General Motors takes control over BrightDrop
GM states that the aim of the power transfer is to increase the division’s efficiency and reduce costs. Fleet customers should also benefit from the restructuring. “We believe that this move will benefit our fleet customers by providing them with an efficient single point of contact through GM Envolve,” BrightDrop wrote.
The BrightDrop brand and the concept of a van-only brand with access to the Group’s EV technology was developed in the GM Innovation Lab. Since the brand was launched in 2021, the team has been able to operate relatively independently of GM management. The press release describes this as the right way of working at the right time: “That structure allowed BrightDrop to operate with the agility and innovation of a tech startup and benefit from GM’s deep manufacturing expertise.” The move back to GM is also described as a logical development. “As BrightDrop has matured, we are now bringing that ethos back to GM so our work is more efficient and so BrightDrop’s startup spirit can help fuel further success with GM’s commercial customers,” the company letter states.
It is not known whether this is the actual reason or whether BrightDrop has missed its financial targets – GM has not yet published any separate figures for BrightDrop. In November 2022, BrightDrop was still said to be on track to achieve sales of more than one billion US dollars in 2023. However, due to a lack of battery modules, BrightDrop production has been at a standstill since October and will probably not restart until 2024. However, this is more likely to be due to a bottleneck on the part of GM than a failure on the part of BrightDrop.
The only thing that is clear is that BrightDrop CEO Travis Katz, who joined GM from Redpoint Ventures, is leaving the company – Katz could not be reached for comment by Reuters. Only a few BrightDrop employees are likely to lose their jobs in the transition to GM, with the majority transferring to GM, according to TechCrunch.
GM itself will now take over the reorganization and overhaul of the production facilities (a separate battery module assembly plant is currently being built in Ingersoll). However, the fundamental goals of the BrightDrop brand are to be maintained.
US industry experts were not surprised by the move to incorporate BrightDrop into GM. “Brightdrop was founded at a time when the public markets had an insatiable appetite for new electric vehicle manufacturers,” Trucks Venture Capital managing partner Reilly Brennan told Reuters. “Now that the market no longer has such demand, it makes sense for Brightdrop to be integrated into the core of GM.”