Will there be a $30,000 EV?

GM’s language leaves some wiggle room

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On a national morning news show last week the fabric cover was pulled back. The big reveal was the car GM promises will bring the electric vehicle to the masses. It was a bright blue Crossover SUV. The new TV commercial calls it the, “EV for Everyone.”

General Motors says its base model Chevrolet Equinox will cost just $30,000 when it’s available late next year. That is the sweet spot for new car purchases. Crossover vehicles of this size make up more than 20% of the new car market, according to GM. The price point GM is touting means an EV will cost about the same as an internal combustion engine vehicle.

Interior of the GM Equinox with a screen the CEO talked about in several interviews. (Credit: GM)

In appearances unveiling the Equinox, GM’s CEO Mary Barra was beating the drum for this new vehicle. “It’s loaded with technology- it has a 17.7 inch screen- ‘Super-Cruise’ (the driver assist system) is available.” She added this new vehicle will, “surprise and delight our customers.”

THE PROMISE

Barra promised an Equinox at this price back in January at the Consumer Electronics show. While her style is calm and straight forward, Barra has been sending a message that GM intends to be the largest maker of EVs in the US by dethroning Elon Musk’s Tesla.

GM's new commercial claims the Equinox is the "EV for Everyone." (Credit: GM)

There have been plenty of predictions of an affordable EV. Musk promised a $35,000 Tesla. For a while Tesla offered a Model 3 (standard range) at that price. That offer was pulled 18 months later in 2020 and now the base Model 3 starts at $48,500.

BATTERY PLATFORM

So how is GM going to produce what it calls, “An Affordable, Functional and Stylish EV,” for $30,000. Barra says costs have been driven down by its work the past four years on its battery platform called Ultium. The battery pack (made up of many separate cells) is part of the chassis. It’s a bit like putting Legos together. It’s modular, so a chassis can be used for many models. If the vehicle needs additional battery cells they can be added easily.

Examples of the GM platform called Ultium. The battery pack is an integral part of the chassis which can be used for several models. (Credit: GM)

GM has changed the chemistry of its batteries as well. Barra says the move from the second generation Ultium battery to the third generation has resulted in a 40% cost savings. “Ultium is scalable, “ Barra told CNBC. “I see tremendous opportunities to still get costs down, “ she added.

GM video on its Ultium battery cells which are now being produced in Ohio. (Credit: GM)

This affordable Equinox is a priority for Barra. She says GM wants to make EVs “attainable” for the average American. Her declaration of this affordable vehicle earlier this year and its unveiling last week have been received warmly. Can GM deliver?

WIGGLE ROOM

If you listen to the company’s language, GM has left itself a little wiggle room. When Barra talks about the Equinox she says the price will be “around” $30,000.

GM CEO Mary Barra unveils the Chevrolet Equinox EV during an appearance on CBS Mornings. (Credit: CBS News)

During a briefing with reporters before the unveiling, Vice President of Global Sales Scott Bell said, according to The Verge, “We have every intention to build and sell the vehicle that will start in that price range.” He then used the tagline from the new ad, “So that is critical to the success of what we’re doing at Chevrolet — building an EV for everyone.”

GM has set the bar high to do just that- build a vehicle in that sweet spot of $30,000. By this time next year we will learn if they are able to keep their promise.

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(Cover image credit: GM)