Detroit's largest auto makers ramped up plans for electric vehicles in coming years, the latest push from traditional car companies to respond to tougher emissions regulations and the prospect that some markets across the globe could eventually ban internal combustion engines powered with fossil fuels.
General Motors Co. plans to introduce two more electric vehicles in the U.S. over the next 18 months and 20 globally within six years, the nation's largest auto maker by sales said Monday. At the same time, crosstown rival Ford Motor Co. said it had formed a new team to help direct investments toward new electrified vehicles expected in the next several years. The Detroit-based group, called "Team Edison," will explore partnerships with suppliers and other companies, the auto maker said.
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The auto makers are investing billions of dollars in electric vehicles despite challenges turning a profit on them due to expensive technology costs that increase vehicle prices, and tepid consumer demand. GM and Ford are currently minting profits in the U.S. with fuel-thirsty pickup trucks and sport-utility vehicles that consumers find enticing amid low gasoline prices.
Electric vehicles account for less than 1% of U.S. sales, and a sliver of the nearly 90 million sold around the world. Infrastructure challenges remain, with additional charging stations needed to keep vehicles powered and avoid stranded motorists. Investors have bid up shares of Tesla Inc., pressuring traditional car companies, but the Silicon Valley electric-car maker consistently loses money.
Still, countries including China, the U.K., France and India have signaled plans to ban sales of vehicles powered with gasoline or diesel fuels in the coming decades. The head of California's Air Resources Board recently suggested the state could follow suit. That is on top of burgeoning negotiations among California, Trump administration officials and car executives over potentially relaxing tough future emissions standards that require companies to sell vehicles getting better mileage.
The upshot is car executives, even while highlighting challenges with market demand and lobbying for regulatory changes, are increasingly sounding bullish on electric cars and, in some instances, echoing statements from government officials.
"General Motors believes the future is all-electric," said Mark Reuss, GM's product-development chief, at the auto maker's suburban Detroit design center. He said GM's future electric vehicles would be profitable without further explanation.
GM's lineup will continue to offer hybrids and traditional vehicles reliant on gasoline and diesel fuels during what the company expects to be a prolonged transition to those predominantly running on batteries, Mr. Reuss said.
GM said it would use the underpinnings of the Chevrolet Bolt electric car currently on sale for coming vehicles in the U.S., though declined to discuss further details of their makeup. The auto maker also said it has developed a next-generation battery system that will allow for greater flexibility in electric-vehicle sizes and body styles in coming years.
GM said it would do more to expand the availability of charging stations to help spur consumer demand for electric vehicles, but didn't peg an investment amount or disclose specific plans. Volkswagen AG, stung by an emissions-cheating scandal, has begun investing in charging stations around the U.S. and expects to offer 50 electric vehicles by 2025. Tesla already has thousands of charging stations in its home country and elsewhere.
The market share of electric vehicles is expected rise in coming years as more models hit the market that can travel further on a single charge, boast better features, and, as the price of batteries falls, lower prices. But analysts predict it will take nearly a decade for the cost of electric vehicles to drop into the same ballpark as gas-powered cars.
Auto makers have historically lost money on electric cars. Fiat Chrysler Automobiles Chief Executive Sergio Marchionne once publicly begged consumers not to buy one of the company's electric vehicles, because the company lost $14,000 on each one.
China has been most aggressive in seeding an electric-car market through regulations and financial incentives for auto makers and consumers. In recent years, it has emerged as the top market globally for electric vehicles and plug-in hybrids, mostly low-price cars from Chinese brands.
GM said its next-generation battery platform would be offered in two vehicle heights, which would allow it to build both cars and larger vehicles, such as SUVs and vans. Most electric vehicles sold today are small cars. GM officials showed reporters fully built prototypes of three electric vehicles, including an SUV, a wagon and a podlike micro bus.
GM also reiterated its commitment to fuel cells, an expensive technology that produces electricity from hydrogen and oxygen.
Write to Mike Colias at Mike.Colias@wsj.com
(END) Dow Jones Newswires
October 02, 2017 15:52 ET (19:52 GMT)