General Motors Plans To Invest $7 Billion In US EV Plants And Surpass Tesla's Sales By 2025

The chief executive officer (CEO) of General Motors (GM) said last year that the company can catch up with Elon Musk’s Tesla in electric vehicle (EV) sales by 2025 in the United States, and now it looks like the automobile giant is quite serious about its target.

GM on 25 January has announced that it will invest more than $7 billion in four Michigan manufacturing sites. This investment will create 4,000 new jobs, as well as increase battery cell and electric truck manufacturing capacity, said the company.

The increased investment is part of a goal to raise GM's North American production capacity to 1 million electrified vehicles by 2025.

CEO Mary Barra said: “We are building on the positive consumer response and reservations for our 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 US EV leadership by mid-decade.”

The investment includes the construction of a new Ultium Cells battery cell plant in Michigan’s Lansing, as well as the conversion of GM's assembly plant in Orion Township, to produce the Chevrolet Silverado EV and the electric GMC Sierra. According to the automaker, this will be GM's second assembly plant to build full-size electric pickups.

However, Tesla delivered over 930,000 EVs worldwide in 2021, but it does not reveal sales figures specifically for the United States, while GM's Chevrolet brand sold fewer than 25,000 EVs in the country, trailing Tesla and Ford, which sold 27,140 Mustang Mach-E EVs.

It looks like that GM has to do a lot of work to beat Musk’s company as Tesla is projected to expand its US production capacity from over 580,000 to around 1 million cars later this year, after its second domestic plant in Texas is completely operational.

GM said that when both Factory ZERO and Orion facilities are fully scaled, the investment will support an increase in total full-size electric vehicle production capacity to 600,000 trucks.

It also stated that the automaker is investing $4 billion to upgrade the plant to create electric trucks using the GM-developed Ultium Platform, which allows the business to build vehicles for every customer and market. Additionally, Ultium Cells, a joint venture between GM and LG Energy Solution, is investing $2.6 billion to establish Ultium Cells' third battery cell production plant in the United States.

“Site preparations will begin this summer and battery cell production is scheduled to begin in late 2024. Ultium Cells Lansing will supply battery cells to Orion Assembly and other GM assembly plants,” it added.

Furthermore, GM is investing more than $510 million in its two Lansing-area vehicle assembly plants to expand their production capacity for near-term products, in addition to the EV-related investments in Michigan.

GM president Mark Reuss said during a media briefing: “Michigan will be the recognized hub and leader of innovation in the US for EV R&D and manufacturing.”

However, by 2030, GM expects to transition half of its North American assembly capacity to EV production, five years ahead of a target of offering only light-duty electric vehicles by 2035.

As reported earlier this year, the US witness record sales of hybrid electric cars — which combine a conventional combustion engine with an electric propulsion system — in 2021.

According to data from analytics firm Wards Intelligence, hybrid car sales in the US increased by 76 per cent to 801,550 vehicles last year, accounting for 5 per cent of all light-vehicle sales in the country. At the same time, EV sales increased by 83 per cent to 434,879 units, but only accounted for 3 per cent of the market.