General Motors Exec Predicts Automaker Will Be First To Profit From Electric Cars

2017 Chevrolet Bolt


General Motors, not Tesla or Nissan, will be the first to profit on electric car, predicts a top-level GM exec.

“We know the customers would like to drive electric but are unwilling to pay, and that’s why we’re going to be the first company to (produce) electric vehicles that people can afford at a profit,” states Mark Reuss, GM’s executive vice president for product development.

According to Reuss, General Motors is in the lead among automakers in regards to driving down electric vehicle costs.

Chevrolet Volt

Additionally, engineers are hard at work to remove mass and increase battery efficiency in GM’s plug-in offerings.

The goal is to cut costs so that the public can afford these long-range electric cars like the Chevrolet Bolt. Quoting Reuss:

“That’s the mantra inside product development. That’s what all our engineers are all working toward.”

Separately, we’ve heard news from South Korea, where the Bolt was developed and designed, that an engineering team is actively working on the Bolt with the sole focus on driving down costs so that the vehicle is more affordable to the general public. If a significant price cut is realized (the Bolt currently retails for $37,495 and up), then surely Bolt sales would rise.

Bolt demand is already incredibly strong in Norway (Opel Ampera-E) and in South Korea, where the Bolt sold out in a matter of minutes.

General Motors notes that Chinese production (and sales) of electric vehicles like the Buick Velite 5 will surely help the automaker in reducing battery cells costs.

The automaker adds that by deploying fleets of electric cars, like the autonomous Bolts, economies of scale are realized, thus further reducing costs.

Of course, no individual outside of General Motors has access to these cost/profits figures for individual vehicles, so we’ll just have to take (or not) GM’s word on this one.

Source: France 24

Category: Chevrolet

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79 responses to "General Motors Exec Predicts Automaker Will Be First To Profit From Electric Cars"
  1. Anthony says:

    If Tesla wasn’t trying to grow at a rediculois rate, I’m pretty sure they’d be profitable right now. But trying to build the GF, swallowing Solar City, expanding the supercharger network, and growing vehicle production by 5x, their balance sheet won’t be positive for a while.

    1. Roy_H says:


  2. Someone out there says:

    I’m waiting with excitement for the April Bolt sales figure. As I understand it sales has improved significantly this month. I’d like to see 3k sales but 2k is probably more likely.

    1. ffbj says:

      If they hit 2k that would be great, but since GM sales are down across the board, it seems unlikely.

    2. Stimpy says:

      1,292 Bolt sales in April. Damn…

    3. Tim Miser says:

      I bought one in April so we should see an increase.

      1. Michael Will says:

        Lol 🙂

        They could sell a ton if they were serious about marketing it, and the time to do this would be now before tesla model 3 shows up for the general public that didn’t reserve it yet.

        However they are too afraid to lose out on selling legacy gas cars with their attached long term revenue stream from oil changes and servicing and parts, and so they are missing this opportunity.

        If they are clever they drain their ice inventory and then ramp up bolt Volt and future electric vehicle sales.

  3. Pinewold says:

    Tesla has already profited from EV’s in q3 2016. It is also funny that the company that claimed they lost $10k per Bolt sold is now claiming to be the first to be profitable? No doubt when they go before the EPA to ask for relief, they will claim that EV’s are not profitable and not popular. The Bolt is another example of making too many compromises to be competitive. While styling is better the current Nissan Leaf, the overall feel is of a Honda Fit which has never been a huge success. Best way to prove limited market is to make a car with limited appeal!

    1. bro1999 says:

      Tesla has had 2 profitable quarters in its history. One in 2013, and one last year. Both times due to ZEV credit sales.

      When Tesla has a 4 consecutive profitable quarters, let me know.

      1. Nick says:

        Ahhh, They didn’t sell any EVs in those quarters?

        They also need 1 year of revenue without substantial investments before you’re interested?

        This reminds me of the same moving the goal posts strategy many EV detractors employ.

        “35 mile range? Need at least 100.”

        “Oh, you’ve got 100 mile range? Call me when you get 300.”

        “300 miles? On the expressway in winter while towing uphill and hauling at the axle limits? I’d need 500 mile range in such conditions anyway. Call me when you make a practical car.”

        “You’ve got all that? It better be cheaper than a used LEAF.”

        You can’t win with these people.

        1. floydboy says:

          He’s not so much of an EV detractor, as he is a Tesla detractor!

      2. Stimpy says:

        Do you consider Amazon to be an unprofitable company too because they spend on their money on long-term improvements?

        1. Ambulator says:

          Why would he think that Amazon is unprofitable? They’ve shown steady profits over the last couple of years, unlike Tesla.

          The fact that Tesla has rarely shown a profit in the past doesn’t prove they won’t in the future.

      3. Bacardi says:

        I won’t get into the reinvestments but I’ll say this, if in 2013 they had a profitable year, they would have most likely have been acquired and possibly the brand killed…The irony…

      4. (⌐■_■) Trollnonymous says:

        “When Tesla has a 4 consecutive profitable quarters, let me know.”

        Tesla sells only EV’s, so….

        When GM has a 4 consecutive profitable quarters on EV sales, let us know.

      5. Sean Wagner says:

        It helps that Tesla’s gross margins are at Porsche levels exceptional.

        Tesla’s legally binding filings with the SEC say so. Ad fontes:
        Automotive gross margin excluding SBC and ZEV credit – Non-GAAP
        Three months ended
        Dec 31, 2015 — 19.7%
        Sep 30, 2016 — 25.0%
        Dec 31, 2016 — 22.2%
        Source: Tesla Fourth Quarter & Full Year 2016 Update , Feb 22, 2017

      6. Serial anti tesla troll thomas says:

        I’m happy that I’m not the only one here who can read earnings report, cash flow statement and balance sheet ?

    2. Doggydogworld says:

      Tesla moved expenses and revenues around in time to engineer a small, single quarter profit. They are generally very unprofitable.

      GM never said they lose money on the Bolt. That’s fake news.

      Most of Bolt’s “compromises” are because it’s designed to be a Robotaxi (autonomous Lyft). Retail carbuyers are secondary, and are better served with a Volt, anyway.

      1. Ambulator says:

        Others have claimed GM loses money on the Bolt. I don’t know how they would know, though.

        1. Nick says:

          Be glad Doggydogworld wrote on an EV enthusiast forum that GM doesn’t lose money on the Bolt.

          I personally doubt that GM is losing money on the Bolt or the Volt at current cost. Sadly, my source is the same as Doggydogworld, and others here: rectally generated.

      2. Vexar says:

        Although true, they make it via ZEV credits only. They lose $9000 at every sale, make it up at the corporate level. Tesla also makes money off the ZEV credits but Elon Musk has said he would like to see the credit program eliminated. That is because his mission is on sustainability and the environment to the betterment of the species, not vast profits.

        To this end, I hope that GM makes actual at-the-sale profit on their EVs so they can start electrifying the rest of their offering. The sad reality is that the Bolt and all of what makes it even remotely modern is entirely from Korea (thanks, LG!). Because GM did nothing particularly on their own to make the car electric, there’s a middle-man they have to pay for so much of the vehicle.

        Someone wake me up when GM makes a profit on a $37,500 compact hatchback that doesn’t even come in leather at the $44,000 price point, sans any government programs. Until then, this is glib posturing by an organization that was eager to ask the incoming president to loosen controls around vehicle emissions.

      3. buu says:

        hey! how about reading article at top? GM expects to BE profitable, so you better tell them that you know they are profitable and can relax now 😀

    3. Someone out there says:

      GM has never claimed they are losing money on the Bolt. That was an “anonymous source” i.e. someone’s backside.

      1. floydboy says:

        Simply because GM doesn’t claim it, doesn’t make untrue!

    4. Nix says:

      pinewood said “It is also funny that the company that claimed they lost $10k per Bolt sold is now claiming to be the first to be profitable?”

      I think you may be thinking about Fiat. Their CEO actually made claims that they lost 10K or 14K per car. But GM never said anything like that.

      Or you may be thinking about the Bloomberg story which listed no actual source, and GM refused to comment on:

      “The Bolt’s anticipated per-sale loss of roughly $8,000 to $9,000 is an estimate based on a sticker price of $37,500, according to a person familiar with the matter. A GM spokesman declined to comment on the expected profitability.”

      That story is complete BS propaganda piece aimed at trying to support Trump reducing CAFE and other mandates, and bashing CARB ZEV mandates.

      GM definitely never said that, and taking the word of an anonymous source used in the middle of a hit piece is silly.

      One of the authors of that story has recently written 8 more pro-Trump stories about him gutting EPA regulations and bashing the CARB ZEV program.

      If you want to buy into that propaganda, knock yourself out. But it is incorrect to claim that GM is saying that they are losing money on the Bolt. There have been plenty of BS stories for the Volt claiming as high as $100,000 dollar losses on each Volt. All of them were widely debunked. The authors of this Bloomberg story provided zero information to back their sourceless claim, and even refused to provide support for their claim when challenged.

    5. unlucky says:

      GM didn’t really claim they lost money on each Bolt. They (Lutz specifically) said they spent as much developing it as you would on a more expensive car.

      This is because they expected to develop new technology on it that they would then use in other cars. So spending more than normal on the program made sense.

      And it seems to be working, Volt sales are clearly very strong around me. And while I know they need to expand to more than just a few areas, what they’ve done so far is also a great stop toward doing that.

      Other entities have claimed GM loses money per Volt sold. But we don’t really have a way to know that, we don’t know how GM cost-accounts the car. And even with that, if GM were to cost-account every dime of Voltec development to that car then that means the Cadillac PHEV and Malibu hybrid wouldn’t have to cost-account the development to their programs and thus would shift more profits over to those cars. In the longer run it doesn’t matter that much where you account the costs.

  4. GM: Profits Today!
    Tesla: Vehicles you want Today!

    1. bro1999 says:

      GM: 200+ mile, <$40k vehicle you can buy…Today!
      Tesla: ……….

      1. Brandon says:

        Yeah…. and who knows, but of all things the new LEAF just may be right there with Model 3 sales this Fall.
        It’ll be more attractively priced and possibly even more available by years end. We’ll see…

      2. Nick says:

        Tesla: You can take a road trip in our cars.
        GM: Bah, we don’t like EVs anyway.

      3. Jelloslug says:

        Just as long as you live in a special state or two. Call me when I can get one in my state.

        1. bro1999 says:

          I live in MD, and I got a Bolt in December. You just aren’t trying hard enough. 😉

        2. Zach says:

          Do you live in North Dakota? Because pretty much every other state has one.

          1. ffbj says:

            Not really.

        3. Nix says:

          Jello — The Bolt is indeed currently only available in 14 states, but by population those 14 states represent a much larger percent of the US population than just the number of states. They are also the states with the most EV sales. So availability to actual EV customers isn’t really a problem.

          It isn’t a big deal that you can’t buy one in Wyoming or Alabama, etc until September — those states aren’t exactly hotbeds of EV adoption in the first place.

          1. ffbj says:

            Nor are they CARB states, which is where the Bolt will be available first.

            1. ModernMarvelFan says:

              Virgina and Washington aren’t CARB states but they are already available.

              So, please stop your stupid BS over and over again. I am tired of correcting your crap here.

      4. says:

        So Bro, in a few months from now u going to hide under a rock?
        GM wants to make money on ev’s?
        Step 1….try to ficking sell them!!! Put some effort into it!

        1. Nix says:

          Mark, in bro’s (partial) defense, Robert set the format for bro’s response. It is not accurate for Robert to imply that there are not buyers who want to buy the Bolt. There are. And GM actually did beat the Model 3 to market. That’s simply a fact. GM had a window of opportunity where they had the price/range segment all to themselves.

          But yea, that window is quickly closing, and just being first won’t mean much by the end of the year if GM can’t capitalize on their opportunity. I’ll be the first to admit that my Bolt sales predictions have been disappointingly wrong. I predicted 2,000 Units in the first month (December) and I got it wrong. I carried over that prediction for 2 more months, and I was again wrong. GM will have squandered their first to market advantage if they continue on there current path and end the year under 20K units — while Tesla does more than 20K units in just the last half of the year.

          So while defending bro (partially), you are also (partially) right. bro is going to have a tough time continuing to use that line. If he keeps pushing that angle too much longer, he won’t like the backlash later in the year….

      5. Tesla8 says:

        A CPO Tesla for under $40K is better than a new Bolt…

        1. Nix says:

          A Tesla CPO under $40K would be a miracle. I’ve never seen it. Currently the cheapest CPO is 48K.

          Meanwhile, there are quite a few Bolts listed at $34K on that can be eligible for $10K in state and federal rebates, putting the price after rebate at $24K.

          I’m sure a CPO Tesla would rock.

          But getting 2 brand new Bolts for the price of 1 used Model S with 20K-50K miles is a worse deal? I’m not so sure about that.

    2. Goaterguy says:

      Lamborghini and Ferrari: Vehicles I want Today!
      Bank Account: Not so quick buddy!

      1. Kdawg says:

        I have no desire to own either of those cars. If I won one in a contest, I’d instantly sell it to someone.

        1. Mister G says:

          You can only take it home after paying $20k in sales tax lol

  5. Warren says:

    We all have another six months, or so, to fantasize about the coming EV tsunami. Enjoy it while you can.

  6. Jean-François Morissette says:

    Can we stop this childish fight between Tesla Model 3 and GM Bolt? We need both cars and many more. There are so many different ICE vehicles today because people have different needs (or perception of..). It has to be the same for EV. As Elon Musk already said, the competition is ICE, not EV for now.

    I am absolutely glad to see GM wanting to reduce cost of EV and make them affordable to more people, as I am also wishing Tesla to succeed and I thank them very much for putting pressure on traditional automakers.

    1. F150 Brian says:

      No need to stop. Ford, GM and Ram love the fact that their fans bash each other’s trucks because it keeps their brand at the front of the discussion.

      Keep the Bolt and Model 3 in everyone’s mind as the two to choose from!

      1. Brandon says:

        Good one!!

        And I the LEAF 2 I would add. I just think it doesn’t get the talking time it deserves.

        Nissan has been the leader in mass priced EVs, and its my opinion that they will continue to do so.

        1. Nick says:


          I’m very likey to pickup the long range LEAF mostly due to the nicer form factor, and better charging network.

          1. Jared Eldredge says:

            If my LEAF 1 experience counts for anything: don’t buy a LEAF 2.

            Absolute crap 35 miles range from fully charged (40mi on backroads only with max 30mph), no support from Nissan as they basically tell me to get F#$&’d

            Nissan has lost credibility, at least for me and anyone who drives my worthless heap.

            Don’t avoid EV, but I strongly advise to avoid Nissan.

            1. Mister G says:

              Nissan has dropped the EV ball, 7 years later and the Leaf has not changed, WTF

              1. Nix says:

                Actually I give Nissan full credit for trying to make the Leaf as profitable as possible by trying to hold costs down, and by trying to sell as many as possible before making changes that might reduce their profit margin (or increase loss). There is nothing wrong with that.

                The fact is that besides the Bolt, Nissan will STILL be towards the front of the pack in putting out a 200+ mile car (if they hit their September and end of year targets). They will be well ahead of many other companies. So I can’t fault them for somehow being a laggard, when so far only one other company (GM) actually sells a car like that.

              2. BenG says:

                New heat resistant battery chemistry, new higher capacity battery, new heat pump heater … Nissan made some decent incremental improvements over the years.

                And, as Nix says, assuming they make their September goal they’ll still be one of the first with an affordable 200+ mile EV.

                1. Brandon says:

                  Yup… just like they were the first with the gen 1 LEAF.

            2. Djoni says:

              The range is too low, albeit not as low as you mention.
              I do better in glacial winter than you claim, so you might be driving very hard or with heating at full blast, window open.
              Still it’s true that Nissan didn’t support their customer as much as they deserve it, but the car is good.
              It ride well, it’s comfortable and spacious.
              The look is correct when the car is clean.
              Nissan could have provided more improvement just by twitching the software.
              Isolate the battery pack and provide pre heat for it could improve the range in winter by more than 15% by reducing the battery inner resistance.
              The heating is poor in any year model and there is no good recirculation and insulation.
              But mostly, they do not allow better battery retrofitting like BMW, VW and Tesla are.
              Even today, I would consider replacing the battery with a bigger capacity before buying a new car.
              This car was trouble free, so the new Leaf is still a potential replacement.
              But I know what to look for now.
              A good deal by Nissan to previous owner and the guarantee that I can put a better battery if one comes.
              Although, if it comes with a 60 kWh or so, it won’t be much required to update.
              AWD and towing allowance would be considered.

  7. F150 Brian says:

    Everyone here should be excited about this news, regardless of who said it, because if true then there is actually a chance that electric vehicles can go mainstream.

    The tax payer can only prop up the EV market while it is a very small portion of the market.

    1. Nix says:


      This is nothing but good news, despite the announcement making it into some sort of competition.

  8. Malcolm Scott says:

    Of course they have to engineer out costs. In not many months the $7500 tax incentive finishes. It’s also priced rather high at the moment in Europe.

    1. ClarksonCote says:

      People need to stop looking at the cost of the car as just the sticker price.

      An LED bulb, for example, is more expensive than incandescent, but the savings over the life of the bulb is far greater.

      Similarly, an EV is a bit more expensive, but when you factor in the gas and maintenance cost savings, it’s cheaper than an equivalent gas counterpart.

      Now if they can get the costs lower to be equal to or better than an ICE, then sure, it’ll be a no brainer to purchase. But it’s surprising to me that so many still don’t see how affordable EVs are even today, looking at total cost of ownership.

      1. BenG says:

        People are short-sighted about finances as a rule, so it’s not surprising that the up-front cost is a bigger factor than on-going maintenance and fuel costs. And now with gasoline relatively cheap and a public policy likely to continue to that trend the fuel cost advantage of EVs is narrowed, especially if you compare to one of the new hybrids like the 4th gen Prius or the Ionique.

        And then you also have the various compromises that you have to live with if you buy a Bolt: it’s great for city/county/regional driving, but totally inadequate for long distance until a robust fast charge network is established, and even after that network is built out the Bolt will still extract significant compromise for long distance travel, having to stop for a 1/2 hour every two hours of travel is not a great way to cover distance, even if it is technically doable.

  9. Alan says:

    Not really sure how they can quantify their statement, how do they know for sure everyone else is losing money on EV’s ?

    Pretty sure Nissan is not losing money on their current leaf (I know they were not profitable early on) and I doubt the Renault Zoe is losing money either ?

  10. ffbj says:

    I don’t believe anything from GM. Past history is more than enough for me to cast aspersions on their pronouncements.

  11. Brian says:

    Fake news. Tesla already has positive margin on electric cars.

    1. Four Electrics says:

      Tesla calculates gross margin differently than all other automakers.

      1. Nix says:

        That is because Tesla is not like other car makers. Tesla owns their entire distribution, sales, and repair/service layers. Other companies do not, they have separate companies (dealerships) that own those layers of the business.

        This completely changes how Tesla actually profits. Because their costs and profits ARE different.

        When Tesla sells a car to a customer, they get all the profits from the sale. When traditional car companies sell a car to a dealership, they only get that profit. The dealership has an additional profit layer, and the dealership pockets that second layer of profit. Traditional car makers only get to book one of those profit layers.

        The same goes for warranty repairs. When Tesla has a warranty repair, they don’t pay another company per job to make the repairs. Tesla’s costs are basically at wholesale, where they pay overhead and salaries. For traditional ICE car companies, they have to pay retail for warranty repairs to the dealerships, where warranty charges include a layer of dealership profits. Those car makers effectively pay retail per job, because they are paying dealership profits on each job on top of actual expenses for the warranty repair.

        So yes, Tesla does it different. But only a brainless troll would imply that having a different business model that is inherently more profitable, somehow means that Tesla’s profit margin numbers on their cars are somehow invalid or wrong.

        1. theflew says:

          So Tesla forges aluminum and steel, has chemical plants for plastic, textile mills, etc…? Tesla does more final assembly, but they still buy a lot from suppliers. Doesn’t make them better, just different. Also if every automakers has abandoned Tesla’s level of vertical integration does that make Tesla the smart one or naive?

          1. Nix says:

            theflew — I’m not sure you read my post. I was talking about the post-production end of the equation, not about suppliers or manufacturing.

            My post was about Tesla not having dealerships, and how that greatly changes how Tesla books profits on each sale. Do you actually have a comment on what I actually said?

        2. unlucky says:

          Is Tesla’s model inherently more profitable? Not so far it isn’t. Because although they get to keep the retailer cut they also have to pay the costs that the retailer would pay. They have to buy/lease land, build buildings, pay retail employees and mechanics.

          In this stage especially, that of build-out, the model Tesla chose is less profitable. Later though, once they reach a stable size/footprint this could reverse.

          Just a nitpick, there’s no way automakers pay retail prices to dealers for warranty repairs. Sure, the dealers make money off warranty repairs, so they are applying a markup. But you can be sure they aren’t paying the same price on labor as dealers charge to customers. And they aren’t paying any markup on parts at all.

          1. Nix says:

            Yes, Tesla is paying up front to build out infrastructure to support future Model 3 sales that haven’t happened yet.

            The way warranty repairs work is fairly similar between car makers. The car makers document the warranty repair steps, and put a fixed number of hours of labor that they will pay, at a fixed hourly rate for the region. They have a warranty “book rate” they look up. This is what the dealership gets paid by the car maker. (The “book rate” used to actually be in a book given to dealerships. Now it is computerized.)

            The car maker doesn’t set salaries for auto technicians the dealership hires. The amount of money the dealership may profit is the delta between the book rate that the car maker pays, and the actual amount that the dealership pays the mechanic (plus overhead).

            The actual expenses the dealership has in doing the repair doesn’t change how much the car maker pays for the repair. The difference is dealer profit.


            Just to be pedantic, yes “customer pay” jobs tend to be more profitable. But if the warranty job actually takes longer than it should, the dealership typically pushes much of those costs onto their mechanic’s shoulders. The mechanic typically gets paid for the number of book hours the job given, not the actual number of hours. If a mechanic beats book time, they get paid more per hour. If the mechanic is slower than book, then the mechanic makes less. The dealership just has to manage the delta and the overhead in order to make a profit.

  12. ffbj says:

    Unsold vehicles are piling up at GM dealerships. I think Bolt sales will be about the same 1200 or so. In general we are going to slow down this year, as predicted. The good times are coming to an end for legacy car makers.

    1. CLIVE says:


  13. CLIVE says:

    I highly doubt that

    We’ll see

  14. CVVH says:

    Sounds like they are in track to do what I predicted, which is to significantly drop the price the Bolt, timed with Model 3 actually being available to purchase, so that the base price will be less than the Model 3.

    1. BenG says:

      Yep, that’s what I’ve been expecting too. The 2017 Bolts will be discounted in coming months, then the 2018 Bolt will get the 50 state roll-out, some minor tweaks and a price drop. I.e. I expect the 2018 Bolt to come with fast charge included at a retail price of $35k, and that $35k will get discounted later on down the line.

    2. Nix says:

      I agree, they will be discounting the price in one way or another.

      GM and/or Chevy dealerships pretty much discounts nearly every car and truck they sell off of MSRP. They also ramp up discounts pretty much every summer. Whether it is through direct discounts to customers, or sales incentives to dealers we can’t see (or both), people should be able to find some good deals this summer on Bolts.

      I do believe that GM has priced SOME flexibility into the BOLT MSRP for when the $7500 tax credit sunsets (or is killed). But I would be surprised to see a $5000 price cut, like we saw with the Volt one year.

      1. BenG says:

        I, on the other hand, do expect the $5k price cut on the Bolt at some point in the not too distant future. They will have to get the price down into the ballpark of other “hot hatches” to have real mass market appeal: that means in the ballpark of $25k for the Golf GTI. Looking forward to the day that the federal tax credit expires and there is competition from fully ramped up Model 3, Leaf 2, etc … GM will have to bring the Bolt down under $30,000 for sure.