General Motors (GM) announced that it is once again slowing its electric vehicle (EV) plans, delaying the opening of a second U.S. electric truck plant and Buick’s first EV release. This six-month postponement impacts the Michigan electric truck plant retooling, now set for mid-2026, and disrupts GM’s target of having a North American production capacity of 1 million EVs by 2025.
Slowdowns Amid Growth
Despite CEO Mary Barra’s commitment to responsible and profitable growth, GM is facing hurdles. Barra raised concerns about hitting the North American EV production capacity target a week before the earnings call. The Buick brand, which aims to be fully electric by 2030, will also see delays, with no updated timeline for its first EV initially expected in 2024. GM’s overall goal is to offer exclusively consumer EVs by 2035.
Questions About Future Battery Plants
The delay in EV production has cast doubt on GM’s future battery cell plants. GM previously announced four multibillion-dollar plants in the U.S. by 2026, but now, only two joint ventures with LG Energy Solution in Ohio and Tennessee are confirmed. CEO Mary Barra emphasized a “meaningful cadence” for cell production growth, while CFO Paul Jacobson refrained from commenting on potential delays or cancellations of future battery plants. “We’re going to continue to be guided by the customer,” Jacobson said, highlighting the focus on scaling existing plants.
Growing Sales and Profit Expectations
Despite the production delays, GM’s U.S. EV deliveries saw a 40% increase in the second quarter compared to the previous year, totaling 21,930 units. However, EVs still account for only 3.2% of GM’s second-quarter U.S. sales. Jacobson noted that the company is on track to assemble 200,000 and 250,000 all-electric vehicles in North America this year, having already wholesaled about 75,000 units in the first half.
Jacobson reassured investors that GM’s EVs are expected to be profitable on a production margin basis once the output reaches 200,000 units by the fourth quarter. “We’re still holding to that,” he said, though he acknowledged that additional EV sales would initially lower the company’s earnings due to lower profits than traditional gas models.
The Road Ahead
GM’s journey towards an all-electric future is marked by both progress and setbacks. While sales are growing, the delays in production and new model releases pose challenges to achieving their ambitious goals. As GM navigates these hurdles, the focus remains on responsible growth and customer guidance, ensuring that the transition to electric mobility is both strategic and sustainable.
