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Chevy expands two-track strategy with Equinox ICE, EV siblings
Posted by Talbot Payne on September 2, 2024
Minneapolis — Electric vehicles have shaken up the auto industry with upstart Tesla Inc. boasting sky-high capital valuations, governments mandating EV sales and drivers plugging into new electric infrastructure across the country. Still, the EV future remains uncertain.
Most mainstream auto brands have created new, separate model lines for their EVs — targeting Tesla with premium-priced chariots aimed at premium customers. Think Volkswagen’s ID line, Kia EV, Hyundai Ioniq, Toyota bZ4X, Nissan Leaf/Ariya. Luxury automakers have also introduced separate EV lines like the BMW i-series, Audi e-tron and Mercedes EQS.
Not Chevrolet.
General Motors Co.’s meat-and-potatoes brand has introduced Equinox, Blazer and Silverado EVs that parallel familiar internal combustion-engine badges with an eye towards eventually converting all production to EV. Chevy, Volkswagen and Honda stand out as mainstream staking their futures on electric vehicles, hoping to follow Tesla into what GM calls an autonomous, EV future of “zero emissions, zero crashes, zero congestion.”
Equinox is particularly notable. Customers have a parallel choice of ICE and EV versions of the small SUV in the largest segment of the auto marketplace.
“They are different vehicles,” said Chevrolet Global Vice President Scott Bell in Minneapolis for the Equinox ICE’s media test. “Equinox is a very valuable name. We’ve been selling Equinox for 20 years and plan to sell them for many more. So as we transition to an all-EV portfolio eventually, we didn’t want to lose that brand. The same for Blazer and Silverado, for that matter.”
As GM goes all-electric over the next 10 years, Bell does not expect it to happen overnight.
“The intent when we set out with this strategy was to make the EV business as incremental as possible,” Bell said. “Not to switch our existing customers — although (the choice) is there if they want to switch. The intent was to bring new customers in, leverage that EV tech, then keep them for life. We’re conquesting Tesla buyers — that’s a big piece of the EV business.”
Other mainstream automakers have also remade their business plans to go all-electric. Honda, for example, is calling its planned end of ICE production by 2040 its “Second Founding.” And other mainstream companies have introduced EVs under traditional badges — the Ford F-150 Lightning, the Hyundai Kona EV — but Chevy is the most aggressive in targeting three established model badges.
“It’s a good idea in the long term, assuming that Chevy will sell nothing but EVs,” said Karl Brauer, a veteran auto analyst for iSeeCars.com. “But in the meantime, it might be confusing to customers who don’t know that, say, Equinox has two very different drivetrains.”
GM’s strategy dovetails with government regulatory trends pushing automakers toward EVs. The driving force in the United States is California, the nation’s largest auto market (and, were it a country, the fifth-largest economy on the planet).
By 2026, the Golden State will require, under its Advanced Clean Cars II (ACCII) rules, that 35% of automaker sales be zero-emissions vehicles. Failure to meet that goal will set automakers back $20,000 per vehicle that is shy of that threshold. The sales requirement jumps to 43% in 2027, 51% in 2028, 59% in 2029, and 68% in 2030 on the way to outlawing sales of new ICE vehicles in 2035. Fourteen other states have adopted the standards set by the California Air Resources Board regulatory body.
In the second quarter of 2024, 22% of California sales were EVs with Tesla accounting for over half of that total. Remove Tesla, and just 10.6% of sales were battery-electric, according to the California New Car Dealers Association. The only GM model to crack the Top 10 in EV sales was the discontinued Chevy Bolt/Bolt EUV with 3,960 units sold.
Federal regulations calling for EV sales to be 56% of the market by 2032, based on EPA greenhouse-gas-based auto emissions limits of 86 grams of carbon dioxide/mile, are less ambitious.
“GM is proud to share California’s vision of an all-electric future with zero emissions,” said Bill Grotz, GM senior manager for global public policy/regulatory communications. “We believe everyone should have access to affordable, long-range EV options, and we are committed to working in collaboration with California to accelerate the rollout of zero-emission vehicles, consistent with the state’s goals.”
Automakers have consistently fallen shy of California’s CO2 emissions goals. Rather than pay fines to the government, they have purchased zero-emission credits from EV makers like Tesla. Since 2009, Tesla has raked in $9 billion in income from regulatory credits.
California’s 2026 ACCII marks a major leap in regulatory penalties. Given the reality of the consumer market, where EV adoption has stalled, California-based analyst Brauer says the regulations are unsustainable.
“California has proposed crazy standards in the past and has moved them back,” he said, citing the state’s rollback of a 1990 mandate that required 10% EV sales by 2003. “Cooler heads will prevail because there are too many downsides.”
While regulators and lobbyists hash out different visions, Chevy consumers have a choice of two Equinoxes in showrooms.
The Equinox EV, introduced earlier this year, and the redesigned Equinox ICE wear different wardrobes to appeal to different customers.
The EV is athletic, sci-fi — its sleek design and thin, LED lights appealing to a new, Tesla-influenced generation. The Equinox ICE goes after traditional Chevy buyers by mirroring the brand’s Silverado and Colorado pickups’ bold, stocky design.
Inside, the roomy Equinox siblings are similar, with dual digital displays mounted high on the dashboard, Google Built-in operating systems and steering wheel-mounted shifters to open up console space.
“(We) offer two very different vehicles — EV and ICE,” Bell said. “We’ve got good value in both, good tech in both, you can do different styling (with the EV Ultium platform). EVs get a little lower to the ground and are sleek and sporty. With the new ICE variant … it’s more masculine, more like a truck than ever.”
The different wardrobes are bringing in a broader demographic than Equinox has in the past. With the federal $7,500 EV tax credit, a comparable Equinox EV 3LT starts at $37,395 (instead of $45,295 without the credit) compared to a gas-powered Equinox RS at $36,395 (ICE cars do not get a tax credit).
“We’re seeing a different customer” for the Equinox EV, Bell said. “These are people who weren’t Chevy customers … coming in and talking about Equinox because it’s an EV and it offers them range, style, tech.”
He says it’s a marked contrast to last decade when Chevy offered, for example, a more fuel-efficient diesel powertrain in the compact Cruze sedan as an option to the standard gas mill.
“Those vehicles in the past were the same vehicles with different powertrains,” said Bell. “We chose to build a purpose-built Ultium EV platform. (These are) unique products and we feel good about what they are bringing to the marketplace.”
Henry Payne is auto critic for The Detroit News. Find him at hpayne@detroitnews.com or @HenryEPayne.