has a large presence, but also abroad in countries like mainland China, where GM has 10 joint ventures, two wholly-owned foreign enterprises, and nearly 60,000 employees. It’s also in part responsible for the production of Baojun, Jiefang and Wuling.

• Although GM isn’t the first carmaker to come to mind when it comes to electric vehicles (EVs), according to the company, it “believes in an all-electric future," and has actually been trying to move into this space for some time now.

• In fact, the company created the EV1 back in 1996, the first mass-produced, purpose-built modern electric car in response to the zero-emission vehicle mandate by California’s Air Resources Board.

• But EV1s were discontinued in 2003 because the company said it was too expensive to make and maintain these vehicles. GM and other carmakers during this period also got the Californian state to ease the mandate in 2002.

What’s GM’s history with electric vehicles?

• After the EV1, it took 15 years for GM to make another full attempt at an EV when they started planning the Chevrolet Spark in 2011.

• This attempt was also a bit bumpy, though. Some of the company’s EVs were found to have technical issues, such as Chevrolet Bolt batteries in 2017-2019 models catching on fire.

• It actually got to the point where the National Highway Traffic Safety Administration had to put out a statement that basically told owners of these modeled vehicles to park away from homes in case their car caught fire.

• But, even though GM had a bit of trouble transitioning, throughout the years, the company has also continued to invest behind the scene in EV makers, including Nikola Corporation, an EV maker whose reputation has been plagued with fraud and scrutiny.

• But, the company promised earlier this year that they would be attempting to end the production of all fossil-fuel vehicles by 2035 following President Joe Biden’s climate initiatives.

What is GM’s relationship with the US government?

• Thanks to the recently passed infrastructure bill, massive funding will be going into EV charging stations across the US, and President Joe Biden is planning to take a visit to GM’s new “Factory Zero” in Detroit, Michigan this week.

• The factory isn’t new itself, but it has a grand reopening next week as it becomes a fully-dedicated EV factory.

• Not only is GM seeing more government attention in the form of presidential visits, but the company is also working on a prototype for an electric military vehicle.

• GM has been primarily responsible for producing the Hummers that the military currently uses, but the company is also wanting to make these notorious gas guzzlers into a full EV.

What do critics have to say about GM’s history with EVs?

• Speaking with TMS, Matt Pressman, the president EV Annex, an aftermarket accessories company for Teslas, noted that the biggest difference between GM and Tesla Inc. is just the technological advancements that Tesla has made in the EV landscape over the past few years.

• “Many industry observers have noted Tesla’s lead, in the EV space, could be between 5 and 10 years,” says Pressman. “In addition, if GM goes ‘all in’ on EVs they’ll have stranded assets at their factories which are set up for production of internal combustion engine powered vehicles. That’s also where their expertise, supply chain, and experience lies. This is a tough transition that favors Tesla over GM.”

• But it’s important to note that GM is receiving a lot of support from the government with this transition into EVs, especially when it comes to building out the network of charging stations needed.

• “The infrastructure bill will help to expand charging stations all over the US and this will help companies like GM who don’t have their own proprietary charging network (like Tesla),” says Pressman. “Any efforts by the government to support the EV transition will certainly help legacy automakers like GM.”

• And with that, the company announced in late October that it would install 40,000 charging stations across North America, in line with its US$750 million commitment to increase its mark in this sector.

What’s next?

• In early October, during an investor presentation, GM’s Chief Executive Officer, Mary Barra said that the carmaker was in a “good position" to compete with rival players.

• “When you look at all the investments we have been making for five years plus, that’s what positions us to really be in execution mode.”

• Not only does GM have ambitions in electric vehicle production, but the company also wants to develop ride-hailing services with autonomous cars, move into insurance products and expand its defense contracts with the government.

• In the past, GM has been bailed out of bankruptcy by the US government, and it currently holds several of these government contracts that will lead to the production of military vehicles.

• While Barra didn’t mention Tesla when speaking to reporters that day, she did say that GM wants “to be No. 1 in EV market share in the United States.”

• With Biden going to visit the automaker in the next few days, it’ll be interesting to see what the president says about the company’s prospects and future.

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