Building GM’s 100% Electric Cars
By George Harvey
Two recent announcements from General Motors (GM) have created quite a lot of talk. Both shed light on renewable power, but they were very different in their natures. One was about manufacturing, and the other about products.
The first announcement came in late September. General Motors said that it will power every manufacturing plant it has in Ohio and Indiana with wind energy. The 100-MW Northwest Ohio Wind Farm, owned by Starwood Energy Group, will supply all the power it produces to GM. Swift Current Energy’s HillTopper Wind Project in Illinois will supply another 100 MW.
This announcement was somewhat unsurprising, because the cost of electricity from wind farms has dropped to less than half that of electricity from combined cycle natural gas, the cheapest fossil fuel. Power purchase agreements from midwest wind farms are averaging below two cents per kilowatt hour (2¢/kWh), but the best prices from combined cycle natural gas are about 4.5¢/kWh. And while wind power is not steady in its output, that has proven not to be an obstacle.
The next big news story from GM produced a good deal more excitement, discussion, and speculation. GM is embracing electric vehicles for its future. In fact, the company’s executive vice president of global product development, Mark Reuss, said that GM is “committed to an all-electric future.”
This does not mean that production of internal combustion engines (ICEs) will stop overnight, but it does mean they will be rapidly phased out. Two all-electric cars are scheduled to be introduced next year, and at least 18 more are set to come out by 2023.
No date has been given for termination of production of ICEs. Reuss said it will not be like “flipping a switch.” The indications are that ICE production will end at different times in different countries, and the exact dates will depend on market and regulatory conditions.
GM makes about 10 million cars per year. Its largest market, in terms of the numbers of cars sold, is China, which is phasing out the use of ICE-powered cars. Other countries with similar policies for large markets include India, UK, and France. Also, a number of cities around the world have plans to ban cars with ICEs in the near future.
Clearly, it is necessary for GM to develop new products because of restricted markets. Other car manufacturers have already announced similar moves. Volvo, Volkswagen, and Daimler AG, the parent company of Mercedes-Benz, are all moving toward drastic reductions in production of ICE-powered cars.
GM has already had some experience with all-electric vehicles. The Chevy Bolt is a battery-powered car, but it is also a first entry. The new GM electric cars will need to be made more efficiently than the Bolt, because the company loses money on each Bolt it sells. Asked about this, Reuss said confidently, “This next generation will be profitable. End of story.”