GM Considering More Large SUVs To Fund EV Tech

General Motors recently updated its family of SUVs with the launch of the latest-generation Chevrolet Tahoe and Suburban models and is already eyeing more SUVs to keep up with shifting consumer sentiment.

Both the new Tahoe and Suburban are larger than the models they replace. In fact, the Tahoe is a massive 6.7-inches longer than its predecessor and offers third-row passengers 10-inches of additional legroom.

Reuters spoke to General Motors president Mark Reuss at the vehicle launch who revealed that much of the profits generated by the arrival of these two new SUVs will be funneled towards the automaker’s future electric vehicles, including its upcoming electric pickup truck.

Also Read: GM Dropping Another $20 Million In Texas Plant For New Full Size SUVs

Both the new Tahoe and Suburban are built at a thriving complex in Arlington, Texas that recently received $1.4 billion in new investments. According to Reuss, the investments will give the company the flexibility to manufacture additional models if needed although he failed to describe what form these new models could take.

GM’s Arlington facility runs 24 hours a day to meet demand for SUVs. What’s more, profit margins on large SUVs are thought to be as high as 30 per cent and according to Barclays, approximately 72 per cent of GM’s North American profit in 2018 came from large SUVs.

Demand from consumers for large SUVs isn’t the only reason they are becoming more prevalent. One other reason is that under U.S. fuel economy rules implemented under the Obama administration, vehicles with a larger footprint have easier mileage and CO2 emissions targets to meet.