DETROIT (WWJ) -- General Motors, which once laid out plans to be all EV company, is again significantly scaling back its electric vehicle production. As GM this week slowed production at Factory Zero in Detroit, it’s now announced cutbacks at plants in Spring Hill, Tennessee and Kansas City.
"General Motors is making strategic production adjustments in alignment with expected slower EV industry growth and customer demand by leveraging our flexible ICE and EV manufacturing footprint,” said GM in a statement.
The Spring Hill plant, which builds the Cadillac Lyriq and Vistiq will shut down for a week in October and again in November, and be idle the entire month of December. It will also see slower production after it reopens in early 2026. GM is also delaying the start of a second shift at their Kansas City assembly plant, which is still planing to begin building the new Chevy Bolt later this year.
“There is just a sense within the industry right now that aspirations for electric vehicle market share growth are not going to be met,” says Karl Brauer, an industry analyst with iseecars.com. The product plans that assume those aspirations need to be adjusted.”
GM North America President Duncan Aldred telegraphed this in a blog post where he detailed record EV sales in August and expected more of the same in September. But, EV sales are expected to fall significantly after federal tax credits expire at the end of September.
“We will almost certainly see a smaller EV market for a while, and we won’t overproduce.”
Smaller inventories mean less need to add incentives to vehicles to get them to sell.
“Meanwhile, we are seeing marginal competitors dramatically scale back their products and plans, which should end much of the overproduction and irrational discounts we’ve seen in the marketplace,” wrote Aldred.
General Motors had once aspired to be an all electric carmaker. But recent changes in the marketplace have it now promoting the fact that it has a full portfolio of vehicles, and is seeing very strong sales of gasoline powered pickups and SUV’s so far in the third quarter.
Very strong electric vehicle sales in the third quarter are likely due to buyers wanting to get tax credits before they expire. Analysts like Karl Brauer say this could lead to a very different EV sales environment in the final three months of the year.
“We’re absolutely going to see a whipsaw effect from spiking EV sales in the third quarter to dropping off a cliff.”