You know everyone’s getting into the electric vehicle business these days, and much criticism is being leveled at the Detroit Three over their perceived reluctance to go full throttle into the business. In fact, GM had built a fleet of electric cars in the early 90s to test the market, the EV1, but concluded that the technology simply wasn’t ready. Some say it still isn’t, but the popularity of Tesla has dragged the industry into electric drive, ready or not. While the popular press and consumer attention is naturally pointed at high-performance electric sedans and environmentalism, the real sweet spot for electric vehicles with current technology may not be in passenger cars. Consider light commercial vehicles, especially vans. They’re ubiquitous on city streets everywhere, and they frequently have short distance, stop-start duty cycles that are ideal for electric drive. It’s also a market that Tesla doesn’t serve and has no announced plans to enter.
GM has noticed this, and a recent Reuters report states that the company is working on a project codenamed “BV1” to make what is presumably an electric cargo van along the lines of the company’s current Express/Savanna vehicles. In North America, you see Express and Savanna vans everywhere, serving everyone from small parcel delivery services to carpenters, plumbers and electricians. We know that the parcel delivery services will embrace electric, as Amazon has with a 100,000-unit order for Rivian, but will your neighborhood carpenter? GM appears to be betting on it, and they have some strong arguments. The key point is that light commercial vehicle buyers have buying preferences in America that are different from the rest of the world. Payload and towing capacity are major selling propositions here, and the body-on-frame GM vans can be configured to carry up to 4300 pounds and tow 10,000 pounds. These are medium duty truck numbers, and in fact are far beyond the requirements of most tradespeople and commercial users. As a result, these vehicles are overengineered for most uses, so much so that the basic chassis offered in a cutaway form for fitters to build into special-purpose vehicles like cube vans. So, what does this have to do with electrification? The strong body on frame structure of these overengineered vehicles is an ideal platform to carry a heavyweight battery pack. And the resulting decrease in payload and towing capacity will be irrelevant to most light commercial users. Not coincidently, GM’s new Ultium batteries are under development in 19 different battery/drive unit configurations for multiple GM vehicles, so the bulk of the R&D spending is already in process. Electrifying cargo vans is a low risk, high reward venture that hits Tesla in a market they don’t serve, and beats Rivian in a market where their major customer, Amazon, has locked up production capacity for a year at least. For GM, it looks like a pretty smart move.