GM has finally admitted that the Chevrolet Bolt was never a profitable car.
While everyone is going gaga over Tesla Model 3s, General Motors has quietly been toiling away with their Chevrolet Bolt. Even before Tesla managed to make more than a handful of Model 3s at a time, the Bolt was being churned out in the thousands to expecting green transportation hopefuls that wanted an easy way of getting around town that didn’t involve burning dead dinosaurs.
However, GM made certain sacrifices in making the Bolt. In order to get their car to market quickly and start selling to the millions of Americans that wanted a gasoline alternative, they sold cars at a loss with the expectation that battery prices would come down. Batteries are easily the most expensive component of an electric car, and so as battery technology improved so too would their manufacturing costs.
And battery costs have come down, but not as fast as GM would have liked. A 2016 report from Bloomberg said that GM was losing between $8,000 and $9,000 per Bolt sold. A 2017 teardown by UBS found that the number was probably closer to $4,000 or $5,000, but either way, GM was losing money on each Bolt that left the dealer’s lot.
GM never commented on the Bolt’s profitability, but now we have a pretty good indication that reports of the Bolt's profit-losing are indeed accurate.
Speaking to investors at GM’s quarterly reporting, GM head Mary Barra said point black that she doesn’t expect electric cars to start being profitable for GM until the end of the next decade.
"We've talked about the fact that with our next generation of development, we want to make sure we have obtainable, profitable, desirable, and with the appropriate range," she said.
Rather than focusing on mass-production models, GM will instead switch to luxury brand Cadillac for their next EV. Luxury models command a much higher premium and are therefore much easier to turn a profit. Cadillac will use GM’s new electric platform and will come in the shape of an SUV--the most popular body style for luxury vehicles at this time.