- GM told investors on Thursday that it could bring fleets of self-driving cars to market by 2019.
- The carmaker will generate far more revenue with this business framework.
- GM shares have rallied this year as the company has tempted investors with its plans for the future.
General Motors is going big with self-driving cars in San Francisco this week. The largest US automaker showed its autonomous Chevy Bolt electric cars to the media and on Thursday, the carmaker’s executive laid out a plan for more electric and autonomous vehicles.
According to GM President Dan Ammann, if GM can continue to evolve the fleet-based self-driving technology it has developed since its 2016 acquisition of Cruise Automation, waves of autonomous GM vehicles could appear on US city streets by 2019.
“General Motors’ executives clearly showed their sense of urgency to lead the autonomous vehicle market as it laid out its plans to analysts – plans that include self-driving cars for a ride-sharing service by 2019,” Michelle Krebs, an executive analyst for consumers site Autotrader, said in an email. “The question is: ‘Can GM deliver, and does Wall Street believe it?'”
Wall Street is currently trying to make up its mind. Despite the carmaker’s ambitious objective and three years of robust and highly profitable sales, the stock was in the doldrums until mid-2017, when a combination of GM’s plans for electric cars and self-driving vehicles set off a rally that took shares 20% higher.
Ammann cited a datapoint on Thursday that could get investors salivating.
A self-driving car in a ride-hailing or ride-sharing fleet could bring in far more revenue than a vehicle that’s sold or leased.
According to Reuters, Ammann said that “lifetime revenue generation of one of [GM’s] self-driving cars could eventually be in the ‘several hundred thousands of dollars,'” adding that GM now books only $US30,000 on average for a car that it sells.
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