GE to buy 25,000 electric vehicles by 2015

Faith Merino · November 12, 2010 · Short URL:

Half of the cars will come from GM, beginning with the Volt

Chevy Volt

Looking to break into clean tech?  Electric vehicles and EV infrastructure are the way to go.  General Electric announced late Thursday that it will be buying 25,000 electric vehicles by 2015 in what many are saying is the largest order of electric vehicles ever. 

Of those vehicles, 12,000 will come from General Motors, starting with the much-talked-about Chevy Volt in 2011, and will add more vehicles as manufacturers design and engineer them.  The purchase is a strategic part of GE’s Ecomagination program to support the development of clean energy technology.

"With more than 16.3 million vehicles in operation in 2009, the nation's fleet can drive initial ramp-up scale in the battery industry and OEM supply chains,” said Fred Smith, CEO of FedEx and Electrification Coalition member, in a prepared statement.  “By buying these vehicles, GE is helping ramp up production which will help lower the price of vehicles and their components and make electric vehicles more visible and acceptable to the public at large.”

Additionally, GE boasts a portfolio of electric vehicle product solutions to support the EV infrastructure necessary for large-scale adoption.  Product solutions include charging stations, circuit protection equipment, and transformers.  GE anticipates that the electric vehicle market (including markets for GE’s charging station, WattStation) will generate approximately $500 million in revenue for the company over the next three years.

GE is also announcing the opening of two new electric vehicle customer experience and learning centers, which will provide customers, employees, and researchers with first-hand information about electric vehicles.  One of the centers will be located in Van Buren Township, Michigan, outside of Detroit, as part of GE’s Advanced Manufacturing and Software Technology Center.  The other will be located at GE Capital’s Fleet Services business headquarters in Eden Prairie, Minnesota.  The centers, more of which will be announced in 2011, will monitor electric vehicle performance and charging behavior, driver experience, service requirements, and more, while also creating an opportunity to compare and contrast different makes and models.

GE’s announcement comes two weeks after Ford announced that it would be investing $840 million in fuel efficient cars between 2011 and 2013.  A number of electric vehicle and EV infrastructure startups have been raking in funds as well, including Wrightspeed, a high-performance electric vehicle designer, which raised $5 million last week.  In September, Coulomb Technologies, a maker of electric vehicle charging stations, raised $15 million in a Series C round.

"Electric vehicle technology is real and ready for deployment and we are embracing the transformation with partners like GM and our fleet customers," said GE Chairman and CEO Jeff Immelt in the company’s announcement. "By electrifying our own fleet, we will accelerate the adoption curve, drive scale, and move electric vehicles from anticipation to action.”

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At the dawn of the energy age, there is increasing interest in minimizing the amount of oil used for personal transportation. With recent and ongoing advances in battery technology, the electric car is making a comeback. With 3 times the energy efficiency of the best hybrids (4 times better than fuel-cell vehicles), and the ability to use energy from any source via the existing grid, electric cars probably are the long-term solution. But oil is still relatively cheap, and batteries are still expensive. When the rising curve of oil price crosses the falling curve of battery price, there will be a mass market for electric vehicles. In advance of that market, we at Wrightspeed are developing advanced electric drivesystem technology, and making use of an interesting property of electric drivesystems: there’s no tradeoff between performance and efficiency. Internal combustion engine (ICE) cars have an intrinsic conflict: if they are built for performance, they are thirsty; if they are built for efficiency, they are slow. This is not the case for electric cars. Our Wrightspeed X1 prototype is faster than anything available except the Bugatti Veyron, yet it returns 170mpg equivalent in city driving. If we reduced the power to one quarter of the current power, the car would be correspondingly slower – but it would be no more efficient. This means we can design and build and sell very interesting cars – extremely fast cars – without compromising energy efficiency. The drivesystem technology we develop can be applied to other vehicles in the future, as economics permit. If reduction in fuel consumption is the goal, it would be better to replace 10mpg cars with 20mpg cars, than to replace 50 mpg cars with 100mpg cars. 5 times better. Counter-intuitive? Here’s the arithmetic. The 10mpg car uses 10 gallons to go 100 miles. The 20 mpg car uses 5: a saving of 5 gallons. The 50 mpg car uses only 2 gallons for 100 miles, so replacing it with a 100mpg car only saves one gallon. The fuel consumption problem is not that the current hybrid cars only get 50 mpg. That’s not where the fuel is going. Look around you on the freeway, and count the 10-15mpg cars. That’s where the fuel is going. If we can replace a 10mpg car with an electric car, at roughly 100mpg well-wheels equivalent, we save 9 times as much fuel per mile than if we replace the 50mpg hybrid commuter car. At Wrightspeed, we will do exactly that, starting with extreme performance supercars. And the improvements we are making in electric drivesystems raise the performance driving experience to a new level. Faster, more fun, and safer. We expect that some of these enhancements will eventually find their way into all cars.