GM dives into the home energy business in a bid to dethrone Tesla
General Motors is creating a new energy business to sell batteries, charging equipment, solar panels, and software to both residential and commercial customers. This is a board-based effort to create a range of accessories that can help sell its lineup of electric vehicles.
A new division at GM
The new division, aptly named, GM Energy, is also aimed at Tesla, which is a major force in the energy generation and storage market. GM has said it plans to overtake Tesla CEO Elon Musk in outright vehicle sales and will be able to challenge on this front as well.
Travis Hester, GM’s chief EV officer, said the company is making a serious grab for a piece of what is potentially a $120 – 150 billion market for energy storage and generation goods and services.
The main focus of the program is to make GM’s brand synonymous with a whole host of products and services that would orbit the EVs and their rechargeable Lithium-Ion batteries, not just EVs alone.
Keeping up in the marketplace
Hester has said that GM noticed Elon Musk’s moves in the energy markets and sees an opportunity for itself. Revenues in Tesla’s energy arm have been growing steadily over the last few years, to $866 million in the second quarter of 2022. In addition to Tesla, there are a host of smaller lesser-known firms that sell these products like Generac and Fluence Energy, which sell different energy product types, but both share in this home battery and solar panel products line.
“They don’t have a vehicle,” Hester said of those smaller companies, in a statement. “And frankly, they don’t have the dealer network that we have.”
“At that moment, that electrification moment, they have to decide how they’re going to run that vehicle,” he said. “They have to decide are they going to buy a standard charger for their home? Is it going to be a bi-directional charger? Do they want to add stationary storage as a fixed box? Do they want to do solar? And they can go as far into that ecosystem or as little as possible depending on their individual needs.”
How the new division will be set up
GM Energy will have three units: Ultium Home, Ultium Commercial, and Ultium Charge 360, which is the company’s EV charging system program. The GM Energy Division will sell a range of residential and commercial products and services, including bi-directional charging equipment, vehicle-to-home (V2H) and vehicle-to-grid (V2G) equipment, as well as stationary storage, solar products, software applications, cloud management tools, microgrid solutions and hydrogen fuel cells.
Some EVs can power a home
Many EV’s are being advertised as having the capacity to be a backup power source in the event of a blackout. The Chevy Silverado EV, sporting a 200kWh battery pack can power the average home for 21 days. This virtual power plant option is also part of GM Energy’s plan.
The future of GM Energy
GM is still testing its V2H service in partnership with California’s PG&E utilizing a small sample of homes in California and is planning to expand to more homes in 2023. The solar products won’t be available until 2024, which makes the launch for the major line of products still a ways into the future.
The automaker resisted calls from Wall Street to spinoff its EV business as a separate unit, arguing that plug-in power is GM’s future.
“It’s [GM Energy] not a business unit,” Hester said. “It’s our business as we go forward.”
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