General Motors, which has billed itself as “all in on electrification” this year, has acquired a 25% stake in Pure Watercraft, a Seattle start-up that makes electric outboard motors for boats, the companies told CNBC.
Pure Watercraft systems use lithium ion batteries to replace 40- to 50-horsepower outboard motors that burn gas or diesel. Traditional fuel-powered boats contribute to environmental problems including noise pollution, smog, and water pollution that is plainly visible floating on the water in their wake. Pure’s systems are much quieter and cleaner.
For Pure Watercraft CEO Andy Rebele, a lifelong fishing and boating enthusiast and former rowing coach, a personal drive to solve those problems lined up with a massive market opportunity.
According to the National Marine Manufacturer’s Association (NMMA) outboard engine sales in the U.S. reached a record level during 2020, increasing for the ninth consecutive year, to an estimated $3.4 billion.
“The boating market is growing like it hasn’t since post-World War II,” says Rebele. “During the pandemic, people wanted to do things with their families, with their pods. Going out on the water is one of the ideal things to do.”
That growing market is on GM’s radar as well. CEO Mary Barra hinted at GM’s interest in electric marine transportation in a blog post in October, discussing the company’s Ultium battery and Hydrotec fuel cell platforms.
According to Rebele, the deal with GM is worth $150 million combined, including payment-in-kind commitments and capital invested by the autos giant. The company is not disclosing the split between cash and payment-in-kind.
With its investment, GM will become a supplier of components to Pure Watercraft, a co-developer of new products, and will provide engineering, design and manufacturing expertise to help the start-up establish new factories, the companies told CNBC.
Its new partnership with GM should help the start-up navigate supply chain issues as Pure Watercraft grows, Rebele said.
For GM, the investment in Pure Watercraft is another in a series of moves to expand its battery and fuel cell systems outside of automotive. Earlier this year, GM announced plans to develop and commercialize electric locomotives with Wabtec. It also has shown interest in using its batteries and fuel cells for aerospace and military applications.
Pure Watercraft’s post-money valuation stands at $600 million. The 55-employee start-up had previously raised $37 million in venture funding.
— CNBC’s Mike Wayland contributed to this report.