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General Motors unveiled its all-new modular platform and battery system, the Ultium, on March 4, 2020 at the Technology Center campus in Warren, Michigan.
Photo by Steve Fisht for General Motors
General Motors CEO Mary Barra on Wednesday again pushed the company to back out of its fledgling electric car battery business.
Barra said retaining the unit within GM would create more value for the company than separating it.
“For an electric car, it’s all about the battery,” she told CNBC’s “Squawk on the Street.” “I think keeping this technology close and leveraging the deep battery expertise we have at GM is how we’re going to accelerate the creation of that value.”
Barra has promoted the company’s plans to sell Ultium battery cells as well as Hydrotech fuel cell technology to other companies. General Motors has a deal with Honda Motor Co. for two EVs. This week, the company also announced the signing of a Memorandum of Understanding with General Motors to engineer and supply the Ultium battery and Hydrotec systems for Wabtec freight locomotives.
CNBC’s Jim Kramer told Barra that he thinks the battery business could be more valuable than the entire automaker, which has a market capitalization of about $90 billion. He wondered why investors should not be allowed to buy into the battery business.
General Motors does not currently produce its own battery cells for electric vehicles. It has announced plans to build four plants for this production, including two currently under construction in the United States through a joint venture with LG Chem by 2025.
Speculation and pressure from Wall Street about a possible split in GM’s electric car operations has been rampant for some time. Deutsche Bank said such a company would likely be valued at at least $15 billion to $20 billion, and could be worth as much as $100 billion.
GM President Mark Royce said in November that the automaker had analyzed the split’s potential and determined it wouldn’t be the right move for its business. He cited the cost of the subsidiary as well as the benefits of making EV operations part of the larger company.
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