GM Drops Ultium EV Brand, Promises To One Day Make Money On Electric Cars
Good morning! It’s Wednesday, October 9, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
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1st Gear: Mary Barra Promises GM Will Make Money On EVs Soon
America’s Big Three are having a tough time in the pivot to electric vehicles. Ford has lost billions through its EV production, Stellantis has faced issues shifting its battery-powered models and General Motors previously announced a renewed interest in hybrids because EVs weren’t selling in the number it hoped. Now, GM is ready to turn things around and has promised to be able to make EVs profitable… one day.
During an investors day talk earlier this week, GM CEO Mary Barra committed that her company would be able to make money off EVs soon, reports Reuters. Barra told investors that while the automaker was focusing on stability for its EV arm, sales for battery-powered models at the company were ramping up:
“I believe before the day is done, that you’ll agree that GM has plenty of upside relative to the consensus view that the auto industry has reached peak profitability,” Barra told investors.
Shareholders were eager for more details on the automaker’s restructuring in China, as well as updates around its Cruise autonomous vehicle operations, which have struggled since an accident when one of its self-driving cars dragged a person.
Barra said it is reducing inventories in China and improving sales, but didn’t give additional details on the restructuring efforts there. Cruise has resumed supervised driving in select cities, she said. Pressed for more details about Cruise, GM Chief Financial Officer Paul Jacobson said the business is expected to lose no more than $2 billion in 2025.
As part of restructuring at GM’s EV arm, the company killed off the Ultium branding that it has spent years developing. The EV architecture developed through the Ultium program will still be used in cars like the Chevrolet Silverado EV, Blazer EV and Equinox EV, however it will no longer carry the branding, reports the Detroit Free Press:
General Motors said Tuesday that it is dropping the name “Ultium” for its electric vehicle batteries and the technology that propels its EVs despite spending years and millions of dollars to promote the brand. The company said the batteries and technologies will remain, but the name “Ultium” will go.
GM also announced it will start building a battery cell development center at the company’s Global Technical Center in Warren. It did not provide a date for when it will break ground, but said the center will be a new building with a target of early 2027 to start building battery cells.
Despite the shake up in EV strategy at GM, the Free Press reports that the automaker remains on track to produce 200,000 EVs in North America this year. Perhaps more importantly for the automaker, the site adds that the “EV portfolio will reach positive variable profit this quarter.”
2nd Gear: Porsche recalls 27,000 Taycan EVs
While General Motors reaffirms its commitment to electric vehicles, Porsche has been recalling its EVs. The German automaker has been forced to issue a recall of more than 27,000 Taycen electric cars this week, reports Consumer Reports.
The recall of the Taycan is due to battery issues with the car that could lead to short-circuiting in some cars, Consumer Reports explains. The risk of short-circuiting in the cars’ batteries raises the fire risk ion certain models, as the site adds:
Porsche Cars North America is recalling certain 2020-2024 Porsche Taycan electric vehicles because their high-voltage batteries may experience a short circuit, creating a fire risk without warning.
Taycans with continuous over-the-air capability will be analyzed and monitored by the automaker. Porsche will install onboard diagnostic software in cases where no anomalies are detected, and the automaker will reach out to owners if a battery module replacement is recommended.
Nonconnected Taycans should be charged to only 80 percent of capacity to reduce the risk of a thermal event until the software can be updated locally.
The move follows a recall of the Audi E-Tron GT last year, which is built on the same platform as the Taycan. Audi issued a recall of the car in North America after problems were uncovered in the seals of the battery pack. This could let water into the cells, causing the cars to short circuit. Unsurprisingly, the Audi E-Tron GT is also impacted by this latest recall, which affects around 7,000 models sold in the U.S.
If you are worried that your car might be affected by a recall, there are a few easy ways to check. First up, the NHTSA has a super handy app that you can use to see if your vehicle is impacted by a recall, or you can head to the regulator’s website and plug your VIN into its recall search tool.
3rd Gear: Slow Charger Rollout Is Hitting America’s EV Adoption
Like it or not, electric cars are here to stay. They’re steadily gaining market share from their gas-powered counterparts, are receiving massive investment from automakers and governments around the world and are steadily winning fans. However, there’s one big obstacle still preventing mass adoption of EVs: charging infrastructure.
Now, a new study has found that America’s expansion of its charging networks isn’t happening fast enough and that’s putting the sector’s momentum at risk. According to a report from Reuters, “slower and more uneven” rollout of electric chargers could slow down growth of EV sales across the country:
U.S. registrations of electric vehicles hit just over 3.5 million as of September 2024, according to the Alternative Fuels Data Center (AFDC).
That’s up from 1.4 million registrations in 2023, and marks the steepest ever growth rate in EV uptake in the country.
However, installations of public EV charging stations have expanded by only 22% over the same period, to 176,032 units, AFDC data shows.
That slower charging infrastructure rollout risks causing backlogs at charge points, and may dissuade potential buyers from making EV purchases if they expect uncertain wait times when needing to re-charge their cars.
The impact of investment in charging infrastructure is easy to see, as states like California and New York top EV sales growth and also top the ranking for number of charging points. Clearly, if the rise of EVs is to spread further afield, widespread investment in more charging points is essential.
Another factor that will help maintain the momentum of EV sales will be additional incentives to sway hesitant buyers, adds Reuters. The coming weeks could be key to the future of tax breaks for EVs here in America, as presidential hopeful Kamala Harris is expected to maintain EV incentives, while convicted felon Donald Trump wants to slash support for electric cars.
4th Gear: Honda Isn’t Afraid To Backtrack Its EV Targets
Bringing us to a close on this bumper EV edition of the Morning Shift is Japanese automaker Honda, which has revealed that it’s not afraid to slash its EV targets and follow the rest of the industry in backtracking on electric car commitments. How very brave and noble of it.
The automaker, which currently markets the Honda Prologue EV here in the U.S., said it is “open” to revising its EV strategy to meet demand from buyers around the world, reports Bloomberg. Currently, the automaker is aiming to sell only battery-powered cars by 2040 but it admitted that there is flexibility in its targets:
“There’s enough room to adjust the time line of establishing EV factories globally and change our strategy should things move in an unexpected direction,” Chief Executive Officer Toshihiro Mibe told investors at Honda’s technology day last week. That could include delaying setting up some battery production lines, he said.
Automakers worldwide have been dialing back their EV ambitions as consumers cool on battery-powered car purchases, with affordability, a lack of charging infrastructure and range anxiety all key concerns. Volvo Car AB last month abandoned its target of selling only fully electric cars by the end of this decade while Toyota Motor Corp. is delaying the start of production of its first US-made EV until 2026.
Honda has a goal of only selling electrified vehicles by 2040. Mibe kept that unchanged for now, explaining away the current stagnation in EV sales as a “short-term headwind.”
If Honda were to change its tact on EVs, it wouldn’t be the first automaker to do so, heck it wouldn’t even be the first automaker to do so this week! Tuesday, Toyota announced it was pushing its EV commitments further down the road, following similar moves from the likes of Ford and even Aston Martin.
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