General Motors Plans to Double its Revenue By 2030 With a Full Portfolio of Connected EVs

author: FutureCar Staff    

Automaker General Motors provided a detailed roadmap of how the company plans to double its annual revenue and expand margins to 12 to 14% by 2030, as a result of GM's transformation into a growth company driven by EVs, connected services and new business opportunities.

The automaker shared its plans on the first day of a two-day series of investor meetings Wednesday.

"GM has changed the world before and we're doing it again," said GM Chair and CEO Mary Barra in Michigan on Wednesday. "We have multiple drivers of long-term growth and I've never been more confident or excited about the opportunities ahead."

GM company leaders, many of which recently joined the automaker from companies outside of the auto industry, detailed how the automaker's hardware and software platforms will combine to create growth, expand margins, add new customers and diversify revenue streams.

"GM is unlocking a secular growth story that is changing the trajectory of our business," said Paul Jacobson, executive vice president and chief financial officer. "Simply stated, we are at an inflection point in which we expect revenue to double by 2030 while also expanding our margins. We will achieve this by growing our core business of designing, building, and selling world-class ICE, electric and autonomous vehicles, growing software and services with high margins and entering and commercializing new businesses."

GM's financial targets include doubling annual revenues from a five-year average of about $140 billion by the end of the decade. The company aims for its software and new businesses to grow nearly 50% CAGR through 2030. 

Maintaining vehicle margins is perhaps one of the biggest obstacles facing GM as its transitions to electrification. GM's current model lineup is dominated by highly profitable, full-size trucks and SUVs. The automaker's battery-powered models will not generate the same margins at least for now, due to the high cost of EV batteries and the billions GM is investing in electrification.

However, GM believes its transformation can deliver margins of 12 to 14% by the end of the decade with core auto business margins expanding as EVs scale, battery costs decline and the company ramps up higher margin software and new business platforms. 

GM envisions a future where connected vehicles and other new businesses drive more than $80 billion in new, incremental revenue with most of this growth occurring between 2025 and 2030. 

GM was one of the first automakers to offer connected services when its launched OnStar in 1996. It's grown to become the industry's leading connectivity platform with more than 16 million connected vehicles on the road. 

Part of GM's software and services growth will come from its new OnStar Insurance business, which is projected to have a potential revenue of more than $6 billion annually by the end of the decade. 

GM will be able to offer personalized insurance policies like Tesla that are based on driving behavior and data collected from its connected vehicles, instead of vehicle owners paying third party insurance providers.

In total, GM projects annual software and services revenue opportunities in the $20 billion to $25 billion range from a projected 30 million connected vehicles by the end of the decade. 

GM's "Compelling" New Electric Models

The most important revenue generator will be GM's core business of selling cars. GM projects its EV revenue to grow from about $10 billion in 2023 to approximately $90 billion annually by 2030 as the company launches what its calls are "several compelling EVs" in high volume segments.

The automaker has several high-profile EVs in the pipeline, including the new Cadillac Lyriq, Hummer EV and a fully-electric Chevy Silverado pickup, which is set to debut at CES in Las Vegas in January.

GM is also working with Japan's Honda Motor Co on a fully-electric SUV named the Prologue which will launch in the U.S. in 2024. Honda and GM are also co-developing a companion electric SUV for Honda's luxury brand Acura. Honda is using GM's Utium EV platform to underpin its first mass-market EV.

The 2023 electric Cadillac Lyriq will be one of many new EVs from GM.

Another revenue stream for GM its its autonomous ride-hailing business with its self-driving division Cruise. Cruise is outfitting a fleet of Chevy Bolt EVs for self-driving to be used in a commercial ride hailing service similar to Uber. The service will initially launch in San Francisco then scale to other U.S. cities.

Cruise will also deploy the multi-passenger Origin autonomous vehicle (AV) it co-developed with Honda for the ride-hailing service. During yesterday's presentation, Cruise CEO Dan Ammann provided investors with details on Cruise's commercialization efforts as it prepares to launch the Cruise Origin AV.

GM says its already has a market-leading position in autonomous mobility services, with the potential to deliver $50 billion in new revenue annually by the end of the decade.

GM is also expanding its logistics business BrightDrop, which is a new business that is building a connected and electrified ecosystem of delivery products and services for commercial customers. The automaker expects to deliver $5 billion in revenue by mid-decade and potentially $10 billion by the end of the decade when it is planned to approach 20% margins. 

GM is building an Ultium-powered EV600 full-size electric van for the BrightDrop delivery business, with plans to add a smaller EV410 electric van in 2023.

Also during Wednesday's presentations, GM also announced it is increasing investment in EV charging infrastructure to nearly $750 million through 2025. 

The EV chargers, which will be part of GM's Ultium Charge 360 charging network. It will cover home, workplace, and public charging throughout the U.S. and Canada. This investment will significantly increase access to reliable, public charging, which in turn can help boost GM's future electric vehicle sales.

In June, GM announced that its increasing its investments in electrification and autonomous driving technologies to $35 billion through 2025 as it plans for an all-electric future with dozens of new battery-powered models in the works, many with autonomous driving capability.

The massive investments in electrification, software and mobility services represent one of the biggest financial commitments in the automaker's 100+ year history, as it transforms its business and prepares for an electric and autonomous driving future.

FutureCar Staff