GM & Mary Barra Place A $35 Billion Bet On EVs

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Once I noticed the latest article on the early GM electric car prototypesit jogged my memory of how the corporate over time has been method out in entrance of its friends from an engineering perspective, however failed to show that first mover benefit into success within the showroom. When the Detroit Huge Three lastly determined to handle the problem of the Japanese imports, Ford and Chrysler got here up with components bin specials just like the Falcon and Valiant that had been as thrilling as week-old Surprise bread. GM countered with the Corvair, which though saddled with a flawed rear suspension, featured numerous artistic new pondering. It was the primary mass manufacturing automotive in America to supply a turbocharged engine — a decade or extra forward of its friends.

GM subsequent launched the Chevy Vega, a tidy little hatchback with an aluminum overhead cam four-cylinder engine whereas Ford and Chrysler continued with iron block pushrod engines. Subsequent got here the Fiero, the primary mid-engine automotive from a US producer, and the Cadillac Allanté, a automotive that was so crazily over-engineered that it was a nightmare to maintain working. Quick ahead to the EV1 and the Chevy Volt, each of which had been on the cusp of the EV revolution however flamed out earlier than reaching exit velocity.

GM Is Constructing Compelling EVs

Now GM is bringing compelling electrical vehicles to market just like the Cadillac Lyriq, the Chevy Equinox EV, and the Chevy Blazer EV. The subsequent era Chevy Bolt is nearing manufacturing, whereas the electrical Hummer, Silverado, and Suburban will likely be on sale quickly. All these vehicles are going to want batteries, and for that GM has partnered with LG Power Answer to construct a brand new battery manufacturing facility close to Nashville, Tennessee. When accomplished, that manufacturing facility and one other one in Ohio will be capable to produce sufficient cells to make a brand new EV battery pack each minute. Already they’re producing extra battery cells than Tesla, in keeping with Bloomberg Hyperdrive. Josh Tavel, the pinnacle of venture engineering and manufacturing at GM, instructed Bloomberg lately, “If the market wants more EVs, we can make them.”

Mary Barra, the CEO of GM since 2014, has a aim to make the corporate a pacesetter in electrical automobiles. The previous 12 months has been troublesome for Barra and GM. First, curiosity in EVs has cooled considerably within the US. Second, the brand new administration is hellbent on smashing what it calls the “green new scam.” Whereas these components have satisfied Ford and Stellantis to pivot to constructing extra standard vehicles, Barra has largely stayed the course. She has employed Tesla veterans to make GM’s battery capabilities extra aggressive and brought steps to slash prices so as to obtain the aim of “low cost EV architecture.”

As a part of that plan, GM is constructing one other battery manufacturing facility in Indiana and has made investments in US-based mines for lithium and different minerals. Ultimately, Barra’s imaginative and prescient is to create a nationwide provide chain just like the one BYD has in China. “We’re about giving customers choice. Over the long term, we think EV demand will grow,” Barra stated.

GM is determined by a world provide chain. The absurd tariff insurance policies of the brand new administration are elevating prices for automakers throughout the board. GM executives say electrical energy merely makes for a greater automotive and represents the way forward for transportation. Batteries are key to fixing the fee equation, in keeping with Barra. “There has to be more of a charging infrastructure. There has to be more choice at the lower price points. I think it will happen over time,” she says. “Core battery technology will continue to get better.”

To Ultium And Past!

In 2018, Barra and GM president Mark Reuss got here up with a plan to push tougher into EVs by investing within the battery design that may grow to be Ultium. The concept was to make use of the identical battery cells and modules for each mannequin the corporate produces and all developed in-house. With one system for each electrical automotive, growth prices for brand new EV fashions might be dramatically lowered over time. Authorities subsidies, equivalent to those lawmakers would later bundle into Biden’s IRA, didn’t issue into the equation, Reuss says. “This whole business and strategy was planned without any IRA benefit,” he says. Nonetheless, “Kicking the can down the road and hoping for different legislative and greenhouse gas rules happening is a pretty tough way to play the business.”

Kurt Kelty used to work for Tesla. Mary Barra tried to recruit him for years however he didn’t imagine GM was severe about its EV intentions. What modified his thoughts was a tour of GM’s low value EV structure of the longer term. Kelty is now vp for battery, propulsion, and sustainability. “This is my passion in getting us off fossil fuel,” he instructed Bloomberg.

His success at GM is basically measured in value reductions. The corporate slashed the price of its battery packs by $60 per kilowatt-hour final 12 months, Kelty says. That achievement was primarily the results of elevated gross sales quantity and improved manufacturing yields on the cell vegetation. This 12 months he needs to take out one other $30 by promoting extra vehicles and enhancing yields even additional.  That will get the price of GM battery packs to about $100 per kilowatt-hour — 50% lower than in 2022. Kelty stated if that occurs, GM’s battery prices will likely be decrease than they’re for Tesla.

Kelty’s long run resolution is to take a distinct method to batteries. At present GM and LG use a mixture of lithium, nickel, manganese, and aluminum of their Ultium cells. The cells are stacked and stuffed into packing containers referred to as modules. Two dozen cells make a module, and 10 modules make up the battery pack for an entry degree Blazer or Equinox. The separate modules are needed to guard the cells, however in addition they add important weight. Kelty, who was deeply concerned within the growth of the 4680 cylindrical battery cells at Tesla, now thinks prismatic cells are the longer term.

Opposite to their title, prismatic cells aren’t formed like prisms. They’re extra like bricks that stack neatly collectively. They’re encased in arduous metallic, which offers construction with out requiring particular person modules. They’re the perfect mixture of sunshine and space-efficient, Kelty says. (BMW used to make use of prismatic cells however has now transitioned to cylindrical cells just like those Tesla makes use of for its subsequent era Neue Klasse electrical vehicles. Clearly, there isn’t a settlement but inside the auto business relating to which battery format is finest.)

GM signed a deal to buy its first batch of prismatic cells from Samsung SDI, and can develop its personal model of the know-how with LG. Over time, GM will convert extra of its batteries to prismatic, Kelty says. As a part of that transition, he plans to ditch the Ultium title. “The beauty of prismatic cells is that we can reduce the part count by about 50%,” he says. “You reduce your labor, you reduce your initial investment. Overall, you just get a massive price reduction.”

The Benefits Of LFP Know-how

Utilizing totally different battery chemistries can even decrease prices, and for that cause GM is incorporating lithium iron phosphate cells into some vehicles. Though they retailer much less power than conventional lithium-ion batteries, they’re considerably inexpensive. GM will use them within the new Chevy Bolt and a model of its Chevy Silverado pickup. As a substitute of 490 miles a cost, the truck will go 350 miles on a battery cost, Kelty says, however it would value $6,000 much less.

Kelty can be making an attempt to make GM much less reliant on international suppliers. EV batteries require graphite, 90% of which comes from China. Kelty needs to modify from graphite to siliconwhich might be sourced from suppliers within the US. GM additionally shaped a $625 million three way partnership with Lithium Americas Corp. in Nevada to mine lithium nearer to residence. These strikes require important upfront funding within the brief time period however, particularly within the age of tariffs, may carry prices down in the long run, particularly if the present tariff madness persists.

GM EV gross sales doubled in 2024 and maintained almost the identical tempo within the first quarter of 2025. Executives regard EVs as an enormous alternative to introduce GM manufacturers to drivers who by no means would’ve thought-about them earlier than. Greater than 60% of the corporate’s EV prospects have by no means owned a GM automotive earlier than, says Tavel, the venture engineering head. If GM can get the price of its EVs nearer to that of gasoline vehicles, gross sales will take off, he says. “Every customer that buys one will tell you the same thing,” he says. “To me, it’s a no-brainer.”