GM invests in agile manufacturing strategy, building EVs alongside gas vehicles

TRAVERSE CITY, Mich. — General Motors is making sizable capital investments to retool internal combustion assembly plants for electric vehicle production, but the decision to repurpose existing sites is less expensive than building new factories and allows agility during the transition to EVs, President Mark Reuss said.

The automaker has adopted a flexible manufacturing strategy, with dedicated plants that build gasoline vehicles and EVs as well as plants that build both, to use existing capacity and meet customer demand.

"When you convert plants, it's large. In our case, it's not as large as trying to build a new plant," Reuss said at the CAR Management Briefing Seminars here.

"The agility road map, once you get past the initial spend of that, is pretty good and pretty efficient. But to be able to fund that expansion of both, you've got to continually invest in ICE," he said, citing launches of redesigned gasoline-powered vehicles this year, including large crossovers and the Chevrolet Equinox compact crossover. "You see all of those things happening at the same time as our launches of our EVs. Now, that's a big execution risk, but I would say, timed right with the supply base, we know how to do that pretty well."

GM set a target of having a zero-emission light-duty vehicle lineup in North America by 2035 and is introducing EVs in more segments this year, from top-end full-size pickups to the Equinox EV, which will start around $35,000 with shipping.

But as mass-market consumers hesitate to buy EVs over concerns from charging availability to price, the adoption curve has been flatter than some automakers initially expected, leading GM and others to delay investments. GM CEO Mary Barra in July said the company will postpone the start of electric full-size pickup production at Orion Assembly in Michigan until mid-2026 and delay launching Buick's first EV.

The EV market is "still growing. It's growing at a little bit slower pace, but it's not not growing," Reuss said. "The infrastructure piece of this is not coming as fast as everybody would like, but it is coming."

So, too, is the next-generation Chevy Bolt EV. GM took the Bolt, which had been built at the Orion plant on the automaker's older battery architecture, out of production at the end of last year and plans to redesign the vehicle onto its Ultium battery platform in 2025. The next-generation Bolt will be built at GM's Fairfax Assembly plant in Kansas.

GM has not yet revealed details of the vehicle or pricing, but it's expected to continue to slot below the Equinox EV.

"It went out of production because we had to convert a plant," Reuss said. "And so we're going to convert another plant to build the next-gen Bolt, and be profitable at that and get into the really low end part of that market."

Uncertainty in the EV market, adoption rates and timing have created challenges for suppliers, he said, but GM works hard to maintain those relationships.

"We've just got to be in it together. I think that's the best advice," Reuss said. "When something is short or you're having a problem because of a schedule that you couldn't meet, or we didn't meet, we're in it for the long haul."