GM Delays Electric Pickup Truck Expansion
General Motors Co. It is delaying the opening of its second factory for electric trucks in Michigan, citing the need to save money in light of a slowdown in the growth of sales of electric vehicles. The business stated in a statement on October 17th that the conversion of its Orion Assembly factory will be delayed by a year, with a new target date of late 2025. The goal of this change is to maximize capital expenditures while adjusting to the changing demand for electric cars.
The GM production is currently dealing with two challenges: a decline in interest in electric models in the United States and the threat of increased labor expenses as a result of union contract discussions that will take place over the next four years. The United Auto Workers have been on strike for more than a month despite a 20% salary raise offer.
Although electric vehicle sales are still on the rise, their growth rate has decelerated. In the third quarter, sales increased by only 6% sequentially, compared to a 14% surge in the preceding three-month period, according to Kelley Blue Book truck. While sales have risen nearly 50% during the first nine months of the year compared to the previous year, the growth trajectory is declining, and more companies are entering the market with competitive models. At the close of September, automakers had 88 days’ worth of electric vehicle inventory, in contrast to 56 days for conventional models, according to Cox Automotive research.
General Motors Corp. will persist in the truck production of electric vehicles such as the Chevrolet Silverado, Hummer EV, SUV, and the Cruise Origin robotaxi. The company also intends to introduce a second shift at its Factory Zero plant, which straddles Detroit and Hamtramck. In 2024, they will commence production of the GMC Sierra EV, followed by the electric Cadillac EscaladeIQ.
GM is also expanding its GM production of the Cadillac Lyriq crossover SUV in Tennessee and the Chevy Blazer EV, produced in Mexico. In a similar vein, rival Ford Motor Co. has scaled back production for its F-150 Lightning pickup and, like Tesla Inc., has reduced prices in a bid to sustain sales with more competitive pricing, albeit with slimmer margins.
Sam Fiorani, Vice President of Global Forecasting for AutoForecast Solutions, noted, “The market is becoming saturated, and we are witnessing a shift from early adopters to mainstream car buyers, a trend that all car companies, not just GM, are now realizing.”GM remains committed to its objective of achieving the capacity to manufacture one million electric vehicles in North America by the end of 2025, as reiterated by company spokesman Kevin Kelly. For the latest GM news and General Motors news, stay tuned as the company adapts to the evolving landscape of electric vehicle demand and truck production.
