A Refreshed Bolt Is Exactly What GM Needs Right Now
In GM’s recent Q3 earnings call, CEO Mary Barra revealed some interesting new details about the return of the Chevy Bolt. Based on what she said and some of the recent headwinds the EV market has been facing, it seems pretty clear that a new Bolt is exactly what GM needs. Let’s start with the details she revealed in the call!
What We Learned About The Next-Gen Bolt
Originally, GM was going to end Bolt and Bolt EUV production, replacing the vehicles with more expensive models. Supposedly, the Equinox EV was going to be a great replacement, starting at only $30,000. But, the plan was always to start with more expensive versions of the Equinox, so GM was going to abandon the $20,000 and $30,000 segments for a while, and then re-enter them at some point in the next few years.
Doing that might have made sense in 2021 and 2022, when demand vastly outstripped supply and everyone was jacking up prices. Used cars were often selling for more than new MSRP, and dealers were adding thousands (if not tens of thousands) to these already inflated prices. Even more strangely, dealers were selling them!
Now, as we get into the later parts of 2023, the situation has changed greatly. EVs are piling up on dealer lots instead of selling before they arrive. Everyone has dropped their prices, including Tesla. Ford has cut production of the F-150 Lightning, and Chevrolet is putting the Silverado EV off for around a year, and putting other new Ultium EVs (including the Equinox) off for several months to focus on profitability in production.
In other words, current market conditions simply aren’t going to allow manufacturers to sell super expensive electric trucks and SUVs. So, counting on being able to start at the expensive top and work their way down as volumes increase isn’t going to fly. For the EV transition to work, these companies are going to need to offer affordable models ASAP and rein in costs for the more premium offerings.
It was during this discussion that the return of the Bolt came up.
“Another key launch for us is the next-generation Chevrolet Bolt EV. I know there has been some speculation in the market as to why we are developing a new Bolt EV. Our strategy is to build — is to build on the tremendous equity we have in the brand and to do it as efficiently as possible.
“Our prior portfolio plans included several newly designed vehicles in the entry level segments and a capital commitment of $5 billion over the next several years. However, by leveraging the best attributes of today’s Bolt EUV, as well as Ultium platform, our software, and NACS, we will deliver an even better driving, charging, and ownership experience with a vehicle we know customers love. In the process, we are saving billions in capital and engineering expenses, delivering a significantly cost improved battery pack using purchased LFP cells. We are getting to market at least two years faster. And unit cost will be substantially lower.”
There’s a lot to unpack here.
First off, when discussing “prior portfolio plans,” Barra was referring to the recently-abandoned deal between GM and Honda to design and build cheaper EVs together. This left GM with a massive hole in the affordable market segments to fill, and right at a time when the company is seeing a greater need for budget EVs.
So, GM had to think fast, and Chevrolet already has a budget EV. But, let’s face it: the regular Bolt EV is kind of an ugly duckling. Americans want a more SUV-like hood, more interior space, and other crossover features. GM seems to be aware of this, because the execs decided it would be best to start with the EUV.
We have to keep in mind, though, that the EUV still has some serious shortcomings, even if it looks better. 55-kW CCS charging is a big one, especially when we consider the problems the CCS network is facing right now. It’s also got some pretty awful software (especially the companion smartphone app), and the battery cells aren’t going to be as profitable as GM’s Ultium cells.
To solve those shortcomings, GM plans to put as much Ultium technology as possible on the EUV’s platform, even if it’s not a total Ultium machine. This will mean faster charging, better software, etc.. Barra says the company is also planning on giving it Tesla’s NACS plug and access to the Supercharger network, so that problem is going to be solved.
But, in a departure from the company’s Ultium approach, it’s getting a revised battery pack with lithium-iron-phosphate (or LFP, LiFePO4) chemistry. This means better durability, lower costs, and better profits for GM.
Barra Hasn’t Announced Timelines
I reached out to GM and asked whether the delay in moving the Orion plant to Silverado EV production will mean more current-generation Bolt production. GM’s press people didn’t get back to me, but it seems unlikely that the Bolt will stay at the Orion plant, because it’s being prepped for something else.
So, GM is probably not going to restart Bolt EUV production with these new parts very soon. GM will have to revise the tooling and put it somewhere else, possibly in Mexico (to keep costs to a minimum).
But, guessing on how long this will take is difficult. If it was a completely new vehicle, it could be years, but it’s not. GM’s largely refreshing and upgrading the existing platform, which saves them “at least two years” in development. So, GM could surprise us with a much faster timetable than we thought. Or, the company could run into snags and take years. We just can’t predict this.
My best educated guess is that the GM team does it fairly soon. GM needs both to sell affordable and profitable EVs, and to not let companies like Tesla keep stripping customers away. It’s also important to meet emissions targets without delivering increasingly gutless ICE products to customers. GM’s leadership knows that delivering profitable EVs in every market segment is essential to their future, so they’ll have to get on that ASAP.
Featured image by Jennifer Sensiba.
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