General Motors plans to increase its EV and AV investments from 2020 through 2025 to $35 billion, representing a 75% increase from its initial commitment prior to the pandemic, according to a recent news release.
“We are investing aggressively in a comprehensive and highly-integrated plan to make sure that GM leads in all aspects of the transformation to a more sustainable future,” said GM Chair and CEO Mary Barra. “GM is targeting annual global EV sales of more than 1 million by 2025, and we are increasing our investment to scale faster because we see momentum building in the United States for electrification, along with customer demand for our product portfolio.”
GM shared its vision of a world with zero crashes, zero emissions, and zero congestion about four years ago. This new announcement builds on GM’s initial commitment to invest $20 billion from 2020 through 2025, including capital, engineering expenses, and other development costs, to accelerate its transition to EVs and AVs. In November 2020, the company increased its planned investment over the same period to $27 billion.
“There is a strong and growing conviction among our employees, customers, dealers, suppliers, unions, and investors, as well as policymakers, that electric vehicles and self-driving technology are the keys to a cleaner, safer world for all,” Barra said.
These investments are enabled by GM’s underlying business, including record EBIT-adjusted in the last three quarters. GM now expects to deliver better-than-expected results in the second quarter despite the industry-wide impact of the semiconductor shortage, the release also said.
The company now expects its first-half EBIT-adjusted to be between $8.5 and $9.5 billion due to continued strong demand, better-than-expected results at GM Financial, and improved near-term production from the pull forward of semiconductors from the third quarter. GM expects the second half of 2021 will continue to be complex and fluid. The company will provide additional updates on its year-to-date financial results and outlook for the second half of 2021 during its second-quarter earnings conference call on Aug. 4.
GM also confirmed that it will host an Investor Day in the Detroit area October 6-7.
GM’s additional investments and new collaborations include:
- Accelerating Ultium battery cell production in the United States: GM is accelerating plans to build two new battery cell manufacturing plants in the United States by mid-decade to complement the Ultium Cells LLC plants under construction in Tennessee and Ohio. Further details about these new U.S. plants, including the locations, will be announced at a later date.
- Commercializing U.S.-made Ultium batteries and HYDROTEC fuel cells: In addition to collaborating with Honda to build two EVs using Ultium technology – one SUV for the Honda brand and one for the Acura brand – GM announced on June 15 it has signed a memorandum of understanding to supply Ultium batteries and HYDROTEC fuel cells to Wabtec Corporation, which is developing a 100% battery-powered locomotive.
- Separately, GM will supply HYDROTEC to Navistar, Inc., which is developing hydrogen-powered heavy trucks to launch in 2024, and Liebherr-Aerospace, which is developing hydrogen-powered auxiliary power units for aircraft. Lockheed Martin and GM also are teaming up to develop the next generation of lunar vehicles to transport astronauts on the surface of the Moon.
- GM is confirming plans to launch its third-generation HYDROTEC fuel cells with greater power density and lower costs by mid-decade. GM manufactures its fuel cells in Brownstown Charter Township, Michigan, in a joint venture with Honda.
- Expanding and accelerating the rollout of EVs for retail and fleet customers: In November 2020, GM announced it would deliver 30 new EVs by 2025 globally, with two-thirds available in North America. GM will add to its North America plan new electric commercial trucks and other products that will take advantage of the creative design opportunities and flexibility enabled by the Ultium platform. In addition, GM will add additional U.S. assembly capacity for EV SUVs. Details will be announced at a later date.
- Safely deploying self-driving technology at scale: Cruise, GM’s majority-owned subsidiary, recently received permission from regulators in California to provide a driverless AV passenger service to the public. Cruise also was recently selected as the exclusive provider of AV rideshare services to the city of Dubai and is working with Honda to begin development of an AV testing program in Japan. In addition, GM Financial will provide a multi-year, $5 billion credit facility for Cruise to scale its Cruise Origin fleet. Developed through a partnership between GM, Honda, and Cruise, the Cruise Origin will be built at GM’s Factory ZERO Detroit-Hamtramck Assembly Center starting in early 2023.