09/23/2019

Cadillac, Tesla and the Long Road to Cheap Electric Vehicles

On Sunday, the eve of the Detroit auto show, GM unveiled early images of its first electric Cadillac. The company said Friday that its storied luxury brand would launch the first vehicle on its third-generation EV production system. Previous projects, the Volt plug-in hybrid and the Bolt battery car, have taken the Chevrolet badge. GM announced the strategy alongside surprisingly strong profit and cash flow projections that sent the shares up 7%.

The U.S. auto leader’s decision to lead its electrification charge with Cadillac won’t speed consumer adoption of EVs in the way environmentalists would like, but it makes business sense. Car batteries are still too expensive to put in a budget car that offers the kind of power and driving range American drivers want. Without aggressive regulation, manufacturers have little incentive to sell EVs except at high prices.

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