GM Is Bringing the Electric Fight to Tesla’s Home Turf

Tesla Model S

It was only a matter of time before Tesla Motors’s (NASDAQ:TSLA) presence in the auto industry drew the attention of incumbent leaders. And while many expected the electric vehicle maker to go the way of Tucker or DeLorean, Tesla has surprised its critics and held fast — leaving the rest of the industry scrambling to figure out how to address the disruptive contender.

If any firm is geared for taking on the EV market champion, it’s one of the largest automakers in the world: General Motors (NYSE:GM). Its CEO, Dan Akerson, said that the Cadillac brand will be meeting Tesla’s market threat — on its own turf, too.

Akerson told The Detroit News that GM plans “to compete head-to-head” with Tesla, and that GM has gone as far as to set up a small team to study the EV maker. He added that Tesla has established itself as a high-end electric brand, but GM will “sell more [Chevrolet] Volts and lose less money on the Volts than they’ll lose on the Model S.”

If you’re thinking that those two vehicles are hardly comparable, you’d be right. With its recent $5,000 price cut, the Volt will run about $34,995 including shipping but before federal tax credits, while Tesla’s Model S carries a base price of $71,070 including shipping and before incentives. Further, the Volt is an extended range plug-in hybrid, not a true EV, as the Model S is.