General Motors’ aspiration to stop selling fuel-burning cars by 2035 could put a big dent in its overall market share if it doesn’t considerably boost sales, some auto industry analysts think.
While electric cars are in vogue, and companies like Tesla command share prices that could make a legacy automaker envious, automotive insiders continue to voice concerns over how ready the world is to fully shift to electric vehicles. Firms that survey car buyers frequently say many still worry about vehicle range and charging times, for example.
GM, the largest U.S. automaker, said its plan to eliminate tailpipe emissions by 2035 is a goal and not a guarantee. Nevertheless, it is making a big push into pure electric vehicles, as more than 30 new models are expected by 2025.
GM’s plan does not include hybrids, which blend internal combustion engines with electric power, and which many see as a crucial bridge between traditional fuel burning cars and electrics.
“They have committed to going all electric, not doing hybrids, not doing plug in hybrids, and jumping right to electric vehicles,” Cox Automotive analyst Michelle Krebs said. “So it’s a huge risk. It’s bold, it’s very ambitious. And the risk is, well, you know, can they do it when they do it, especially in light of range costs and infrastructure issues?”
The automotive industry seems to be dividing itself between companies that are spreading their investments across different powertrains — such as internal combustion engines, electric motors and hybrids. Some automakers, such as Toyota, are investing in other alternative powertrain technologies, such as hydrogen fuel cells.
To be sure, GM has some factors in its favor.
Its Ultium battery technology, which was built in collaboration with LG Chem, has impressed many in the industry. GM says the batteries use far less cobalt and other materials than competing batteries, which dramatically lowers costs to levels that can make electric cars competitive and profitable. The box-like “pouch-style” cells can be stacked in various ways to suit an array of vehicle designs.
GM is also releasing electric vehicles in categories that have been successful for the company — such as full-size trucks and sport utility vehicles.
Finally, GM has a long record of embracing technologies such as pollution-filtering catalytic converters to engines that can shut off cylinders to improve fuel mileage.
However, some of those technologies did not resonate with customers, and that could happen again. So GM is trying to create products drivers will actually want.
“I think that’s one of the keys,” Guidehouse Insights principal analyst Sam Abuelsamid said. “The products that are coming that haven’t been publicly announced yet, those are the ones that I think are going to be much more appealing to the the market; the kind of vehicles that consumers today actually want to buy.”
Source: Business - cnbc.com
