Reuters is reporting this week that General Motors, the stodgy custodian of “not invented here” thinking that has typified the world of US auto manufacturing for generations, has finally awoken to the EV revolution. The news service says GM will boost global spending on electric and autonomous vehicles to $35 billion through 2025, a 30% jump over its most recent forecast.
It was only last November that The General said it would invest $20 billion in electric vehicle manufacturing. Here it is just a little over 6 months later and that number has nearly doubled. The company says it will build only battery electric cars by 2035, but anyone who is paying attention to how rapidly the changeover to EVs is happening would probably predict the shift to electric cars at GM will take place at least 5 years sooner.
As part of its new spending plans, the largest automaker in the US says it will build two more US battery plants at a cost of more than $2 billion each. That’s in addition to the two already in the works. It will also accelerate the timing of some of its EV investments, sources tell Reuters. GM says it plans to sell more than one million electric vehicles a year between the US and China by 2025.
Dancing With The Devil In The Pale Moonlight
You may recall that a year ago, GM was shamelessly sucking up to the former president by supporting a suit by the government that sought to bar California from setting its own exhaust emissions rules. Now the company says it supports the 2019 deal struck by Ford, Volkswagen, Volvo, and other automakers with CARB to reduce tailpipe emissions by less than what the state of California wanted but more than the prior administration was prepared to accept. What a difference an election makes!
GM CEO Mary Barra is scheduled to meet next Wednesday with House Speaker Nancy Pelosi and other key Democrats to discuss EVs and vehicle emissions, sources told Reuters. She will also meet Representative Richard Neal, head of the House Ways and Means Committee, Frank Pallone, who chairs the House Energy and Commerce Committee, and two key Michigan Democrats — Dan Kildee and Debbie Dingell.
The Biden administration has proposed spending $174 billion to promote electric vehicles. Part of that money would be used to fund an expansion in federal incentives for EV purchasers, something that GM customers are currently not eligible for. There are proposals in Congress to create a 30% investment tax credit for manufacturers who retool or build new factories in the US to produce advanced energy technologies, which includes batteries. If passed, that would give a big boost to GM’s battery factory plans.
The sleeping giant has awakened, which is good news for EV advocates and enthusiasts. More choices in the marketplace are always welcome. But will the company continue to be the largest US automaker 5 years from now? That is no sure thing, despite such massive investment commitments.