General Motors Corp. GM has followed in the footsteps of its crosstown rival Ford Motor Co. F and delayed its electric-vehicle production goals, comments from CEO Mary Barra in an interview revealed on Monday.
What Happened: “We will not get to a million just because the market is not developing,” Barra said at a CNBC event. The legacy automaker has set a production goal of one million EVs by 2025, and in December CFO Paul Jacobson reiterated the goal at a Barclays conference.
Barra said GM is moving to an all-electric future and she considers it important that the vehicle is really a software platform. She noted that the EV industry is seeing a bit of a slowdown. That said, the top brass reiterated the company’s commitment to EVs. “We'll get there and so we're going to be guided by the customer,” she said.
The GM CEO also made a sales pitch to users regarding EVs. “But what I'd like to tell people is get in an electric vehicle and drive it. It's a lot of fun, it's instant torque, it opens up new design line,” she said. As charging gets more robust and EVs become more affordable, the growth that will be seen in the next 10-12 years is going to be transformative in the way people move, she said.
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Why It’s Important: GM is not alone in facing a setback to its EV plans. Ford for one said in early April that it had delayed the planned launches of three-row EVs in Canada and its next-generation electric pickup truck built in Tennessee, citing an industry-wide demand slowdown globally. Instead, it embraced hybrids. The company planned to boost hybrid EVs and set sights on offering hybrid powertrains across its line-up of ICE vehicles by 2030.
Earlier in July 2023, the company said it expects to hit the EV annual production goal of 600,000 units at some point in 2024 as opposed to earlier plans to achieve the milestone by the end of 2023. Ford CEO Jim Farley said that the 2023-second quarter earnings call price has served as a deterrent for EV adoption. Earlier this year, Farley said on another earnings call that the company had assembled a small team to develop an affordable EV.
The travails faced by the EV industry have come to haunt even established pureplay and established EV companies such as Tesla, Inc. TSLA, which has now reported its second straight quarterly sales drop.
In 2023, Tesla produced and manufactured 1.85 million and 1.81 million units, respectively. In comparison, Ford sold 72,608 EVs, including the F-150 Lightning pickup truck, E-transit and Mustang Mach-E vehicles, and GM 75,585 units.
GM settled Monday’s session up 0.59% at $49.30, according to Benzinga Pro data.
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