GM (1) EV Sales Growth Stalls, Electrification Plans Revised

BEV product launches in North America and related investments

2024/10/08

Summary

Equinox EV
The compact SUV Equinox EV released in May 2024
(Source: GM)

  General Motors Company (GM) was one of the first to commit to an all-electric lineup, announcing in 2021 plans to phase out internal combustion engines in new light-duty vehicles by 2035. In the US, starting around 2022, the company expanded its BEV (battery electric vehicle) lineup by gradually introducing new models based on the Ultium platform, which is designed specifically for xEVs (electrified vehicles), into high volume market segments such as mid-size SUVs and full-size trucks.

  However, due in part to vehicle launch delays caused by battery supply shortages and some recalls, the expansion of EV production and sales has been slow, and the ratio of BEVs to total sales has reached a plateau.

  From the second half of 2023, there have been a number of announcements and media reports that the company is revising its launch plans and production investments in response to stagnant demand for BEVs in the U.S. market. GM CEO Barra said there will be no change to the company's xEV (electrified vehicle) transition strategy, but noted that it will be difficult to achieve the target of producing 1 million EVs per year by 2025, indicating that the company will reconsider its previously stated goals for product lineup and production expansion based on market conditions.

  As for the joint ventures to build the Ultium battery cell plants, in which investments were to be made starting in 2022 to secure the supply chain, construction of new plants has been suspended and delays in the expected start-ups have been announced.

  Conversely, the company has also shown a more pragmatic and cost-oriented direction by integrating BrightDrop, which was launched as a subsidiary dedicated to commercial vehicles for production investment, into the Chevrolet brand and discontinuing the development of Origin, a dedicated self-driving vehicle.

  While it is partially revising its joint development with Honda Motor Co., Ltd. (Honda), it has also announced technical cooperation with Hyundai Motor Company (Hyundai) and continues to explore strategies for alliances with other OEMs in light of rapidly changing industry trends.

  The North American market has become increasingly important to GM due to sluggish sales in the Chinese market, but the environment surrounding GM's xEV transition strategy, to which it has made strong commitments and investments, is becoming more challenging and complex, due to factors including a slowdown in BEV demand and intensifying cost competition, as well as a major impact on the supply chain from U.S. economic and security policies against the backdrop of U.S.-China conflicts.

  This report focuses on EV product development and related investments in North America as Part 1 of a report series that organizes GM's recent global activities and announced plans. Part 2 of this series will report on product development, sales, and global corporate performance in the U.S., China, and other major markets, as well as GM's global production forecast by GlobalData.

 

Related reports:
WCX 2024 (2) Improved vehicle sustainability and industry perspectives (Apr. 2024)
Korean Battery Supplier Operations in North America (Jan. 2024)
Electric Mobility in the USA (Jan. 2024)
GM (2): Global sales and earnings increase due to higher sales in the U.S. (Sep. 2023)
GM (1): Aiming for annual production of 1 million EVs in North America by 2025 (Sep. 2023)
Robotaxi Deployments Grow Despite Negative Setbacks (Aug. 2023)
Inflation Reduction Act: Support for EV/PHEV/FCEV Purchases (Jun. 2023)

 

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