General Motors Company (GM - Free Report) is set to showcase the electric version of Chevrolet Spark in the upcoming Los Angeles Auto Show. The mini car will be launched in California, Oregon, Canada and South Korea in the summer of 2013.
The launch is expected to enhance the company’s business and provide a low cost alternative to the customers. The electric version of Spark is best suited for city drivers as it occupies less parking area. However, the automakers are faced with a sluggish demand for electric vehicles due to the fall in gas prices. Moreover, the consumers are concerned about the lack of a charging infrastructure and high price premium of the electric cars.
The new Spark features an electric motor and a 20 kWh lithium ion battery, making it faster than the gasoline version of Spark. In addition, it is the first vehicle in North America with SAE Combo DC Fast Charge capability, which charges the battery 80% to its capacity within 20 minutes. Meanwhile, it takes 7 hours to be fully charged using a 240-volt outlet.
The latest offering is touted to be one of the top performing electric vehicles. Currently, Ford Motor Co.’s (F - Free Report) Focus provides a mileage of 76 miles on a single charge and Nissan Motor Co.’s (NSANY - Free Report) LEAF travels 228 kilometers (or 140 miles) on a single charge. The new Spark is also cheaper than the other electric vehicles in the market. It is expected that the vehicle will be priced at around $25,000 in the U.S., which is lower than the electric vehicle LEAF.
Recently, Nissan announced the launch of the upgraded version of its electric vehicle LEAF in Japan. The new LEAF model will likely cater to the rising demand for eco-friendly electric vehicles, which could travel more miles without charging. The vehicle offers excellent performance and better driving feel. Moreover, the electric motor in the vehicle uses 40% less rare earth element, dysprosium, and the heat-resistance levels are same compared to the conventional electric motors.
Detroit, Michigan-based General Motors is the largest automobile manufacturer in the world and one of the ‘Big Three’ U.S. automakers. However, the company's significant exposure to troubled Europe has adversely affected its operations in the continent.
Currently, General Motors retains a Zacks #3 Rank, which translates into a short-term Hold rating. We have a long-term Neutral recommendation on the stock.