General Motors is getting into the electric boat business. Indeed, as the US auto giant pushes President Joe Biden’s blissful and ambitious plan to accelerate the introduction of electric cars, General Motors is also operating somewhat quietly in its quest to build electric planes, trains and delivery trucks — all powered by its own battery and hydrogen fuel-cell technologies.
Among the plethora of GM electric vehicles, you might actually get a chance to drive or ride in one of the new electric boats. The company recently announced that it has bought a 25 percent stake in Pure Watercraft, a Seattle-based startup that makes battery-powered outboard motors for boats. As part of the agreement, GM will supply Pure Watercraft with components at the same discounted price to its in-house divisions and help Pure Watercraft build its manufacturing network. After a GM investment of $150 million in cash and an in-kind investment, Pure Watercraft was valued at $600 million.
The two companies haven’t shared the specific products they’ll be working on together, but the team that developed GM’s Forward Marine First, an electric pontoon boat the company debuted at the Miami International Boat Show in 2019, will join the collaboration.
“Boats have historically benefited from advances in automotive technologies,” Andy Ripley, CEO of Pure Watercraft, told Recode. “They’ve been using car engines and car technology in boats for many years, and this is the embodiment of what’s happening in the age of electric cars.”
GM’s dive into the electric boat industry is a sign that the company is serious about its “all-electric future.” This commitment includes investing at least $35 billion to launch 30 models of electric vehicles around the world by 2025 – 20 of these vehicles will be available in the United States. General Motors went a step further this year and announced that it will phase out all of its gas and diesel vehicles by 2035 and make its operations carbon-neutral by 2040. Now the company is racing to build the tools and plants it needs to meet that goal.
Key to GM’s electric dreams is Ultium’s lithium-ion cell battery technology, which will be incorporated into a wide range of vehicles. In partnership with LG, the company is spending billions to build two battery factories in Ohio and Tennessee, which will be completed in 2022 and 2023, respectively. More battery factories could follow in the coming years. GM also entered into a strategic supplier agreement with semiconductor maker Wolfspeed earlier this fall to supply computer chips designed specifically for electric vehicles. And just last week, General Motors hosted President Biden at the grand opening of its newly renovated $2.2 billion electric car assembly plant, Factory Zero. GMC Hummer electric trucks and Chevy Silverado trucks will be among the first vehicles manufactured there.
“The reason electric cars always cost more than an equivalent internal combustion engine car is the battery,” Karl Brauer, executive analyst at automotive search engine website iSeeCars.com, told Recode. “Controlling everything related to batteries – production and cost – is probably the most efficient thing a car company can do in a world moving toward electric cars.”
As the company has doubled its manufacturing capabilities for electric vehicles, it has also designed components so that they can be modified to suit other forms of transportation. In particular, General Motors has invested heavily in hydrogen fuel cell technology, which uses hydrogen and oxygen from the air to produce electricity. (Unlike batteries, which store electricity directly, these fuel cells store hydrogen which is then converted into electricity.) The company has already found several customers for the technology, including truck company Navistar, aerospace equipment maker Liebherr-Aerospace, and freight train maker Wabtec, which uses Hydrotec fuel cells as well as GM’s Ultium batteries.
General Motors’ path to an all-electric future will not be easy. General Motors is competing with basically every old automaker in the world for its share of the electric vehicle market, and there have already been some pitfalls. Earlier this year, the company recalled all 141,000 Chevy Bolt electric vehicles it has produced since 2017 due to a battery fire risk. Meanwhile, recent start-ups in the field of electric vehicles are attracting a lot of interest and investment. Electric truck maker Rivian and luxury electric car maker Lucid rival or even lead stock price valuations for Ford, GM and Stellantis, which owns Chrysler, Dodge and Jeep. Nor is Tesla showing any sign of slowing down. The company plans to complete its new Gigafactory, an electric vehicle manufacturing plant, in Texas this year that recently became a trillion-dollar business.
Lots of other companies are working to carve out their own niche in the electric car industry. In addition to Pure Watercraft, the electric boat segment also includes a startup called Arc, which is building a $300,000 24-foot boat with a top speed of 40 mph. Several companies are working on electric semi-trucks, including Chinese automakers BYD and Geely as well as Tesla. There are also start-ups developing electric air taxis, some of which will also be independent. Palo Alto-based Kitty Hawk plans to launch its maiden flight within the next few months with CEO Sebastian Thrun as its first passenger. Some companies are even developing electric tractors.
But GM may be at an advantage. Biden has repeatedly expressed support for union-backed auto companies, and also credits General Motors CEO Mary Barra with stirring up “the entire auto industry.” The White House also does not have the best relationship with Tesla, which does not have a union and was not invited to the August White House summit on electric cars. At the same time, Biden’s spending package to Rebuild Better will provide, among other goals, additional tax credits on US-made electric vehicles made by union companies — which is exactly what General Motors is trying to do.
Then there’s the fact that General Motors is a century-old automaker that has built more than half a billion cars over the course of its commercial life. This experience could prove crucial as General Motors races not just its cars, but many different modes of transportation, into its electric future.
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