Incentives, credits, and compliance schemes can only get the electric vehicle market so far. The real test of its success will be when large, established automakers can get to a point when they can call them profitable.
On Wednesday, on a call with analysts to discuss the company’s fourth-quarter 2018 financial results, GM CEO Mary Barra said that’s a distinction that could come in the early 2020s.
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While Barra deflected a question about GM’s potential electric-pickup project, she pointed to GM’s battery-development partnership with Honda and its strong position in China. “So I think we’re in a good position, driving our cell costs down,” she said.
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Although other vehicles are still due to take advantage of the platform used for the Chevrolet Bolt EV, the first profitable electric vehicle from GM may have a Cadillac badge. GM revealed earlier this year that, with a vehicle to launch around 2022, Cadillac will be the “vanguard” brand for a completely new electric-vehicle architecture termed BEV3.
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In 2017, Barra called GM’s pivot toward EVs, autonomous-vehicle tech, and changing ideas about mobility “the biggest business opportunity since the creation of the internet.” At that time, Barra’s comments signaled a goal of profitability by 2021.
The company, which reported positive financial results for 2018 and for the most recent quarter, announced a massive restructuring in November, affecting thousands of manufacturing related cuts and five assembly plants at least temporarily shut down. It this week confirmed that 4,000 white-collar jobs are affected by this.
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“We are intent on reinventing personal transportation, capitalizing on a trillion-dollar opportunity, while making the world safer, better, and more sustainable,” said Barra.