Ride Sharing, Driverless Cars in GM’s Future
Detroit — General Motors will introduce a fleet of autonomous Chevrolet Volts in late 2016 on its technical center campus in suburban Detroit for employees to use, announced a New York City ride-sharing project and unveiled a concept electric bicycle as it expand its efforts to provide alternative mobility options.
In addition, CEO Mary Barra said GM’s joint fuel cell work with Honda will produce a fuel cell vehicle by about 2020.
Barra and other senior GM executives spoke to analysts and large investors Thursday at the company’s proving grounds in Milford, about 30 miles northwest of Detroit.
“We’re working to redefine customer’s choices and the future of mobility,” Barra said. “The convergence of rapidly improving technology and changing consumer preferences is creating an inflection point for the transportation industry not seen in decades.”
While moving in these new directions, GM also intends to cut $5.5 billion in costs from its traditional car and truck business between now and the end of 2018, mostly by reducing purchasing, manufacturing and administrative expenses.
GM and other established automakers have been introducing a variety of features in recent years aimed at enhancing safety and improving traffic flows in large cities. But the urgency has increased with Google’s development of a fully automated car, Apple’s intentions to develop its own vehicle in the next four to five years, and growing media attention devoted to Tesla Motors battery-driven luxury cars.
The growth of ride-sharing services such as Uber and Lyft, as well as the expansion of car-sharing networks such as ZipCar have driven traditional manufacturers to expand their own visions of transportation. GM launched a ride-sharing app in partnership with Google last year, through which drivers and riders can be matched for rides in Chevrolet Spark EVs, but it was essentially an experiment.
Now the automaker will offer Let’s Drive New York, a small-scale service initially available to eligible resident of the Ritz Plaza, a 479-unit luxury apartment building at Times Square. The residents can reserve a vehicle and access parking in one of 200 parking decks across Manhattan that are owned by Icon Parking Systems. The fleet is small, with only eight Chevrolet Trax small crossovers and two Chevrolet Equinoxes, but GM expects to expand it.
Residents who participate will receive electronic credits valid for three hours use per month. After that they can pay slightly less than $10 per hour of uses, or pay $75 for a 24-hour reservation.
GM tested the program earlier this summer and Ritz Plaza residents made more than 100 trips covering about 20,000 miles in New York, Connecticut and New Jersey.
In Europe GM’s Opel brand has recently deployed a service called CarUnity that enables dealers and fleet operators to provide a variety of vehicles for sharing. Earlier this year GM placed a fleet of EN-V 2.0 electric concept vehicles in service at Jiao Tong University in Shanghai.
The eBike concept Barra announced Thursday at GM’s global leadership conference, was created at its development center in Oshawa, Ontario.
“We are on the cusp of a sea change that will result in a new business model,” said Mark Reuss, executive vice president of global product development and supply chain. “But it is a change we will anticipate and we expect to lead.”
Daimler launched Car2Go. BMW has Drive Now. Earlier this year, Ford introduced Peer-2-Peer, a car sharing option being tested through November in Berkeley, Calif., Oakland, Calif., and San Francisco; Portland, Ore., Chicago and Washington, D.C., as well as London.
“Traditional automakers that don’t keep up with emerging autonomous vehicle technology will be left behind over the next 5-10 years,” said Karl Brauer, senior analyst at Kelley Blue Book.
The challenge is to provide new options that don’t rely completely on personal ownership without shrinking demand for the vehicles that generate the industry’s profits. GM President Dan Ammann showed a slide at Thursday’s conference showing that while large trucks, SUVs and luxury cars account for 14 percent of new vehicles sold globally, they generate 60 percent of the industry’s profits. With a few exceptions, they aren’t shared.
A study released last month by McKinsey consultants projected that global new car sales will soar from 70 million in 2010 to 125 million by 2025, but the way those cars are used and who will own them is going to change rapidly.
GM is investing $5.4 billion in 40 U.S. manufacturing sites over the next several years, but about two-thirds of that will go to three assembly plants in Flint, Mich., Fort Wayne, Ind., and Arlington, Texas, that build large pickup trucks and large SUVs.