GMC eyes electric truck market leadership, competing with Tesla, Ford, Rivian

MILFORD, Michigan — General Motors Premium brand GMC hopes to become the leader in all-electric truck sales to U.S. consumers with the launch of its new electric Sierra pickup.

Sierra EV joins the electric version HummerThe Sierra, which includes an SUV and a pickup truck, is part of GMC’s electric “truck” lineup. The automaker expects the Sierra to be a best-seller in GMC’s electric vehicle lineup as a lower-priced model is introduced next year. The “Edition 1,” which costs about $100,000, recently began to meet customers.

“We think this is a product that is radically different than anything that anybody else has put out before,” Duncan Aldred, global vice president of GMC, told CNBC in an interview at GM’s proving grounds in suburban Detroit. “So we feel very confident in the demand in the market.”

GMC didn’t reveal a timeline for when the brand expects to lead in retail electric truck sales. But to do so, it will have to outsell its sibling, the Chevrolet Silverado EV, and the EV from Ford Motor, Rivian and TeslaThe company’s Cybertruck sales topped its class in the second quarter, Motor Intelligence reported.

Aldred said he believes there will be cross-buying between the Sierra and Cybertruck, but he doesn’t necessarily consider them major competitors, even though the two vehicles are priced similarly. He cited internal data that many Cybertruck buyers already own Teslas, while about 80% of GMC Sierra reservations previously owned non-GMC vehicles.

“We know that about 70% of Cybertruck buyers are Tesla owners,” he said at a media event. “So, they’re not necessarily truck buyers, they’re Tesla buyers.”

The rush by GM and other automakers to introduce all-electric pickup trucks, prompted in part by Tesla’s plans to build such vehicles, has led to concerns that the U.S. electric car leader will dominate the truck market, which is as critical to the Detroit automakers as it is to electric vehicles.

But the popularity of electric vehicles Slower than many expectedthe electric truck market is still in its infancy.

The all-electric pickup truck market, which includes retail and fleet sales, totaled about 38,500 units in the first half of this year, according to Motor Intelligence, compared with more than 1 million conventional or hybrid full-size pickup trucks sold through June this year.

According to Motor Intelligence, the all-electric pickup truck sales leader through June is Ford’s F-150 Lightning, with 15,645 units sold. Tesla Cybertruck Sales in that time were close to 11,600, including an industry-leading 8,755 in the second quarter, according to the automotive data and analytics company.

GMC’s Hummer pickup production and sales have been growing slowly, with the latest sales of less than 1,500 units, including about 1,100 in the second quarter, according to Motor Intelligence.

“This is a very emerging market. It’s just the beginning. GM is confident it can be a leader in this space because of their history in trucks and their understanding of the transition to electric vehicles,” said Stephanie Brinley, lead automotive analyst at S&P Global Mobility. “The big question right now is how quickly consumers (accept electric trucks), not product attributes.”

If all-electric SUVs from major brands are included (which companies like General Motors count as truck sales), Rivian leads the pack with more than 22,700 R1S SUVs and R1T pickups sold in the first half of the year. GMC’s Hummer SUV and pickup truck models, with sales of approximately 4,600 units.

Aldred said GM expects to increase production of the Sierra EV, including AT4 Off-Road The entry-level Elevation model will go on sale next year, much sooner than the Hummer, which took years to arrive. GM said the Denali version is expected to go into production in the fourth quarter.

The Sierra EV is GM’s third electric pickup truck, including the Hummer and the new Chevrolet Silverado It will be available in dealers from December.

The Sierra EV’s closest competitor is arguably the Chevrolet Silverado EV. Both vehicles use GM’s “Ulium” vehicle platform and share many components, functions and performance characteristics.

The Detroit automaker differentiates its vehicles through interior and exterior design, as well as brand personality.

“Chevrolet is really focused on the fleet side. We’re really focused on the retail side, just like internal combustion trucks. The electric truck space is a premium space over the long term,” Aldred said.

Currently, the Silverado is available in a sport version that starts at about $96,500 and a work truck version for fleets and commercial customers that starts at about $67,000.

The Sierra is more refined and luxurious than its Chevy cousin: It has open-pore wood, larger screens, standard hands-free highway Super Cruise driving, GMC’s four-wheel-steering “crab mode,” and other features.

“GM has done a good job differentiating between GMC and Chevrolet,” said S&P Global’s Brinley. “The GMC Sierra and Chevrolet Silverado EV are very different in appearance, and GM has worked well with both customers for decades. They know what they need to do to attract a GMC buyer over a Chevrolet buyer, and there are subtle differences between them.”

Both vehicles have an EPA-rated range of 440 miles and offer up to 754 horsepower and 785 pound-feet of torque. Importantly for many truck customers, they can also tow up to 10,000 pounds and can charge 100 miles in about 10 minutes using a DC fast charger.

One unique feature of the Silverado and Sierra EV is that they Function of the “middle door” The vehicle’s rear seats fold up and the rear glass comes out, creating a nearly 11-foot-long truck bed and a spacious cargo area.

The Sierra EV, including the Denali version, is expected to continue to help GMC increase its pricing power and reputation as a premium truck brand, said Patrick Finnegan, senior marketing manager for GMC trucks and SUVs.

GMC’s average transaction price and premium models both increased, thanks to the newer off-road AT4 model and Denali, which celebrates its 25th anniversary as a GMC sub-brand this year.

For example, GMC’s traditional Sierra pickup truck has an average transaction price of about $60,000, including the Denali model (about $71,000) and the Denali “Ultimate” model ($78,500), according to the company.

GM has not yet announced pricing for the electric GMC Sierra Denali, AT4 and Elevation models that will follow the 2,500 “Edition 1” models. But Aldred said the Sierra could qualify for a federal tax credit of up to $7,500, meaning it would cost less than $80,000.

Denali models have evolved from simply tweaking to differentiate them from other vehicles to offering their own interiors, parts, and features. These vehicles still have essentially the same “bones,” but offer More luxurious features and materials.

GMC said Denali models account for about 34% of GMC retail sales. That’s up from 18% a decade ago and 30% in 2019. Those sales helped GMC achieve what the brand expects to be seven consecutive years of growth.

“It’s going to continue to help us maintain our position at the high end of the average transaction price space. It’s going to help us open doors to new customers,” Finnegan said. “We intend to be the retail leader in the electric vehicle truck space, and we’re going to have a more comprehensive product offering to really help us achieve that.”