General Motors plans to increase production of electric vehicles in the second half

DETROIT – When General Motors launched the GMC Hummer EV in 2021, the automaker touted it as a new benchmark for its vehicle development time, but the truck’s production and sales pace has been anything but.

The Detroit automaker sold just 854 vehicles in 2022. That’s an average of 17 trucks per week, including downtime at the production plant. That’s a far cry from a traditional multi-month production ramp-up, even though it’s an all-new vehicle.

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But it’s not just the Detroit-produced Hummer. These are all new electric vehicles from GM in the United States, as the company slowly ramps up production of vehicles on its new “Ultium” electric vehicle platform.

GM executives said on Tuesday they did not expect significant increases in production of new electric vehicles until the second half of this year – making the Hummer a nearly two-year ramp-up and causing a slowdown painful production of the new Cadillac Lyriq in a factory in Tennessee.

The problem? Cell production at GM’s new or under construction US plants, executives say.

“We will be growing electric vehicle volumes throughout the year,” GM Chief Financial Officer Paul Jacobson told reporters Tuesday morning after the fourth quarter results were released. “We’ll obviously be at a significantly higher run rate in the second half of this year, other than what we’re starting and it’s all really pegged to cell capacity.”

In October, GM CEO Mary Barra pushed back GM’s plan to collectively produce 400,000 electric vehicles in North America by six months due to an inability to ramp up battery production as quickly as the company had planned it.

Doug Betts, an industry veteran and automotive president of JD Power, said a normal ramp-up — from start or production to hitting targeted units — is around 30 to 60 days. However, this may vary by product, depending on the amount of new parts and employee procedures.

Barring supply chain issues, Betts said electric vehicles should be easier and faster to build than traditional vehicles with internal combustion engines for an experienced automaker.

Barra said Tuesday that ramp-up remains “on track” for the Ohio facility in addition to completing construction of similar battery facilities in Tennessee later this year and in Michigan. in 2024. She said the Ohio plant should be at full production capacity by the end of it. of this year, adding about 20% per quarter.

“This is the breakout year for the Ultium platform,” Barra told investors Tuesday, adding that the Tennessee factory should be able to scale faster. “These factories will help us meet pent-up demand…and it keeps our other EV launches on track.”

GM announced on Monday that it has started production of the GMC Hummer SUV EV at a plant in Detroit. This vehicle is expected to be followed by a Chevrolet Silverado electric work truck by mid-year and electric versions of the Chevrolet Blazer and Equinox in the second half of 2023.

GM says it is planning for the medium to long term and is “well positioned” with its Ultium electric vehicles, including securing all ram materials needed for North American production capacity of 1 million units by 2025. The company said on Tuesday that it plans to invest $650 million in Lithium Americas in an effort to gain better access to lithium, a key component of electric vehicle batteries.

“It was carefully timed,” said Stephanie Brinley, principal automotive analyst at S&P Global Mobility, also pointing to supply chain issues in the automotive industry. “Long term, they better be careful. … They’re still in a good position to lead as time goes on.”

But others like Hyundai engine and Ford engine have increased the production of electric vehicles. Industry leader You’re here also aims to produce 2 million electric vehicles worldwide this year.

Ford, which ranked second in electric vehicle sales in the United States last year, plans to increase production of its electric Ford F-150 Lightning. GM’s rival in Detroit has been able to ramp up production of the electric pickup truck to sell more than 15,600 vehicles since the truck went on sale in May.

Following Tesla and Ford’s recent price cuts on its Mustang Mach-E crossover, Jacobson said the company believes its electric vehicles “are well positioned” when it comes to price. GM’s electric vehicles currently range from $20,000 Chevrolet Bolt models to over $100,000 Hummer vehicles.

GM plans to increase production of Bolt models, which use older battery technology, to 70,000 vehicles this year, GM said.

To help scale its electric vehicles, GM could potentially change the packaging of its batteries to cylindrical cells instead of pouches.

Barra declined to comment on media reports of such a change, or the addition of the cylindrical cells, to his plans. She said the company evaluated different battery form factors and designed the Ultium platform to be independent of current battery forms.

“We can research what the right battery will be for the specific vehicle from a performance standpoint, so we have that total flexibility,” Barra said.

She said GM currently uses cylindrical cells for electric vehicles in China, including the Lyriq. Dealers delivered about 2,400 vehicles there from September to December, she said. That compares to 122 Lyriq EVs with pocket cells in the US

It’s unclear whether switching to cylindrical cells would increase production in the United States, as production at the battery factory in China is more advanced than in America.

A GM spokesperson declined to comment on whether an announced fourth battery plant in the United States could produce cylindrical cells. Talks between GM and LG Energy Solution have stalled recently, and the automaker is looking for another partner.