How GM Plans to Grow the Electric Fleet Ecosystem

Ed Peper, U.S. vice president of General Motors Fleet, had a message to open the 2022 Fleet Forward Conference on Nov. 9: Some analysts are expecting a low range of 25% for electric vehicle adoption in the U.S. by 2030, he said. At GM, “We think it's going to be significantly higher than that. We think it's going to be at least 50% by 2030.”

This set the stage for an opening keynote dialogue with Peper, Michelle Calloway, director of OnStar Business Solutions, and Steve Hornyak, chief revenue officer for BrightDrop — and gave attendees in Santa Clara a better idea of the size and intricacies of the electrification evolution.

The trio discussed how a new electric ecosystem is growing to meet this goal, how GM is facilitating electrification with services beyond the vehicle itself, and how fleets play an integral part.

Peper broke down the facets of GM’s $35 billion investment in EVs by 2025: On the vehicle side, development hinges on the Ultium platform, GM’s modular EV propulsion architecture that houses batteries, drive units, power electronics and motors that are reconfigurable across a range of model types, from small crossovers to delivery vans. GM is planning to scale capacity for more than 1 million EVs in North America by 2025.

In 2020, Peper said GM set out to break down the barriers to EV acceptance in areas such as charging. The result has been a $750 million investment in charging infrastructure, including a partnership with EVGo to build 3,250 DC fast chargers in the top 52 U.S. markets and an agreement with Pilot Flying J to build a coast-to-coast network of 2,000 interstate fast chargers in major markets. GM’s more than 4,000 dealers will also each get up to 10 chargers to install in their respective communities (90% of all Americans live within 10 miles of a GM dealership).

“We're building a comprehensive charging solution from network creation to digital integration,” Peper said. “We have GM managed solutions across all fleet use cases.”

This holistic ecosystem of connected products and services is now part of the recently announced GM Energy, a new business unit providing connected energy management solutions for home and commercial applications as well as integration of third-party charging networks for public charging.

Peper said fleets will be able to consult with GM Energy on micro-grid applications for energy storage and off-grid charging. The unit can also help fleets customize charging schedules as well as optimize utility demand charges and peak pricing. In addition, OnStar Business Solutions will work with fleets to develop bundled cost estimates for vehicles, infrastructure, and smart charging.

“We are building an electric future now,” Peper said, before turning to a discussion with Calloway and Hornyak. “The urgency is there. Don’t wait to start. You have to start now if you haven't already, and I know many of you already have.”

Connected, Protected, Informed

Calloway stressed the connectivity component of the EV ecosystem.

Whereas OnStar has been seen traditionally as a retail play, OnStar Business Solutions will provide new offerings in the EV world for commercial customers around fleet management software, API and data services, and products such as a Wi-Fi hotspot with a mobile office. Through OnStar, fleets can also understand vehicles’ battery ranges and route them to chargers. “We're delivering on helping our customers be protected, connected, and informed,” she said.

Beyond these services, fleets can use OnStar’s connected vehicle data to match EV specs to the right use case and understand optimal cycling points when remarketing. On the safety side, fleets can also take advantage of OnStar’s in-cab driver coaching, particularly useful for drivers unfamiliar with how an EV operates.  

Regarding charging, Calloway addressed how OnStar can divide vehicle charging at home from the home’s utility bill, which allows the fleet to reimburse the driver for just the vehicle charging. “This is where the vehicle can really be that source of truth,” she said.

For public charging, the integration of third-party networks that Peper mentioned are tied into a single account. The account is charged when the vehicle plugs in.

With utilities’ rate structures fluctuating by the hour, smart charging at the depot is essential. Remote management through OnStar can mitigate peak demand charges and make sure vehicles are ready to go the next day, Calloway said.

Rethinking Delivery

Hornyak mentioned that the BrightDrop electric van was first seen publicly at the 2021 Fleet Forward Conference. That unveiling coincided with an acceleration of developments for GM’s commercial EV subsidiary. This included BrightDrop’s initial deployments to FedEx, new customer integrations with Walmart, Verizon, and Merchants Fleet, and leading up to the just-opened factory in Ontario, Canada that will build BrightDrop’s vans.

Hornyak said e-commerce is a main driver of commercial vehicle electrification, specifically as delivery cycles for retail orders have been compressed in the last few years. Consumers used to be satisfied with waiting a week for an item to be delivered; that timeframe has shrunk to within a day.

“It's a click and have-it now-society,” he said, which puts even more pressure on the entire supply chain and pulls efficiencies out of the last-mile delivery system.

As early EV adopters, retailers like Walmart are building their own electric fleets to vertically integrate and solve for these inefficiencies. Over time, total cost of ownership (TCO) for electric delivery vans is expected to pencil out, and for last-mile delivery, another benefit is removing tailpipe emissions from neighborhoods.

Avoiding Curbageddon

The continual increase in e-commerce is also forcing a reimagining of delivery logistics, particularly in dense urban areas. Hornyak served up a new buzzword, “curbageddon,” which speaks to the challenges of managing finite curb space used by all types of delivery fleets and the public.

This curb space is a revenue generator for cities like New York that count on tens of millions of dollars from parking fines, Hornyak said. It constitutes part of the city budget, and for fleets, it’s a cost of doing business.

BrightDrop is attacking this with a micro-mobility or “micro-containerization” approach. BrightDrop’s electric vans — or any type of delivery vehicle — can deploy Trace, BrightDrop’s electric-propelled delivery cart.

Pre-loaded and with a securitized chain of command, Trace can be used in many more ways than a rolling pallet cart. Electric propulsion opens a wider delivery area on foot for “runners” who can be gig workers, while drivers can manage the vehicle in the meantime.

Hornyak said early field tests have resulted in runners achieving 25% more efficiency in route delivery and fleets, achieving a 50% reduction in curb idle time. In analyzing early data for running electric vans, Hornyak said fleets can expect a $7,500 to $15,000 savings per unit each year in operating costs based on fuel and energy costs, and reduced maintenance expense. 

Another cost savings to consider is around insurance, as advanced safety features once found on luxury cars make their way into commercial vehicles and help to drive down the frequency and severity of crashes. In engaging with fleet customers, Hornyak said they’ll take “every single safety mechanism you can put on this vehicle, because we want to take care of our drivers and it helps employee retention and satisfaction.”

Big picture, Hornyak said combining EVs with a reimagining of delivery logistics can reduce the number of vehicles needed and drive down the cost of each unit of delivery.