General Motors expects double-digit sales growth in Middle East and Africa this year
Detroit-based carmaker will begin deliveries of its new Bolt EUV in the region from September
General Motors intends to achieve double-digit growth in sales across the Middle East and Africa, with the help of its first electric sports utility vehicle to hit the market.
The Detroit car maker will begin deliveries of the new vehicle, the 2022 Bolt EUV, from September this year, an executive told The National.
“We have plans to electrify the regional auto industry ... Looking at the robust demand [and] growing appetite, we are launching the Bolt EUV here,” said Luay Al Shurafa, president and managing director of GM Africa and the Middle East.
Plans for the Bolt EUV were announced yesterday, building on the company’s push to launch an electric Hummer in the region next year.
The company will also make its OnStar technology available across its Cadillac, Chevrolet and GMC brands in four Gulf markets in the coming months.
OnStar is a subscription service that provides communications, security, navigation and diagnostics services.
“OnStar is a game-changing technology that will add to the users’ overall driving experience,” said Mr Al Shurafa.
GM, which last month celebrated the sale of its two-millionth vehicle in the region since 2000, unveiled its first electric vehicle – the Bolt EV – in the Middle East in 2017.
It can run for more than 520 kilometres on a single charge.
GM said in November that it would invest $27 billion in all-electric and self-driving vehicles through to 2025, an increase of about $7bn or 35 per cent, on initial plans announced in March last year.
The biggest US car maker by unit sales intends to release 30 new electric vehicle models around the world over the next five years.
“People are trying electric vehicles around the globe but still there is work to be done,” said Mr Al Shurafa.
Growth will be driven by a wider choice of vehicles, lower prices and longer ranges.
“GM is working to provide the required ecosystems for the growth [of electric vehicles]. One of the important enablers is increasing the variety and availability ... the second enabler is to overcome the range anxiety,” he said.
Range anxiety is the fear that a vehicle may not have enough power to reach a particular destination.
Mr Al Shurafa urged car makers to work with governments to overcome such anxiety by increasing the number of charging stations.
“[The] UAE is at the forefront of building the infrastructure and new announcements are also coming from Saudi Arabia," he said.
"There will be a time when it will grow faster than today ... we believe [a] complete future of all-electric is around the corner but it will probably vary from one country to another.”
GM last year unveiled its proprietary Ultium batteries to reduce the cost of electric cars and improve their performance.
Ultium batteries have large-format, pouch-style cells that can be stacked vertically or horizontally inside a battery pack.
This allows engineers to optimise battery energy storage and enables a range of up to 645 kilometres on a full charge.
“The Ultium platform will reduce the cost of the current Bolt by about 60 per cent and it will double the performance of the batteries,” said Mr Al Shurafa.
“Cost is a major component, and we see the cost of the batteries continuing to decline, making vehicles more affordable for customers in the coming years. Our approach is quite inclusive ... we believe that everyone should be able to afford an EV in future.”
Mr Al Shurafa said ongoing electrification efforts will boost the company’s balance sheet in the region.
While he did not disclose specific numbers in terms of regional sales, 2020 financial accounts filed last week showed that GM sold more than 3.4 million vehicles in Africa, the Asia-Pacific region and the Middle East last year, giving it an 8 per cent market share.
Globally, the company’s net profit to shareholders fell by 4.5 per cent from a year earlier to $6.4bn after revenue dropped by 10.7 per cent to $122.48bn.
GM had to suspend production for some time last year as a result of the pandemic.
Business picked up as the year progressed and the company reported a 21 per cent quarterly increase in revenue in Africa and the Middle East in the three months through to December 31.
Saudi Arabia, the Gulf region’s biggest economy, was GM’s key Middle East market last year, responsible for about half of its sales. It was followed by the UAE, Kuwait and Qatar.
“Saudi Arabia, from an industry point of view, is way down from its highest [level] back in 2015,” said Mr Al Shurafa.
“Currently, there is optimism in the market. Oil prices have started to climb and they have direct correlation with the car industry.”
Despite market headwinds caused by the pandemic in 2020, GM said it maintained a strong commercial position.
In the SUV segment, its models feature in the top five across its three biggest regional markets. Sales were driven by key launches such as the Chevrolet Captiva.
GM also bolstered its position after it released the latest models of the Chevrolet Tahoe, the GMC Yukon and the Cadillac Escalade last year.
“Just 60 days after launch, the sales figures are strong, with demand for all three vehicles outstripping supply,” said Sajed Sbeih, managing director for commercial operations in Africa and the Middle East.
Updated: February 15, 2021 03:51 AM