GM to Add Hybrids as U.S. Gasoline Holds Above $4
General Motors will add hybrids in multiple segments, CEO Mary Barra told analysts Oct. 20, with US gasoline at $4.28 a gallon, up from $3.04 a year earlier. GM's US sales fell 6% in the third quarter, while Toyota's sales of electrified vehicles rose 28.5%.
"We will have hybrids," Barra said on the company's third-quarter earnings call, in answer to UBS analyst Joe Spak. She said GM will give more detail closer to launch. Barra said the hybrids will come in segments where GM already competes. She said much of today's hybrid activity is in compact cars, midsize cars and minivans, segments GM is not part of now. The hybrids "have already been added," she said, and will not require additional capital spending and engineering.
GM sold 670,974 vehicles in the US in the third quarter, 37,751 more than Toyota. Barra said the Equinox compact SUV is "fully maxed out even without a hybrid."
Bank of America's Alex Perry asked Barra how higher diesel prices are affecting GM's supply chain and heavy-duty demand. Barra said it is "early with the spike that's just happened in diesel." GM's diesels were more fuel efficient than a hybrid truck even before the spike, she said, so "cost of ownership was lower than buying a hybrid truck." US retail diesel has stayed above $6 a gallon since September, Reuters reported.
Toyota's electrified vehicle sales totaled 363,367 in the quarter, or 57.4% of its volume. Its total US sales rose 0.6% to 633,223.
Researchers at Resources for the Future estimated that about 56,000 US households that would have bought gasoline vehicles between February and May bought hybrids or electric vehicles instead, after gasoline rose from about $3.00 to about $4.50 a gallon. Of those, 38,000 chose conventional hybrids, and 18,000 chose electric vehicles, nearly all plug-in hybrids, Mohit Bisbey and Joshua Linn wrote July 9.
AAA's national average was $4.3413 a week earlier and $4.4761 a month earlier.
CFO Paul Jacobson told TD Cowen's Itay Michaeli that "with these oil prices and these fuel prices, EV penetration may continue to go up," and that GM wants to make sure it is ready for it.
