Producing battery electric cars is an expensive business. In fact, most automakers who put one into production lose money on that model for years. This is mostly due to the high cost of the lithium-ion batteries that power the cars.
GM currently sells an electric car in the form of the Chevrolet Bolt. This small car has a lot going for it with a range of over 200 miles and a relatively affordable price tag. However, GM is currently losing money on this car. However, according to GM CEO, Mary Barra, the company plans to make a profit with electric cars by 2021.
According to insiders familiar with GM’s strategy, the key is to cut costs associated with battery production, specifically the amount of cobalt used in the batteries. Cobalt is the most expensive component in a lithium-ion battery and the price continues to rise. GM’s future battery design uses more nickel, which is both less expensive and produces more energy.
At the same time, GM engineers are working on ways to get more out of their batteries through more efficient packaging and improved energy flow.
Here at Dan Young GM, we are interested to see where this goal will take GM in the electric car industry.