http://seekingalpha.com/article/3577886-gm-would-be-smart-to-launch-an-e-pickup-truck-before-tesla GM Would Be Smart To Launch An E-Pickup Truck Before Tesla Oct. 16, 2015 Aurelien Windenberger
[images https://staticseekingalpha.a.ssl.fastly.net/uploads/2015/10/13/146134-14447520766804478-Aurelien-Windenberger.jpg (From the Via Motors site) https://staticseekingalpha.a.ssl.fastly.net/uploads/2015/10/13/146134-14447535456266046-Aurelien-Windenberger.png (From the EV-Fleet site) https://staticseekingalpha.a.ssl.fastly.net/uploads/2015/10/15/146134-1444940391458315-Aurelien-Windenberger.png (image from GM Presentation, via CleanTechnica) ] With gas prices under $3/gallon for most of this year, automakers have seen large gains in pickup truck sales in 2015. At the right price, an EV based pickup truck could be extremely popular, but so far two small companies are the only ones with e-trucks currently on the market. While Elon Musk has mentioned that Telsa plans to develop an F150 competitor in the future, the company's current focus is clearly on delivering the Model X and Model III. GM, Ford, or the other big pickup truck makers would be smart to develop a solid EV pickup as soon as possible, or risk losing the market to Tesla. American's have long had a love affair with their trucks and SUVs, but that affair was put on pause for a few years back in 2008 with the rise in oil prices and then the economic collapse. Sales plummeted over 50% and taken the last five years to return to their mid-2000's levels. Thanks to low gas prices, this year has seen continued double digit sales gains in the pick-up truck category. As someone that lives in rural Iowa, the appeal and utility of the pickup is obvious every day. Thus, I have been surprised at the seeming lack of interest from automakers in developing an all electric pickup. Here in Iowa and throughout most of the Midwest, the advantages (great torque and much lower cost of operation) of a solid EV alternative to the standard ICE offerings from General Motors (NYSE:GM), Ford (NYSE:F), Toyota (NYSE:TM) would outweigh any range anxiety factors, since almost all truck owners here also have a 2nd (and 3rd) vehicle, and the trucks are mainly used around the farm and to carry loads to and from the nearest town. With gas prices under $3/gallon for most of this year, automakers have seen large gains in pickup truck sales in 2015. At the right price, an EV based pickup truck could be extremely popular, but so far two small companies are the only ones with e-trucks currently on the market. While Elon Musk has mentioned that Telsa plans to develop an F150 competitor in the future, the company's current focus is clearly on delivering the Model X and Model III. GM, Ford, or the other big pickup truck makers would be smart to develop a solid EV pickup as soon as possible, or risk losing the market to Tesla. American's have long had a love affair with their trucks and SUVs, but that affair was put on pause for a few years back in 2008 with the rise in oil prices and then the economic collapse. Sales plummeted over 50% and taken the last five years to return to their mid-2000's levels. Thanks to low gas prices, this year has seen continued double digit sales gains in the pick-up truck category. As someone that lives in rural Iowa, the appeal and utility of the pickup is obvious every day. Thus, I have been surprised at the seeming lack of interest from automakers in developing an all electric pickup. Here in Iowa and throughout most of the Midwest, the advantages (great torque and much lower cost of operation) of a solid EV alternative to the standard ICE offerings from General Motors (NYSE:GM), Ford (NYSE:F), Toyota (NYSE:TM) would outweigh any range anxiety factors, since almost all truck owners here also have a 2nd (and 3rd) vehicle, and the trucks are mainly used around the farm and to carry loads to and from the nearest town. In this article I'll review the current E-truck offerings and discuss the importance for automakers of getting a model designed and into production before Tesla (NASDAQ:TSLA). Current US EV Truck Offerings Thus far, the only EV trucks I've been able to find for sale in the US are being marketed more as fleet purchases, rather than to individuals. This is understandable, as fleets typically have specific purposes which fit within the existing E-truck constraints, and fleet managers are more likely to understand the potential long term savings. The more normal looking option is the Via Motors VTRUX, which is designed in much the same way as the Chevy Volt. According to Gas2.org, the truck actually uses a Chevy Silverado standard frame and body, but instead of the standard ICE engine, Via installs their own hybrid power-train. This power-train includes a 23 kWh battery pack, along with a 4.3L V6 gas/electric generator that kicks in after the battery pack runs out around 40 miles and provides another 360 miles before the tank needs to be refilled. It also comes with a reasonable 1,000lb payload capacity, but no information on its towing capacity. This truck could be quite popular today, except for the fact that it costs $65,000. The other currently available E-truck is the Condor, made by EV-Fleet, a small company out of North Carolina. Unlike the VTRUX, the Condor was designed to be an EV from the ground up. This explains its unusual front, which is designed to minimize drag. The truck comes with either a 27kWh (50 mile range) or 50kWh (100 mile) battery, and also has a 1,000lb payload capacity. On their specifications page, EV-Fleet notes that the larger battery can do as much as 140 miles on one charge assuming the speed is kept to 45mph. This does make this truck particularly interesting for delivery type functions around a town or city. The truck is selling for $49,995, and is being marketed mainly to fleet managers. What I find interesting about this truck is that the extra cost (compared to a standard ICE truck) is made up within 5 years, assuming 15,000 miles/year. What Would it Take to Popularize E-Trucks The problem with the current offerings is that they are too expensive (VTRUX) or not well suited for the longer trips that individuals will want to take with their trucks (Condor). The Condor also has a very low maximum recommended towing capacity of only 1,000lbs. In order for the individual to see the value proposition, the truck would need a range of at least 200-250 miles, a towing capacity of 4,000 lbs+, and cost under $60,000. At that price, The truck would cost $52,500 after the EV tax credit, and match the total cost of ownership of a similar GMC Sierra 1500 (MSRP of $43,000) at 80-100k miles (5-7 years for most truck owners). After that, the EV's fuel and maintenance advantage would increase over time. What I find interesting is that the Tesla Model X actually comes pretty close to meeting these requirements, although of course within a completely different design. While the versions being rolled out today are the uber-expensive signature models, Telsa does expect to be selling the cheapest version next year at around $75,000. The 90kWh model provides a range of 257 miles, so the cheaper 70-75 kWh model will likely do around 215-225. Considering the amount of expensive features, such as the expansive windshield and falcon doors, that are packed into the Model X, I believe that Tesla could design a truck today that could be sold for $60,000 in 2017, while meeting the other requirements. Of course, this won't happen because the company must ramp up Model X production, and then finish designing and launching the Model 3. Thus, any Tesla truck won't be launched until 2019 or 2020 at the earliest. GM Should Take Advantage Today Automakers such as GM may not want to start developing e-trucks now, since their ICE trucks are currently generating great margins, but I would argue that getting out ahead of Tesla would be intelligent. So far, Tesla has created the highest rated luxury sedan ever with their Model S, and likely the highest rated SUV with the Model X. Based on these trends, I'm confident that Tesla will likely create an exceptional truck when they get around to it. Thus, it's imperative for other automakers to quickly develop and bring to market their own version of an e-truck as soon as possible. Considering their plans to release the all-electric Chevy Bolt in 2017, GM is likely in the best position to bring an e-truck to market before Tesla. As shown in their investor presentation a few weeks ago, the company expects their battery cells to be down to $120/kWh by 2020. Assuming 50% additional costs to put together the entire pack, a large 100kWh pack delivering at least 250 miles of range would cost them only $18,000. A truck with this size pack would have amazing torque, just what consumers are looking for. This would also leave GM plenty of money to build out the rest of the truck and sell it for a solid margin at $50-60k. GM might argue that consumers won't be interested in e-trucks now that gas prices are low again, but it's likely that gas will go back up again in the future once oil supply drops thanks to the low price. I also expect electricity prices to drop over time, as new solar and wind installations cost pennies per kWh of generation. This will lower the ongoing cost of the e-truck even more compared to the ICE models. Finally, trucks might end up being a much larger part of the total automobile market than today. Thought leader Tony Seba noted that he expects the total automobile market to shrink to 20% of its current size by 2030 in a keynote speech back in 2014. The reason is that self-driving cars will reduce the need for each of us to own their own vehicle. We would instead access a car from an Uber-like service only when we need it, thus reducing the amount of cars needed tremendously. Trucks, on the other hand, probably wouldn't see as large of a drop in demand because they are used in a lot of applications which would be challenging for an autonomous system. For example, driving down dirt roads, thru fields, and in other environments with no clear lanes to help guide the computer. Thus, it would be advantageous to take an early leading position within this market. Conclusion We haven't yet seen much interest from automakers in developing electric trucks, even though they would deliver larger environmental and cost savings then passenger cars due to their lower gas mileage. The current offerings are a start, but more targeted to fleet applications versus individuals. Once they prioritize development of a truck concept, Tesla will likely put together a compelling offering, but this probably won't happen for another 5+ years. This offers other automakers the opportunity to take the lead in sector of the industry. If they are interested, GM seems well positioned to take control. I am hoping to see positive steps in this direction, and would strongly consider taking a long position in the company if they announce a well designed electric truck. [© seekingalpha.com] For EVLN EV-newswire posts use: http://evdl.org/evln/ {brucedp.150m.com} -- View this message in context: http://electric-vehicle-discussion-list.413529.n4.nabble.com/EVLN-GM-Would-Be-Smart-To-Launch-An-e-Pickup-Truck-Before-Tesla-tp4678256.html Sent from the Electric Vehicle Discussion List mailing list archive at Nabble.com. _______________________________________________ UNSUBSCRIBE: http://www.evdl.org/help/index.html#usub http://lists.evdl.org/listinfo.cgi/ev-evdl.org Read EVAngel's EV News at http://evdl.org/evln/ Please discuss EV drag racing at NEDRA (http://groups.yahoo.com/group/NEDRA)
