Great News for General Motors Investors
Trucks carry higher margins than sedans.
Trucks also require heavier and more expensive batteries.
New chemistry could unlock superior performance.
10 stocks we like better than General Motors ›
Full-size trucks and Detroit automakers are a match made in heaven, and the former have kept a grip on the U.S. market for decades. It's a good thing too, because the margins and profits delivered with full-size trucks are gigantic compared to mainstream sedans.
Sales of full-size trucks kept the lights on during dark days, but the question has been, "How feasible are trucks as electric vehicles?" Let's dig into the challenges facing trucks, and one breakthrough automaker General Motors (NYSE: GM) had recently that could substantially improve costs.
Here's the secret about Detroit's bread-and-butter full-size trucks: They don't cost much more to manufacture than sedans, and the price tag to consumers can be around 4x higher. But this gravy train could be coming to an end, because things are different when you enter the electric truck.
For the full-size electric truck to be capable of hauling loads, it would need to be equipped with a powerful battery -- those get heavy, and they get expensive. Gone are the days when you could manufacture a full-size electric truck for marginally more than a sedan, primarily thanks to the massive battery costs.
Don't take it from just me. Lucid's former CEO, Peter Rawlinson, said it's "very tough to make an electric pickup work today." That's apparently one reason why you'll only find luxury sedans and SUVs in Lucid's lineup and product pipeline.
Here's the good news: Battery costs are going down, and General Motors has made a recent splash in battery chemistry.
General Motors recently announced it developed a new battery cell with joint venture partner LG Energy Solution -- GM started research on the new battery cells in 2015. The upside is the new battery, called lithium manganese-rich (LMR), will bring down costs on its EVs without compromising on range.
"... It's a game-changing battery for electric trucks," Kurt Kelty, GM's vice president of battery, propulsion and sustainability, told reporters according to Automotive News. "We believe we can deliver more than 400 miles of range in a single charge in a truck, while significantly reducing our battery costs."
A brief recap: GM accelerated its LMR cell development in 2020, invested $85 million in manganese supplier Element 25 in 2023, and as of 2025 have tested the cells in R&D labs to the equivalent of 1.5 million miles of EV driving.
General Motors' new battery chemistry is really just an example of how things will likely be going forward. Just as one engine size doesn't fit all gasoline vehicles, one battery size or chemistry doesn't fit all EVs. To optimize performance and costs, automakers are going to have to experiment with different chemistry and sizes, among other variables, and it's a great sign GM's joint venture is making real progress -- this battery is expected to be on the market in 2028.
Perhaps more importantly, this is just a little good news that eventually could drive the profitability and margins for EV trucks just as we're used to for gasoline counterparts -- and that's huge for investors. It's also imperative to bring prices down to open the door to more consumers. Detroit automakers need full-size trucks to stay as bread-and-butter products hauling massive margins.
Ultimately, GM's upcoming battery, and JV with LG Energy Solution, is just one more smart move GM has made.
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Daniel Miller has positions in General Motors. The Motley Fool recommends General Motors. The Motley Fool has a disclosure policy.
Great News for General Motors Investors was originally published by The Motley Fool
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