Production of Chevrolet Bolts, domestic electric vehicle batteries, and self-driving Cruise vehicles will all increase as General Motors soldiers ahead with its future product plans, says chairman and CEO Mary Barra in a call to highlight the company’s strong third-quarter earnings. Economic and supply shortage headwinds aside, the automaker continues to update and sell its profitable combustion-powered trucks at a strong pace while ramping up the EV side of the portfolio. Here are some highlights from the call with investors.
Chevrolet Bolt EV and Bolt EUV
To meet record demand for the Chevrolet Bolt EV and the Bolt EUV, the automaker will increase production from 44,000 this year to 70,000 next year, Barra says. Sales of the Bolt twins outsold the Ford Mustang Mach-E by more than 2:1 in September, Barra notes in a letter to shareholders. The Bolt is the most affordable EV in GM’s portfolio and the hope is these buyers move up to the upcoming Chevrolet Equinox EV for their next purchase. GM recently unveiled a number of new EVs including the $35,000 2024 Equinox EV, the 2024 GMC Sierra EV pickup, and the $300,000 Cadillac Celestiq, all on the same Ultium battery-electric platform.
Local Batteries for GM EVs
The other big news is that the GMC Hummer EV and SUV, as well as the Cadillac Lyriq will soon switch from using imported battery cells to ones made domestically at the Ultium Cells joint venture in Ohio. Original plans were to be fully ramped up and making enough cells in the U.S. for 400,000 EVs a year by the end of 2023. Barra said the timeline has been pushed back and it will now take until mid-2024. The complexity of the Ohio plant and the training of more than 1,000 employees is taking longer than anticipated. GM will add a second battery cell plant in 2023, a third in 2024, and a fourth is also planned.
Work is also underway to increase vehicle production at the Factory Zero plant that makes electric trucks in Michigan, the CAMI plant that will make commercial vehicles in Ontario, the Ramos Arizpe plant in Mexico, and Orion Assembly which will also make large trucks in 2024.
“The Chevrolet Equinox EV and the GMC Sierra EV that we revealed in recent weeks, along with the Chevrolet Silverado EV and Blazer EV, are cornerstones of our strategy to rapidly grow EV volumes by winning in high-volume segments. They have all been incredibly well received by customers and industry experts who see them driving rapid EV adoption and conquest sales for GM, including in coastal markets,” Barra says.
The CEO says she also expects many of GM’s most affordable EVs will be eligible for the $3,750 tax rebate under the new Inflation Reduction Act and in a few years, when battery cells and minerals are sourced to meet the criteria, that many vehicles will then qualify for the bigger $7,500 tax credit.
Cruise RoboTaxi Service Expanding
Cruise, which is GM’s autonomous vehicle subsidiary, has been offering driverless rides in San Francisco with 400,000 driverless miles under its belt, and is expanding its hours and service area, said Cruise CEO Kyle Vogt. Cruise is expanding to Austin and Phoenix which will complete their first driverless public rides and commercial deliveries by the end of the year. Supervised testing has begun in Austin with more than a dozen vehicles where AI is factoring in unique elements like donkeys, pedicabs, and police on horses, Vogt said.
The early commercialization is now done, Vogt says. Next year marks the start of the rapid scaling phase to get to the backlog of people waiting to use the service, ramp up operations and start to generate meaningful revenue. The Cruise Origin driverless pod has also begun operating in San Francisco for data collection. Production of the Origin will begin next year at Factory Zero.
First Electric Buick to Debut
The first Ultium-based Buick for the China market will debut late this year, Barra said, on the heels of the Cadillac Lyriq launch in September. After Covid lockdowns, operations in China have returned to profitability.
BrightDrop Plant Ready to Roll
GM will also start building BrightDrop electric commercial vans later this year at the retooled CAMI plant in Ontario. Production will ramp up in 2023 to fill orders from customers such as Walmart, FedEx, and Kroger.
GM Reports Strong Third-Quarter Earnings
Getting more trucks out the door, as well as prices that continue to rise were reflected in a strong quarter for GM. Net income was up 37 percent to $3.3 billion. Global revenue rose 56 percent to $41.9 billion. Adjusted earnings (before interest and taxes) were up 47 percent to $4.3 billion, most of it coming from North America.
In the summer, GM said a shortage of microchips and other parts forced the automaker to hold back about 95,000 unfinished vehicles. GM has since completed and shipped about three quarters of them. Parts availability continues to slowly trend in the right direction, says chief financial officer Paul Jacobson.
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