GM is transforming into more than an electric car company. It's becoming a diversified energy company — selling battery technology and energy management services to power not just cars, but also trains, boats, commercial equipment and buildings.
Why it matters: Parlaying its battery and fuel cell expertise into other uses is a natural extension for GM, which aims to double annual revenue to $280 billion by 2030.
What's happening: The automaker is creating a new business unit, GM Energy, that will sell energy storage and management services to residential and commercial customers.
- With GM's new offerings, electric vehicle (EV) owners would be able to use their cars to power their homes during an outage, for example, or earn money by selling energy back to utilities during peak consumption periods.
- GM will also sell large, stand-alone batteries to commercial customers to store and manage power. (GM rival Tesla has had a solar energy and storage business for many years.)
- The idea, GM execs tell Axios, is that EV batteries — rather than straining the electric grid — could be used in "microgrids" to make the network more resilient.
Details: In one GM Energy initiative, the automaker is partnering with SunPower, a leading solar energy company, to sell a home energy system that will integrate EVs, solar panels and energy storage.
- The system will become available with the launch of the 2024 Chevrolet Silverado EV, which begins production in fall 2023.
The big picture: It's all part of GM's broader strategy to build an EV ecosystem — batteries, charging, connectivity and energy management — that it can supply to other industries as well.
- Some of the same EV technology behind the GMC Hummer and Cadillac Lyriq, for example, is used in electric pontoon boats, freight locomotives, off-road vehicles and airport ground equipment.
- Electrification components could be a $20 billion market by 2030, says GM, which is working with about 30 transportation-related companies to electrify their products.
- Another 35 or so companies are interested in GM's stationary storage and energy management, says GM vice president Travis Hester, who leads the company's EV growth initiatives.
- GM thinks that market is even larger — somewhere between $125 billion and $165 billion.
What they're saying: "This is a business model that is right in front of us," Hester tells Axios, describing the significant "white space" between electric vehicles and the energy grid.
- While other players are "piling in," he said, few have a full ecosystem that includes tech such as bidirectional charging and cloud-based energy management.
- "One day people are going to see GM as a tech company that can lead in these multiple areas where we have core competencies," Hester says.
Between the lines: GM's new unit is essentially selling energy security at a time when the grid seems increasingly unstable.
- The U.S. lost $150 billion in commerce last year due to power failures.
- In California alone, there were 25,000 blackouts lasting more than an hour in 2021, resulting in $15.5 billion in lost business.
Of note: Hester says GM's network of dealers will help market the company's home energy systems when they sell EVs, potentially earning commissions.
- That's important for dealers who are under pressure from manufacturers to adapt to the EV era and are looking for new sources of revenue.
The bottom line: Everything is going electric, and GM wants to power it all.
