General Motors enters the electric boat business. While American auto giant President Joe Biden’s zippy and ambitious plan to accelerate the adoption of electric cars is advancing, GM has also been quietly building electric planes, trains, and vans – all self-propelled battery and hydrogen fuel cell technologies.
Of the wide range of electric vehicles in the works at GM, you might even get the chance to ride or drive in one of the new electric boats. The company recently announced that it has acquired a 25 percent stake in Pure Watercraft, a Seattle-based startup that makes battery-powered outboard motors for boats. As part of the agreement, GM will supply Pure Watercraft components at the same discounted price as its in-house businesses and help Pure Watercraft build its manufacturing network. Following GM’s investment of $ 150 million in cash and physical assets, Pure Watercraft is valued at $ 600 million.
The companies have not announced what specific products they will be working on together, but the team developing GM’s Forward Marine First, an electric pontoon boat that the company first debuted at the Miami International Boat Show in 2019, will join the collaboration.
Sign up for the newsletter
Recode
“Boating has historically benefited from advances in automotive technology,” Andy Rebele, CEO of Pure Watercraft, told Recode. “You have used automotive engines and automotive technology in boats for many, many years, and this is the embodiment of what is happening in the age of electric vehicles.”
GM’s entry into the electric boat industry is a sign that the company is taking its “fully electric future” seriously. That commitment includes investing at least $ 35 billion to bring 30 EV models to market worldwide by 2025 – 20 of these vehicles will be available in the US. GM went a step further this year, announcing it would phase out all of its gasoline and diesel vehicles by 2035 and make its operations climate neutral by 2040.
The key to GM’s electric dreams is Ultium lithium-ion battery technology, which is being incorporated into a wide variety of vehicles. Working with LG, the company is spending billions to build two battery manufacturing facilities in Ohio and Tennessee, which will be completed in 2022 and 2023, respectively. More battery factories could follow in the coming years. In addition, GM signed a strategic supplier agreement with the semiconductor manufacturer Wolfspeed at the beginning of autumn to secure computer chips that were specially developed for electric vehicles. And just last week, GM met President Biden at the opening of its newly renovated $ 2.2 billion electric vehicle assembly plant, Factory Zero. Electric GMC Hummer pickups and Chevy Silverado trucks will be some of the first vehicles made there.
“The reason that electric cars always cost more than comparable vehicles with internal combustion engines is because of the battery,” Karl Brauer, senior analyst at the automotive search engine website iSeeCars.com, told Recode. “Controlling everything related to batteries – production and costs – is probably the most effective thing a car company can do in a world that is moving to electric vehicles.”
As the company doubled its production capacity for electric vehicles, it has also designed components so that they can be retrofitted for other modes of transport. In particular, GM has invested heavily in its Hydrotec hydrogen fuel cell technology, which uses hydrogen and oxygen from the air to generate electricity. (In contrast to batteries, which store electricity directly, these fuel cells store hydrogen, which is then converted into electricity). The company has already found several customers for this technology, including the truck manufacturer Navistar, the aerospace supplier Liebherr-Aerospace and the rail freight company Wabtec, which uses Hydrotec fuel cells and Ultium batteries from GM.
GM’s path to an all-electric future will not be an easy one. GM is essentially competing with every legacy automaker in the world to get its share of the EV market, and there have been some missteps already. At the beginning of the year, the company recalled all 141,000 Chevy Bolt electric cars produced since 2017 due to a battery-related fire risk. Meanwhile, newer electric vehicle startups are attracting a lot of attention and investment. Electric truck maker Rivian and luxury electric car maker Lucid have rivaled or outperformed the stock price valuations of Ford, GM and Stellantis that own Chrysler, Dodge and Jeep. Tesla is also showing no signs of slowing down. The company plans to complete a new Gigafactory, an electric vehicle manufacturing factory, in Texas this year, and recently became a trillion-dollar company.
Many other companies are breaking into their own niche in the electric vehicle industry. In addition to Pure Watercraft, the electric boat sector also includes a startup called Arc, which is building a $ 300,000 24-foot boat with a top speed of 60 mph. Electric semi-trailers are in the works at several companies, including Chinese automakers BYD and Geely, and Tesla. There are also startups developing electric flying taxis, some of which will also be autonomous. The Palo Alto-based company Kitty Hawk plans to start its maiden flight with its CEO Sebastian Thrun as the first passenger in the next few months. Some companies even develop electric tractors.
But GM could have an advantage. Biden has spoken out in favor of unionized auto companies and also credits GM CEO Mary Barra for electrifying “the entire auto industry.” The White House also doesn’t have the best ties with Tesla, which has no union and was not invited to the August White House Summit on Electric Vehicles. At the same time, Biden’s Build Back Better spending package would, among other things, provide additional tax credits for electric vehicles built in the US and manufactured by union companies – which is exactly what GM is trying to do.
Then there’s the fact that GM is a hundred-year-old automaker that has made more than half a billion vehicles over the course of its corporate life. This experience could be crucial as GM tries to integrate not just its cars, but many different modes of transport into its electric future.
This story was first published in the Recode newsletter. Sign up here to not miss the next one!
