General Motors Corporation GM has committed additional investment to further its electric vehicle push as it plays catch-up with the incumbents.
What Happened: GM said Tuesday it is investing more than $7 billion in four Michigan manufacturing sites. The company termed this as the single largest investment in its history.
The investments will go toward:
- $2.6-billion investment for the construction of a new Ultium Cells battery cell plant in Lansing, along with its LG Energy Solutions joint venture partner.
- $4-billion investment for the conversion of the company's assembly plant in Orion Township for production of the Chevrolet Silverado EV and GMC Sierra EV.
- A more than $510-million investment for upgrading production capabilities of near-term products in its two Lansing-area vehicle assembly plants.
These investments, GM said, are the latest step toward accelerating GM's drive to become the EV market leader in North America by 2025. The company expects the Orion and Ultium Cells Lansing investments to help increase its full-size EV truck production capacity to 600,000 trucks when fully ramped.
"Today we are taking the next step in our continuous work to establish GM's EV leadership by making investments in our vertically integrated battery production in the U.S., and our North American EV production capacity," GM Chair and CEO Mary Barra said.
By the end of 2025, the company hopes to have more than 1 million units of electric vehicle capacity in North America.
The company said the investment announced is intended to take advantage of the strong consumer response and reservations for its recent EV launches and debuts, including GMC HUMMER EV, Cadillac LYRIQ, Chevrolet Equinox EV and Chevrolet Silverado EV.
"Our plan creates the broadest EV portfolio of any automaker and further solidifies our path toward U.S. EV leadership by mid-decade," Barra said.
Related Link: EV Sales Are On The Rise, But Tesla's Global Market Share Is Shrinking: Analyst
The conversion of the Orion plant is expected to create over 2,350 new jobs and retain 1,000 current jobs when the plant is fully operational. EV production at this plant is expected to begin in 2024.
The new battery plant at the Lansing site will create 1,700 new jobs, the company said. Site preparations will begin in the summer and battery production will begin in late 2024, it added. Ultimum Cells Lansing is expected to supply battery cells to the Ohio assembly and other GM assembly plants.
"Vertically integrating battery assembly and converting existing assembly plants are at the core of GM's strategy for scaling EV production in North America," the company said in a statement.
The company expects to convert 50% of its North American assembly capacity to EV production by 2030.
Why It's Important: Tesla, Inc. TSLA is the EV market leader in the U.S., taking nearly two-third of the overall market. The company plans to open its second EV manufacturing plant in Texas shortly, which is expected to augment its capacity.
Legacy automaker Ford Motor Co. F has also plunged headlong into EV transition. In September, the company announced a $11.4 billion investment to build EVs at scale for U.S. customers.
Ford said earlier this month it will have the capacity to build 600,000 EVs annually, including 150,000 F-150 Lightning pickup truck, within 24 months.
GM shares were trading down 0.89% at $52.17 Tuesday afternoon.
Related Link: EV Week In Review: Tesla Slips Below $1K Ahead Of Earnings, Nio Begins Locking ET7 Orders, BYD Raises Prices And More
GM CEO Mary Barra. Benzinga file photo by Dustin Blitchok.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
