General Motors plans to double revenues to $ 280 billion by 2030 while increasing profit margins as the company moves away from manufacturing gasoline cars to electric vehicles.
America’s largest automaker said it would achieve sales growth by building electric vehicles using common parts and its Ultium battery to produce a broad portfolio of vehicles, including high-volume models such as a Chevrolet Equinox. electrified, a crossover that will be priced at $ 30,000.
GM predicts that electric vehicle revenues will grow from $ 10 billion in 2023 to $ 90 billion in 2023, said Paul Jacobson, chief financial officer. The company expects profit margins by the end of the decade to be between 12 and 14 percent.
The company said it would add $ 80 billion in additional revenue to new businesses, such as its autonomous driving subsidiary Cruise, and subscriptions to services such as auto insurance or roadside assistance.
“We see moderate growth with the current portfolio when you look at our [internal combustion engine] vehicles, then our auto financing, ”said Mary Barra, Managing Director on Wednesday. “Initially, we see that the volume of EVs is lower, so we see a tremendous opportunity for growth from an EV perspective, then subscriptions and services. “
GM has averaged $ 140 billion in revenue over the past five years, Jacobson said. In the second quarter of this year, GM reported an operating profit margin of 12 percent.
The auto industry is struggling to turn to manufacturing electric vehicles after decades of focusing on vehicles with combustion engines. GM has already pledged to spend $ 35 billion on electric vehicles by 2025, with plans to stop making petroleum-powered cars, trucks and vans after 2035.
The company has announced plans to launch 30 models of electric vehicles globally, with the goal of selling 1 million electrified cars and trucks per year in the United States and China by 2025.
On its investor day on Wednesday, GM announced plans to increase the manufacturing capacity of electric vehicles so that half of its factories in North America and China will be able to manufacture them by the end of the year. decade.
The company’s talk to investors is based on what it calls a “dual platform” strategy: Ultium batteries based on a skateboard-style chassis and Ultify, GM’s new software platform.
The uniform battery and chassis can be complemented by any type of vehicle, from a mainstream car to a luxury truck, resulting in “huge economies of scale.” . . as we go into production, ”said Mark Reuss, president of GM.
The uniform software platform, for gasoline and electric vehicles, would allow over-the-air technology updates and purchasing services, GM said. Barra compared the mix of hardware and software to smartphone technology.
She said GM could increase its share of the Tesla-dominated US electric vehicle market. Electric vehicles represent less than 3% of the overall national automotive market.
GM will seek new customers for at least some electric vehicle offerings. Reuss said the electrified Chevrolet Silverado pickup, which will be officially unveiled in January, “is going to be positioned very differently from our [internal combustion engine] Silverado. They are very different vehicles; they are very different customers. Still truck customers, but customers for the future of trucks. “
Barra and Reuss said advancements in the company’s hands-free driving technology will be part of the subscription services fueling GM’s revenue and profit targets.
The company called Ultra Cruise an “important step forward,” saying the technology could drive vehicles in “95% of driving conditions” when it launches next year. The current version of the technology costs customers $ 25 per month.