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GM EV Production Slowdown Is A Mistake, Says Investment Firm CEO

Cathie Wood, the CEO of Ark Invest, says that GM’s decision to pull back on EV investment is a mistake. Late last year, GM announced that it was pulling back on its plans to build 400,000 EV units in North America by the mid-2024 calendar-year timeframe. Wood addressed the current EV market during a recent Ark Invest webinar, during which she discussed Tesla and mainstream automakers like General Motors and Ford.

The front end of the Chevy Silverado EV.
“On other traditional automakers, you know, Ford is pulling back its production plans for 2024 for the F-150 Lighting, but Ford’s not alone,” Wood said during the recent webinar. “We see GM pulling back some of their EV goals for the next year as well.”

Wood indicated that traditional automakers are not able to produce EVs as cost-effectively as Tesla, owing to the fact that Tesla made the investment into large-scale EV production more than a decade ago and has successfully ramped up those efforts to today.

“We do think it’s a mistake that [Ford and GM are] pulling back on electric vehicles, and it’s only going to help Tesla cement even more of a lead in this space because we do see this as a future.”

During General Motors’ Q3 2023 earnings presentation held last year, company CFO Paul Jacobson detailed the automaker’s future EV plans, indicating that General Motors was pulling back on its targets of 100,000 EV units produced by the second half of 2023 and cumulative 400,000 EVs from 2022 to the first half of 2024. General Motors did not provide new EV production targets, but rather, Jacobson indicated that the automaker was “moving to a more agile approach to continually evaluate EV demand and adjust production schedules to maximize profitability.”

The pullback included a delay in retooling the GM Orion plant for Chevy Silverado EV and GMC Sierra EV production, with General Motors retiming the $1.5 billion investment. While EV growth has slowed, reports indicate a substantial 56-percent jump in EV sales for the first 10 months of the 2023 calendar year.

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Jonathan is an automotive journalist based out of Southern California. He loves anything and everything on four wheels.

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Comments

  1. I’m SHOCKED that someone in the WEF would say this, SHOCKED!

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    1. She is talking through her hat. EV production will bring GM to its knees,in the long run.

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    2. We as a family do not want an electric vehicle!

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  2. The problem is GM EV offerings are barely competitive with the segment benchmarks. Ultium needs a rethink before they could hope to sell that many.

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    1. Charlie:

      How so?

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      1. She is talking through her hat. EV production will bring GM to its knees,in the long run.

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      2. Megeebee they are all massively overweight. That translates to more frequent and longer charging sessions. Also no frunks in anything but the largest of trucks. To put it nicely, the batteries and body structures are woefully inefficient and about a generation or two behind the leading competition in terms of packaging and features for the customer.

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        1. None of what you said is true. My EV does not have a frunk. Before owning an EV I never had a frunk. Nor have I ever needed a frunk. GM paid to install a level 2 outlet in my garage. I charge 99% at home. I rarely charge on public chargers and when I do, I take a 30 min meal break. I’m not inconvenienced at all. My car drives and handles way way way better than any of the luxury gas cars I’ve owned over the years. I firmly believe the only people who speak negatively about electric vehicles have never owned one. I’ve owned mine for nearly 8 months and no way I could ever go back to the extremely outdated old fashioned gas cars. I wouldn’t think of it!

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  3. Only 3 comments before this one, and it’s kind of what I would expect.

    Let’s just go on record and say this. Ford and GM pulling back is setting them back in a huge way. They (and Toyota) can say what they want, but the future is EV with ICE (both gas an diesel) being the small fraction of what it was in 2023. But for now, they (GM/Ford/Toyota) are playing it very safe for the 2023 market. Problem is that 2023 market is gone and only going to get further back in the review mirror. By the time they realize it, Hyundai, Kia, VW, BYD, Geely (and obviously Tesla) will be so far in front that GM may never recover.

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    1. While agree EV is the future, I think GM delaying some investment may be good. At this point, they’re only delaying some products by a few months. And they’ve delayed a second production facility for Silverado and Sierra EVs. Orion is really the only facility they’re holding back on and maybe they don’t have the orders they’d like for trucks and can produce sufficient quantities at The current facility. Additionally, they’re not delaying and of their battery facilities and found a different partner for their 4th facility since LG pulled out.

      I suspect the real reason for delaying some models is related to the Blazer release and the stop sale due to software issues. They want to get the bugs fixed on that and once that’s fully working, they’ll release Silverado, Sierra, Escalade IQ, Equinox, plus Cadillac’s Optiq and Vistiq all by end of year. Then once they start production, GM will be revealing more models to come.

      And your claim that Ultium is behind is not true. While not a leader in all fronts, it is competitive on all fronts. Considering how this technology is developing, they are in a good place and improving.

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      1. With the Bolt counting as a beta testing run this is GMs first gen at mass produced EVs and no one has come out of the gate without major issues. Getting to the point where EVs are costing less to produce than Ice should be the main focus. Not who can build the most right now where efficiency is at it’s worse and the cost is still high. As long as the R&D remains to be the main focus GM will be in a good spot for the future.

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  4. Wood should invest her personal wealth in EV production. Her statements are defending her funds investments in EV production that look like they are about to drop another 25% because demand is less than expected. Pumping to preserve.

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  5. This investment firm must have a short on GM.

    Only sane reason they’d want to GM go back to the bad old days of stuffing dealer lots with low-demand vehicles, then resorting to heavy incentives to move those vehicles.

    “Continually evaluate EV demand and adjust production” is the correct strategy. “Build now, figure the rest out later” is not.

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  6. Tesla sales didn’t take off until the model 3. Lower cost and price point. GM and others are trying to do what Tesla did, start with high price models to recoup some of its. Investment, then go for the mass market. $100,000+ price point is scary for new technology when ICE vehicles maybe 1/2 MSRP of EV’s.

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  7. IDIOTS SHOOT THEIR MOUTHS OFF WITHOUT STATING ALL THE FACTS. GO AND ASK YOUR INSURANCE COMPANY HOW MUCH IT COSTS TO INSURE AN ALL ELECTRIC CAR OR TRUCK. A SMALL KIA EV BATTERY SYSTEM COSTS $60,000 TO REPLACE. IT. NO INSURANCE COMPANY CAN IGNORE THE REAL COSTS. THE SHAREHOLDERS OF THE INSURANCE COMPANIES ONE DAY WILL CUT OFF ALL INSURANCE FOR ANY ELECTRIC VEHICLE, BECAUSE INSURANCE COMPANIES DON’T LIKE TO LOOSE MONEY.

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    1. Wow Mark IN ALL CAPS.

      Maybe you need to call Geico then and let them know that I drive a Bolt EV. My car before this was a 2021 Malibu. Guess what? When I got the Bolt, my insurance didn’t change. So please call them and let them know they messed up and didn’t triple my insurance.

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    2. If the $60k battery was damaged in a wreak, the vehicle would be totaled when it cost more to fix it than actual vehicle value

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    3. BS. You must have taken a sip of that cool aid on the 60k battery. My insurance on my ev is no more than the last ICE vehicle I had btw the word is lose, not loose. Ignorant uniformed post. Dont like evs, dont buy one. Meantime I am on me second one and haven’t bought gas since 2019

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    4. My 2023 Tesla Model Y LR costs less to insure than my Colorado ZR2 in my state. I don’t use Tesla Insurance because I don’t want my rates going up based on my driving habits. I’ve seen the 60k Kia battery Fud along with the 28k Volt battery replacement. It amazes me how outlier or completely fabricated stories have legs because it aligns with someone’s narrative. You don’t have to embrace BEVs, I didn’t until I drove a Tesla. I also believe GM is squandering an opportunity to grow their production and sales by again kicking the can down the road. They can’t just hit a switch and all of a sudden make 500k+ from the embarrassing small amount they make now. Hyundai-Kia will gladly take even more sales from GM (next year they will be producing batteries in the US and qualify for the IRA rebate) while Tesla will continue to gain market share as they already outsell Jeep, Subaru, GMC, Ram and all of VWAG (VW, Audi, Porsche, etc) in the US. Without the Volt, GM will be fortunate to sell 40-50k BEVs in 2024 (less than Rivian), which is neither profitable nor will it get new customers into GM cars. BEV demand is greater than people think, just not for $70-110k. The BEV market is still outpacing the overall market and was up 46% YoY.

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  8. Ark is an ESG worshiper.

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    1. Cathey Wood probably thinks Biden will win.

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  9. I beg to differ with Wood’s conclusion. There’s a LOT of time to get into the EV market. Industry standardization hasn’t even fully developed and the biggest changes have yet to be made. Better to enter the market right the first time than to do it wrong and painfully retrace your steps.

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  10. Wood is clearly a moron with no understanding of the current EV market and consumer desires.

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  11. This just applies to me right now but price and customer service are what’s keeping me with ICE right now. A small accident or glitch in a sub-system that deprives me of my 70+ thousand dollar truck is less than ideal.

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  12. I had planned to buy an equinox ev and would have a year ago. But technology has bypassed the ultium platform and I am now going to buy something with an LFP battery to fight the high temps in my state. So, GM lost out.

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  13. Not sure exactly what GM’s EV game plan is…. Only vehicle currently getting a fed tax break (and $7,500 price deduction at point of sale) is the Bolt EV and Bolt EUV – both of which dealers in Western NY where I am tell me they are only being offered for presale – which means they are already sold when arriving at the dealership… Obviously the extant supply will run out before the end of January, or certainly February. Since NY State gives another $2,000 I’m considering trading in my 2019 VOLT on a new 2023 BOLT which they are letting go for $27,500. With the trade it will only be a small amount of cash along with smallish sales tax.

    Then GM will have just a few sales of EVs – mostly the Cadillac LYRIQ. They just spent over $25,000 on me replacing my Propulsion battery in mine… Only took a month… Two months prior to this, it had the Ubiquitous 12 volt dead battery update problem…. in that case I failed to take note as to how much it cost additionally to GM for warranty repairs.

    If my case is typical – GM is correct to slow down. The ULTIUM release has really cost GM.

    I disagree that GM will produce only EV vehicles in the future…. This is because there will always be SOME manufacturers like Honda and TOYOTA who will manufacture reliable ICE vehicles…GM cannot survive selling only trouble prone EVs, and if GM can’t make good ICE vehicles either, then customers will walk.

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    1. Billy, You haven’t been keeping up with the latest news. Blazer EV and Lyriq are directly discounting $7500 at the point of sale till June 30, 2024.

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      1. Mick1 — haha u think so huh?

        Blazer EVs can’t be sold at all. Too much bad publicity. Stop sale in effect.

        Supposedly some LYRIQs are still being sold, but even the loaner I had has been quarantined.

        $7,500 is nice. $8,000 in NY State due to high price.. Bolt is low price so $9,500.

        Of course with LYRIQ and presumably, eventually the Blazer EV (if they don’t get the batteries changed in time) – the $7,500 reduces the profitability of the LYRIQ… Somehow I think the Blazer EV will be not sold until the battery changes… $7,500 is a pretty big hit to have GM swallow it on every sale.. Overages mentioned here are from the NY State program which presumably are unaffected.

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  14. And GMA f@scism strikes again.
    Guess what? Well repost the comment yet again and continue to do so until you stop censoring the simple truth about Cathie Wood.
    Cathie Wood has no credibility considering her hedge fund has lost over 50% of its value in 2 years.

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  15. Two words seal the fate of EVs: energy density.

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  16. Volt has been very successful as will Nox. The trucks are expensive and a tough segment. Cadillac has yet to excite buyers and is a dying brand if things don’t change soon. Good cars but lousy advertising.
    EV is in its infancy. Rare earth extraction is dirty and there may not be enough for US. America will be a late adapter and hydrogen may be in the mix. Truth be told hybrids offer environmental best solution

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  17. Actually Tesla had a slow down this last quarter, just like everyone else. The difference is that Tesla’s PE is 75. Ford and GM’s PE are under 10. Tesla Needs Exponential growth, not linear growth. GM and Ford can rely on ICE and hybrid vehicles. I don’t understand what this person is talking about.

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