CEO Mary Barra has set out a tall order for General Motors – and the industry – to increase production of its Chevrolet Bolt, protect tax credits, and develop infrastructure. But is everything as it seems or do profits prevail?
Speaking at the CERAWeek energy conference in Houston, Ms. Barra told energy scholar Daniel Yergin of the automaker’s plans for its electric future in the US. Primarily, General Motors (GM) intends to increase production of its popular Chevrolet Bolt in the upcoming months. Barra refused to discuss the level of output increase at GM’s Detroit-based plant but it is likely that the company is looking to support – and improve on – its sales figures.
The company is also looking towards the US Government for help. Currently eligibility for the US$7,500 consumer tax credit phases out over 12 months after the automaker hits 200,000 EV sales. The scheme was initially threatened with scrappage but was saved after a vote in Congress last December. GM is expected to hit the 200,000-mark later this year – perhaps sooner, once it ramps up production.
Barra stated: “We feel tax credits should be expanded so our customers continue to receive the benefit going forward… we believe in an all-electric future.” Evidently, General Motors has decided to pursue a larger number of sales, and keep the customer incentive, despite purportedly making a loss of approximately US$7,400 from every Bolt sold.
Looking to recoup losses elsewhere, the CEO also demanded that the current administration take changes in driving into account. “We also feel the regulations need to comprehend new developments in the industry – like the move away from one owner, one vehicle – that have taken place since the rule was finalised in 2012. Current standards did not comprehend increased shared and autonomous electric vehicles.”
Barra was also keen to highlight that certain states have different fuel economy regulations – such as California, well-known for its tough stance – and argued that everyone should be brought to the same measure. She called this an opportunity “to advance innovation for our customers today and tomorrow.” The CEO, however, did not mention if she believed that regulations should become tougher – or easier. She, instead, asked for a ‘modernisation’ to reduce the burden on administrators. It is expected that government officials will allow a significant reduction in requirements when the standards are reviewed in April.
While GM has promised 20 new electric vehicles by 2023, that “electric future” is still a long way from its current position. At present EVs make up a tiny percentage of the company’s overall sales, and it still seems to prioritise many of its ICE products. Additionally, GM instructed its European dealers to stop taking orders for the Chevrolet Bolt (sold as the Opel Ampera-e) in late 2017, because of low production output. The move, compounded by the decision to increase production in the U.S., is odd and could hinder the company in the future.
Similarly, the company has not had a stress-free quarter; GM’s stock price has fallen by around 20% in recent months, as of March 2018.
Mary Barra’s interview with CNBC.
However, on a positive note, Barra also announced that GM intends to develop charging infrastructure in order to support the greater number of Bolts manufactured – something of a U-turn since 2016. The CEO also encouraged other automakers to join in. She identified the need for greater driver support in order to increase uptake, adding that “as more and more people recognise that we have the right range, understand that we have a charging infrastructure so they don’t think you’re going to be stranded, I think you’re going to see EV adoption continue.”