ReutersOct 19, 2019 02:15:56 IST
By Ben Klayman and Paul Lienert
WASHINGTON/DETROIT (Reuters) - General Motors Co
The so-called BT1 electric truck/SUV program is the centerpiece of a planned $3 billion (2.3 billion pounds) investment in the Detroit-Hamtramck plant to make electric trucks and vans, and part of a broader $7.7 billion investment in GM's U.S. plants over the next four years, according to a proposed labor deal between the automaker and the United Auto Workers union.
The investments were made public by the UAW on Friday but no details were provided.
The investment would move the automaker into a part of the EV market that is largely untested and where GM has a higher likelihood of turning a profit, analysts said.
"It makes perfect sense to hit the high end of the market in order to generate some revenue that might actually turn a profit," Auto Forecast Solutions vice president of global vehicle forecasting Sam Fiorani said.
GM is mirroring the approach electric carmaker Tesla Inc
That is important for a company who previously tried to sell the plug-in electric hybrid Chevrolet Volt and all-electric Bolt cars at lower prices and higher volumes, but failed to sell enough to make those efforts profitable, Fiorani said.
The UAW's 48,000 GM hourly workers are scheduled to vote next week on the proposed contract that would end a month-long strike that analysts say has cost the No. 1 U.S. automaker about $2 billion.
GM's BT1 program includes an electric pickup for the GMC brand and an electric SUV for Cadillac, both due in 2023, the sources said.
Before then, GM plans to begin low-volume production in late 2021 of the first BT1 model, a pickup, under a different brand, the source said. A performance variant of the pickup will be added to that brand in 2022, followed by an electric SUV in 2023.
One of the sources said the Hummer name is "under consideration" but a decision has not been finalized. The pickup is codenamed "Project O."
Bringing back the Hummer name would take advantage of a still strongly recognized brand name, Fiorani said. Hummers were rugged civilian utility vehicles with low gas mileage that were inspired by military vehicles and were popular with such celebrities as actor Arnold Schwarzenegger and former basketball star Dennis Rodman.
"Putting a Hummer badge on anything is a great idea for General Motors because half the marketing is already paid for," he said. "Making it environmentally friendly is just icing on the cake."
The pickups and SUVs in the BT1 family will use a new dedicated electric vehicle architecture, including a "skateboard" chassis that bundles electric motor and batteries, the sources said. Fiorani expects the GM electric truck to sell at around $90,000 or more, while the other vehicles will easily top $100,000.
GM President Mark Reuss said in June at a UBS conference that the new EV architecture will be highly flexible, enabling the Detroit automaker to build a variety of body types in different sizes, with the capability of providing front-, rear- or all-wheel drive models.
When the plant reaches full production in 2024, it is expected to build about 80,000 electric vehicles a year, the sources said. Fiorani called that figure realistic.
As part of its plans around EVs, GM plans to open a battery plant near its closed Lordstown, Ohio, factory that sources have said would be a joint venture and is part of plans to invest another $1.3 billion in non-GM plants in the United States over the next four years.
GM Chief Executive Mary Barra said in April the automaker would make an electric full-size pickup, but provided no further details. The company has said it plans to invest $8 billion to develop electric and self-driving vehicles, launching 20 new EVs globally by 2023.
Asked about the details provided to Reuters, GM spokeswoman Jordana Strosberg said GM doesn't comment on speculation. But she added the company is committed to an electric future.
"GM believes in an all-electric future and we are making great progress in that area," she said. "We have announced that a pickup truck will be part of our future portfolio, but have no additional information to provide."
GM is aiming to be one of the first in what is soon to be a crowded market for electric trucks and SUVs.
Well-funded Michigan startup Rivian has announced plans to build an electric pickup - a premium version of which will top $90,000 - followed by an electric SUV, beginning in fall 2020. It also has a contract with investor Amazon.com Inc
GM previously held discussions about investing in Rivian and using its electric vehicle platform, but sped up its internal EV program when the startup turned to rival Ford Motor Co
Ford invested $500 million in Rivian in April and said it planned to use Rivian's skateboard to build a new Ford-branded electric vehicle.
Ford plans to unveil an electric version of its own F-series pickup in early to mid 2022, sources previously told Reuters. It also will begin selling a Mustang-inspired electric SUV next year as part of its plan to invest $11.5 billion electrifying its vehicles by 2022, including adding 16 fully electric models.
Electric pickups and SUVs - the heart of the U.S. market - could help Ford and GM generate the significant sales of EVs they will need to meet tougher emission standards and electric vehicle mandates in California and other states. The Trump administration is moving to roll back those standards – and eliminate extra credits that automakers receive from EV sales -but the electric trucks are a hedge if California prevails.
Tesla CEO Elon Musk has said the company wants to add a pickup to its growing family of premium electric vehicles, but has not provided a specific timetable. Tesla is expected to unveil a prototype this year, with analysts predicting a 2022 debut.
(The story adds dropped letter "s" in headline.)
(Additional reporting by David Shepardson in Washington; Editing by Sonya Hepinstall)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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