Like the rest of the automotive industry, GM has had to contend with widespread supply chain disruptions and shortages, often resulting in production issues, delays, and feature constraints. Now, however, as GM moves to transition to all-electric vehicles, the automaker is aiming to mitigate potential future supply shortages via added production redundancy.
GM CEO Mary Barra
In a recent interview with Automotive News, GM CEO Mary Barra said that The General was applying lessons learned during the ongoing global microchip shortage to build up a more resilient battery supply chain as it moved towards large-scale EV production. To that end, GM is ensuring that battery suppliers source materials from a variety of locations instead of one starting in 2026, thus hopefully preventing production stoppages in the event of a future shortage or supply issue. A similar approach was previously applied to shore up supplies of crucial microchips, with GM opting to source components from multiple factories.
“We want to have a partnership where we both win together,” Barra said. “A lot of times, these are suppliers that are new to us, and so I’m excited about how we’re proceeding on that. And like I said, why do I feel confident? Because we got signed agreements. And we’ll just keep building on that.”
GM has announced that it has signed enough supplier agreements to secure the battery materials required to produce 1 million EVs in North America by the 2025 calendar year. GM has also committed $35 billion in investments for new all-electric vehicle and autonomous vehicle technology through 2025, while announcing plans to phase-out internal combustion from its light-duty vehicle lineup by the 2035 calendar year.
GM is now moving forward with its ambitious EV plans by building a series of EV battery production facilities in the U.S. under Ultium Cells LLC, a joint venture with LG Energy. The first Ultium Cells plant in the U.S., located in Ohio, began production in August.
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Comments
This will cover shortages or labor issues.
This is pointless. I work in an industry that relies heavily on suppliers. We have dozens and dozens of suppliers. If they are all short on product, then so are we. If a shortage is industry wide, it is industry wide. It doesn’t matter how many suppliers you have. If none of them can get the raw materials or components to make what you need, you don’t get it. No supplier in their right mind is going to sign an agreement that guarantees availability of product, Our customers have asked us to do that very thing, and we always refuse or include language that addresses supply chain shortages.
Sounds like by 2035 there will be no more light duty ICE powered vehicles. I am due for a new car and refuse to buy an EV. That means any car I get next year will most likely be my last ICE powered vehicle as I keep cars 8-10 years. Kind of depressing.
So where in the article does it say a supplier has to guarantee they will supply product regardless?
What it does explain is that GM will work with multiple suppliers who get materials from multiple locations. This will minimize the potential of a catastrophe taking out the supply of any given product. No more instances of one supplier providing all of a single product for all their lines. I’m actually quite surprised GM didn’t have this in place already.
A perfect example of GM needing multiple suppliers related to the hood insulation issue GM encountered earlier this year. They had a single supplier that provided good insulation for multiple vehicle lines. The supplier had catastrophic flooding that took down a main facility and GM had no alternatives.
Since you refuse to consider an EV, GM will need multiple suppliers as these extraordinary catastrophes will continue to increase.
Are you part of the Supply Chain team at GM and we can blame you for many of their supply chain issues?
Arcee’s point is that having multiple suppliers does not mean the supplied product is actually available. If you send 10 men out to fish, but only 1 brings back a catch, you only have 1 supplier at the moment — not 10.
Basically, it doesn’t matter if you have 1 supplier, 6, or 78 supplying finished battery components. If China, South America, South Africa, countries hostile to the USA, etc. for any reason restrict/won’t supply U.S. companies and their partners (or there simply isn’t enough being dug out of the ground), then there is a shortage of lithium and rare earths, and GM really hasn’t solved the problem.
The General would probably be better served by lobbying the liberal mindset about opening rare earth mines and processing smelters in the USA, along with favorable trade agreements/treaties, rather than relying on foreign materials — which are incidentally WAY more outside of our control, influence, and dependence compared to oil.