- Chief executive showing off car at Las Vegas electronics show
- Bolt will travel more than 200 miles on a charge, company says
General Motors Co. Chief Executive Officer Mary Barra is making some big bets in a play to make her company a technology leader.
Barra, who was just given the chairman title in addition to being CEO, showed off the Chevrolet Bolt electric car on the heels of investing $500 million in ride-sharing service Lyft Inc. Both put capital at risk: The company has often lost money on electric cars and on investments in other companies.
These investments are about the long term and they show the patience Barra has when it comes to spending the company’s cash. She said GM has to spend money on nascent businesses and new technologies to get the automaker to the forefront, even if there isn’t an immediate return.
“This is an investment in the future and building a lead in electric cars,” Barra said of the Bolt. “We’ve made capital decisions when we need to for the future. This is the future.”
Barra has been trying to make a case that the century-old carmaker is a technology company since she took over as CEO two years ago. Combine the Bolt’s unveiling with GM’s investment in Lyft and it’s clear Barra is moving rapidly to try to prove GM is changing.
GM said the car will go more than 200 miles (320 kilometers) on a charge, double the electric-drive range of Nissan Motor Co.’s Leaf and not far from Tesla Motors Inc.’s Model S. Bolt production is slated to begin in late 2016.
Betting on the Bolt is smart, even if EVs don’t sell well and the car loses money, said Eric Noble, president of The CarLab, a consulting firm in Orange, California. GM lost $2 billion on the all-electric EV1, which was launched in the late ’90s, and the plug-in hybrid Volt, he said. While the Bolt also will likely lose money, GM can use the car to get zero-emission vehicle credits in California and keep selling less-efficient gasoline-powered cars, pickups and sport utility vehicles there, Noble said.
“The Bolt is a savvy move,” Noble said. “While it will certainly lose money, it eclipses any other automaker’s electric car because it’s affordable and goes more than 200 miles. It lets GM get an inordinate amount of electric vehicle credits and make money on other vehicles.”
The Bolt was first shown at the Detroit auto show last year as a concept, but GM gave little detail.
In her speech Wednesday, Barra took a shot at Tesla and its small retail network: “Unlike some EVs, Bolt owners will never have to worry about driving to another state to get service for their car,” she said.
Tesla said in an e-mailed statement that that traditional automakers’ plans “to build electric vehicles advance Tesla’s mission to accelerate the advent of sustainable transportation. We hope to see all those additional zero-emission vehicles on the road.”
Inside, it has low-energy Bluetooth technology that can read a driver’s smartphone and automatically send their music selections, phone list and other information to the car, personalizing the vehicle before the driver even opens the door.
This was designed especially for ride-sharing services like Lyft. Users of those services can now have the car set up their personal preferences for infotainment as they walk to it.
The Bolt also has a mapping feature specific to electric cars that tells the driver where to go to maximize the range of their battery. In addition, the car tracks driving habits and shows Bolt drivers how they compare to others when it comes to being the most efficient motorist behind the wheel.
The subcompact car has the interior space of a full-size vehicle, thanks to its microvan shape, according to the company. The interior room is ideal for urban dwellers who might need to borrow the car for shopping runs or weekend trips, said Pam Fletcher, GM’s chief engineer for electric vehicles.
‘Explaining to Do’
GM’s investment in Lyft fits well within the company’s profit expectations, Barra said.
“Every single capital decision we make looks at how will we make the right returns for our shareholders,” she said.
The Lyft investment is more risky because it’s a smaller player than rival Uber and GM could have invested far less, Noble said.
GM has invested in other carmakers over the decades and has often ended up writing down the stake and taking big losses. Most recently, GM bought a 7 percent stake in French carmaker PSA Peugeot Citroen for 320 million euros (then worth more than $420 million) only to write down half the investment later on.
“This is nowhere near GM’s core business and you don’t need to spend $500 million to get a window seat for something like Lyft,” Noble said. “It’s potentially a waste of money and she might have some explaining to do to shareholders.”