What's going on?
General Motors (GM) has the power… to one-up its rivals: the carmaker announced late last week it’ll boost its spending on electric vehicles (EV) through 2025.
What does this mean?
GM will top up the $20 billion investment it announced back in March with an extra $7 billion, which should help the carmaker reach its ambitious goal of releasing 30 new EVs by 2025. And since the majority of its new vehicles will feature the company’s upcoming Ultium battery cells, they’ll all reportedly have a range of up to 450 miles – even further than the 402 mile radius of Tesla’s Model S Long Range Plus introduced in June. Better still, GM says its new battery cells should bring the price of its EVs in line with the company’s current gas-powered models by the middle of this decade.
Why should I care?
Zooming in: Dream big.
There’s growing pressure on carmakers to phase out gas engines: just last week, the UK banned the sale of new petrol and diesel cars from 2030 onward. That means competition is fierce: GM’s EV spending is dwarfed by Tesla and Volkswagen, which is planning to invest $86 billion into EVs over the next five years. But all three are using the same playbook: they’re developing their own batteries – the most expensive component and most influential over profitability – rather than buying them from third-party suppliers.
The bigger picture: Dream green.
All this is in keeping with what BlackRock’s been seeing lately: the world’s biggest investment manager said late last week that investors have been allocating more than twice as much money to its funds that invest in climate change this year. It’s also noticed that companies focused on so-called “stakeholder capitalism” – that is, on serving the interests of all stakeholders – have been outperforming their stock market rivals.