General Motors (GM) - Get Report shares jumped higher Wednesday after the automaker unveiled a family of five electric vehicle drive systems that marks its most significant challenge to Tesla's (TSLA) - Get Report dominance of the clean-energy car market.
GM said its Ultium Drive series of five interchangeable e-axles, along with three battery-powered motors, will be compatible with a wide range of its current vehicle chassies, including pickup trucks and SUVs. Earlier this year, GM pledged to invest as much as $20 billion in its electric and automated vehicle division, which it hopes will ship 1 million cars each year in the U.S. and China by 2025.
“GM has built transmissions for many notable automakers,” said GM's Ken Morris, vice president of the group's autonomous and electric vehicle programs. “Making motors, transmissions, driveline components and systems are among GM’s best-known competencies, and our manufacturing expertise is proving not only transferable but advantageous as we make the transition to EVs.”
GM shares were marked 3% higher in early trading Wednesday to change hands at $32.56 each, a move that trims the stock's year-to-date decline to around 10.5%.
Tesla shares, meanwhile, reversed an earlier 4% pre-market gain to slide 1.6% from their Tuesday close, indicating an opening bell price of $442.31 each.
“As with other propulsion systems that are complex, capital intensive and contain a great deal of intellectual property, we’re always better off making them ourselves,” said Adam Kwiatkowski, GM executive chief engineer. “GM’s full lineup of EVs should benefit from the simultaneous engineering of Ultium Drive. Our commitment to increased vertical integration is expected to bring additional cost efficiency to the performance equation.”