General Motors on Wednesday secured its path into a high-tech future by announcing plans to convert more assembly plants in North America to manufacturing electric vehicles by the end of the decade and to double company sales by then as more software and new electric vehicles to be introduced.
GM executives are expected to attend their annual Investor Day presentation starting Jan. new technologies will also be revealed, such as z o’clock ET.
“Our early investments in these growth trends moved GM from automaker to customer-centric platform innovator,” said CEO Mary Barra. “GM will leverage its hardware and software platforms to innovate and enhance their daily experience, leading everyone on the journey to an all-electric future.”
Barra stressed that hourly workers will not lose their jobs switching to electrical, and GM continues to hire employees with a background in technology and digital software.
“We hired 3,000 people late last year and this year alone we’ve hired 8,000 people, particularly in technology, digital and software,” said Barra. “When we talked about going carbon neutral by 2040, people said, ‘I want to be a part of it’ and we saw that the number of applications increased.”
About 100 investors are expected at GM’s Investor Day at the GM Global Technical Center in Warren. On Thursday, investors will be at GM’s Milford Proving Grounds to see new products and technology, including a spin in the 2022 GMC Hummer EV pickup and a tour of the new BrightDrop fully electric delivery vans.
GM is expected to present investors with detailed plans to double its annual revenue by 2030 and increase adjusted profit margins before interest and taxes (EBIT) as it moves towards an all-electric future.
Barra said much of the revenue growth will come from GM’s new businesses like upcoming electric vehicles, start-up BrightDrop electric delivery van and OnStar insurance, as well as future software that would tap revenue streams through subscriptions.
To get a feel for how much sales GM is aiming to make, the company reported sales of $ 122.5 billion for 2020. That was 10.8% less than in 2019, after GM closed all of its factories in North America last year The COVID-19 pandemic had closed for eight weeks at the peak. Still, GM reported net income of $ 6.4 billion for 2020, while adjusted operating profit was $ 9.7 billion.
GM is in the process of becoming a technology innovator and promises to invest $ 35 billion in electric and autonomous vehicles by the middle of the decade. GM will also bring 30 new EVs to market by then.
But it has ingestion from many other tentacles. For example, the majority company Cruise is working on a robot taxi service with self-driving cars. Cruise CEO Dan Ammann is expected to outline the plan for its ride-hailing business, which should reach $ 50 billion in revenue when operations ramp up. There’s no timeline yet to achieve this goal, but Cruise is expected to charge travel fees for the next year if it receives approval from California regulators.
In an investor note on Monday, Morgan Stanley analyst Adam Jonas wrote of Cruise: “In our model, we do not forecast such sales growth until 2038 and $ 1.50 sales per mile.”
GM President Mark Reuss also pointed out that GM’s subsidiary GM Defense, founded by GM in 2017, is a strong source of income. Last year, the US Army awarded GM Defense its first major contract worth $ 214.3 million to build the Infantry Squad Vehicle (ISV). Last month, GM Defense won $ 36.4 million Contract of the US State Department develops next-generation large commercial vehicles for diplomatic security.
A completely different, cool pickup
GM’s Ultium platform, which will underpin its new electric vehicles and flexibility, will allow GM to offer high-volume entries like a Chevrolet SUV at a cost of around $ 30,000. GM said it will also bring all-electric Buick SUVs, pickups from Chevrolet, GMC and Hummer, and Cadillac vehicles.
On Wednesday, GM showed a glimpse of the Chevrolet Silverado E, the all-electric pickup set to be unveiled at the Consumer Electronics Show in Las Vegas in 2022. GM showed a picture of its all-glass roof.
The Silverado E is built together with the GMC Hummer EV pickup and the Hummer SUV at Factory ZERO in Detroit and Hamtramck. GM does not announce exact launch dates for the Silverado E, but Reuss said production will begin in the first quarter of 2023 after Hummer SUV production begins.
Silverado E will be positioned and marketed differently than its internal combustion engine Silverado, said Reuss. He said it will still target pickup customers, but they will be a different demographic.
“The evidence of who we are going to target is very clear when you see the truck,” Reuss told reporters. “This is a very innovative (approach) and will spark people’s interest in a base for growth. The design and the proportions will be completely different and very cool. “
Other EV assembly plants
To bring its 30 new EVs to market, Barra said more than half of GM’s North American and Chinese assembly plants will be able to convert to EVs by 2030.
GM has already marked the following plants for EV production:
- Orion Assembly in Orion Township currently building the Chevrolet Bolt EV and Bolt EUV.
- Factory ZERO in Detroit and Hamtramck to build the GMC Hummer EV pickup and SUV and Silverado E.
- Spring Hill Assembly in Spring Hill, Tennessee to build the Cadillac Lyriq SUV
- CAMI in Ontario builds BrightDrop EV delivery trucks.
- Ramos Arzipe Congregation in Mexico build batteries and electrical components this year.
“We will be able to expand and remodel other facilities,” said Barra. “We have a plan to bring ourselves to the US by 2035 in terms of light commercial vehicles.”
GM has no immediate plans to build new assembly plants, Barra said, noting that it is currently building two Ultium LLC battery plants as part of its LG Energy Solutions joint venture. One will be in Lordstown, Ohio and the other in Spring Hill, Tennessee.
Barra said GM’s existing manufacturing presence will allow us “to work fast, but if we need a new plant, we can do that too. But we have trained employees who know how to build our vehicles and build high quality products. We also want to take our entire workforce with us. “
The gradual transition from GM
This year, Barra and other executives gradually laid the foundation for GM’s expansion beyond just producing and selling vehicles. In fact, the Free Press reported two weeks ago that Alan Wexler, GM’s senior vice president of innovation and growth, said: GM becomes a software company that’s what makes hardware simple: cars.
Wexler said GM’s new business model will use vehicles as a platform to deliver software developed by GM that provides services that can be used outside of the car. He called it “a potential game changer for providing subscription services that generate recurring revenue”.
Last week, GM launched a new software platform, it created called UltifiGM’s Scott Miller, vice president of software-defined vehicles, said is a “big, big step in our software strategy.”
Much like software on a smartphone, Ultifi will be able to provide regular updates and let customers choose from a variety of over-the-air upgrades, personalization options, and apps.
On Tuesday, GM announced that 55-year-old software innovator Aneel Bhusri would be appointed to its board of directors. Bhusri is the co-founder, co-CEO, and chairman of Workday, Inc. Workday specializes in software that helps managers work better with employees. GM now has 13 directors with Bhusri.
Also on Tuesday, GM announced a new digital business team that will be led by newly appointed Chief Digital Officer Edward Kummer, 58, starting October 16. Sorrow will build a digital business and accelerate software investments to bring more software to consumers. Kummer, who was president of Nordstrom Rack’s online business and Nordstrom’s HauteLook brand, will report to Reuss.