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GM, Kodak, and The Battle of Norway

Yesterday, GM launched a seemingly harmless ad starring Will Farrel attempting to start a war with Norway in a battle for EV supremacy.

The ad was labeled "too little, too late" by some, and I'm unsure how major auto manufacturers joining the race to electrify transportation can be seen as bad.

I understand the "they should have done this sooner" argument. But, I spent the better part of the last decade attempting to sell sustainable energy solutions directly to consumers and small businesses. Let me be the first to say, demand for sustainable technologies is a recent development.

But this story isn't about the lack of demand for electric vehicles.

Businesses like GM act rationally, often to their detriment. In 7 Powers, Hamilton Helmer makes a brilliant case that even Kodak acted rationally when opting not to pursue the digital camera.

Why did they pass on the digital camera? It wasn't because they didn't see it coming. Kodak was a film business, not a camera one.

The digital substitute for film was digital storage, and Kodak had no competitive advantage or competence in semiconductors. They invested in a pivot and new technologies, and they ultimately failed.

This is where legacy auto manufactures are today. Electric vehicles and the business models they enable require completely different core competencies than their ICE counterparts.

Maintenance and new features can be done via software updates. Battery storage and technology are differentiators.

Traditional OEMs built their power through distribution networks and service centers that will soon be obsolete. They acted rationaly by protecting these competencies and it will be determined if they waited too long to change course.

The public markets see the impending battle between tradtional OEMs and upstart EV startups on the horizon. They're betting big on the latter. Electric vehicle SPACs are up 119% and that doesn't include Tesla's incredible performance in the last year.

A fictional war with Norway is comical, but I suspect for several of the legacy autos the next decade will leave them with little to smile about. In the meantime, let's celebrate their efforts and hope that we'll benefit from them in the long run.