GM To Pump $1 Billion into New E-Commerce Unit: Develops Web Car

General Motors Corp. announced today that it has formed an independent unit called "e-GM," which will be charged with expanding the company's presence in cyberspace -- plus developing new products.

One of its projects will be the introduction of "Web Car," a vehicle loaded with voice-activated Internet access, scheduled to be released by the end of the year. Company officials said that the prototype of the car would most probably be a Cadillac, which will be testmarketed beginning this fall. Slow to make the e-commerce plunge, the Detroit, Michigan auto and truck maker plans to make up for lost time.

"With this move, we are applying the power of our technology innovations and the strength of our human and financial resources to the Internet to enhance the way we develop customer relationships," G. Richard Wagoner Jr., GM's chief operating officer.

Internet Access, Satellite Broadcasts and Stolen Car Recovery

By becoming wired, GM hopes to generate $4 billion (US$) to $6 billion annually on Internet access and CD-quality satellite radio broadcasts. Internet access for the automaker's "Web Car" will be offered from its OnStar service center. In addition to connecting a car to the Web, OnStar can provide motorists with directions, track a car that's stolen, unlock a car when the keys are left inside and even call an ambulance if necessary -- after an air bag deploys.

The subscription price for these e-services ranges from $17 to $33 a month. The company plans to roll out the product over the next 18 months, increasing its subscriber base from 75,000 to more than 1 million. GM is also negotiating to sell the system to other companies.

Others To Follow?

GM plans to initially pump $1 billion into OnStar and other e-commerce ventures, according to company officials. But industry experts said that the auto giant could soon have company. It's rumored that both Ford Motor Co. and DaimlerChrysler AG are developing similar systems -- though no official announcement has been made.

Part of the newly formed e-GM's mission will also be to coordinate and take advantage of its 100 consumer Web sites scattered throughout the world. In June, GM sites racked up a total of 3.8 million unique visits, while GM Buypower, its online shopping site, tallied more than 650,000 visitors looking to buy a new car.