GM: New batteries cut electric car costs, increase range

[JSH]

Originally Posted by redpoint5

In my estimation, GM has timed this 2nd attempt at EV a bit prematurely. They may have had extra motivation to redeem themselves from EV1, or are simply trying to get a first mover advantage to associate the brand when the market shifts rapidly. There's little to no profit in it at the moment though, and especially when operating at a $7,500 disadvantage from everyone else save for Tesla.

My guess is Toyota has positioned themselves just about ideally. Their RAV4 Prime has the minimum sized battery to qualify for the full federal tax credit, meaning the battery that probably cost them $2,500 is being subsidized for that cost plus $5,000 more. It goes 40 miles on EV, gets 40 MPG in hybrid mode, and has 300 horsepower. It's about the least cost to build a compelling vehicle to extract the maximum credit.

When full EV becomes profitable, Toyota will then be able to jump in. In the meantime, plug-in hybrids are the logical transition technology.

I agree if we are only talking about the US market. However, GM's largest market is China with 3.1 million vehicle sold in 2019 (40% of GM's global sales). GM sells 10 EV models there and is looking to maintain their position.

China is also the largest market for EVs and made up 1/2 of global EV sales in 2019. China is mandating 25% of auto sales be EV by 2025 so EV development is not an option. The US market gets some premium priced EVs as a bonus on the basic tech needed for China.


Toyota is going a different path and one that works well for their markets. They have added a hybrid option to almost all their mainstream models and now are starting to roll out PHEVs. This is sufficient to meet regulatory requirements in their major markets* and allows them to develop EV tech with the minimum amount of expensive batteries. (Toyota knows how to do EV efficiency - the Prius Prime is rated at 26 kWh / 100 miles which is the same as a Model 3 long range)

*Toyota / Mazda had the lowest 2019 average CO2 in the EU at 108 g/km CO2

The US market cruises along and doesn't really need EVs or even hybrids to meet our emission targets. The only curveball out there is CARB's ZEV mandate. So far auto makers have been meeting that with credits but those credits go away in 2025.