Nov. 11 2010
GE says it will buy 25,000 electric vehicles, including 12,000 from General Motors, starting with the Chevrolet Volt in 2011.
GE plans to replace half of its 30,000-vehicle corporate fleet with EVs and will deploy another 10,000 electric vehicles for customers through its global fleet management business. The company says it will start by purchasing 12,000 vehicles from GM, and then buy additional EVs from other manufacturers as they become available. The company plans to try a mix of plug-in technologies, depending on its specific needs.
“Electric vehicle technology is real and ready for deployment and we are embracing the transformation with partners like GM and our fleet customers,” said GE Chairman and CEO Jeffrey Immelt. “By electrifying our own fleet, we will accelerate the adoption curve, drive scale, and move electric vehicles from anticipation to action.”
GE, of course, has a vested interest in the shift toward electric vehicles. It sells vehicle charging stations, circuit protection equipment and transformers that are key elements of the infrastructure needed to support electric vehicles. It also has a partnership with California-based Better Place to offer financing for battery purchases for Better Place’s battery exchange stations and is a major shareholder of battery maker A123 Systems. GE also has interests in smart-grid and power transmission technologies as well as the wind and solar energy industries.”
But without large-scale purchases like GE’s to serve as a market catalyst, electric vehicles could remain out of reach for many. “GE’s action is a critical step in the role that fleets can play in utilizing more than 20% of the announced battery manufacturing capacity by 2015, thus helping accelerate the scale-driven cost reductions in advanced batteries,” said Oliver Hazimeh, partner and head of the global e-Mobility practice at PRTM, a global management consulting firm.
GM chief executive Daniel Akerson called GE’s purchase a “vote of confidence” in the Chevrolet Volt, which is a plug-in hybrid that can go about 40 miles on electricity and has a back-up gasoline-powered generator to recharge the battery, extending the full range to 300 miles. The Volt goes on sale before the end of the year, and GM expects to sell 40,000 per year starting next year.
GE’s giant fleet purchase will help GM reach that sales goal and offset its big investment in pioneering technology, said Michelle Krebs, a senior analyst at Edmunds.com. “Automakers are unlikely to make money on new technologies out of the starting gate, but a big purchase like this helps accelerate their return on investment.”