Is General Motors serious about electric cars? It sure looks like it.
Believers in the Electric Vehicle Revolution cheered this week's news that, as it prepares to begin selling its Chevrolet Volt electric car to consumers, GM is also investing in Hoosier startup Bright Automotive. The companies aim to bring a plug-in gas/electric hybrid van to market in 2013. A van that, like the Volt, runs on batteries first (for 38 miles), then switches to a gasoline engine to generate juice for an additional 360 miles. A van that could, incidentally, blast Ford's (NYSE: F ) new electric Transit Connect van right outta the marketplace -- seeing as the TC's all-electric engine has only an 80-mile range.
So hurray for GM. In tandem with its development of an electric car "for the masses," it's now also targeting the market for electric delivery vans. But don't go storming the barricades just yet.
PC or PR?
Sure, at first glance this looks like absolutely the (b)right idea. (Incidentally, that's the name GM and Bright have chosen for their truck: the "Bright IDEA.") I shudder to think how much gas gets wasted every day by delivery vans idling at the curb as their drivers dash to the door to drop off packages. Recouping those costs by buying vans you can turn off and on at the touch of a button has to sound like a no-brainer to the accountants at FedEx (NYSE: FDX ) and UPS (NYSE: UPS ) .
Indeed, we know both companies are already investing in the concept. We also know that companies ranging from battery makers like A123 (Nasdaq: AONE ) and Ener1 (NYSE: HEV ) to automakers like Toyota (NYSE: TM ) and Tesla (Nasdaq: TSLA ) are placing big bets on electric vehicles becoming the wave of the future. So on the one hand, GM has fiscal rectitude on its side. On the other hand, it's most definitely "politically correct."
But what about the third hand? As big as this idea is, I can't help but notice that the size of GM's investment in Bright is exceedingly tiny: just $5 million. That's less than what GM would pay for a minute's worth of commercial airtime during the Super Bowl. For a company that hit up U.S. investors for tens of billions of dollars, $5 million isn't an "investment" in electric vehicles. It's chump change.
Then again, maybe that's GM's brightest idea yet. At this price, it doesn't matter whether the new van succeeds or not. GM's bought itself some good PR, at a very good price.