GM to stop making Chevrolet Bolt, its best-selling electric vehicle
General Motors is ending production of its Chevrolet Bolt models by the end of this year, the Michigan automaker said Tuesday, adding that the local plant currently tasked with making the Bolt will be converted for the manufacturing of electric pickup trucks.
GM is stopping Bolt production even though company officials say it's their top-selling electric vehicle. GM debuted the all-electric car in 2016, a decade after it introduced the EV1, which was discontinued in 2002. The Bolt is one of the reasons why GM is a top market leader in the EV market, GM CEO Mary Barra said Tuesday.
"We delivered more than 20,000 EVs in the U.S. in the quarter, on the strength of record Bolt EV and Bolt EUV sales and rising Cadillac LYRIQ deliveries," Barra said during an earnings call. "This moves us up to the second market position and increased our EV market share by 800 basis points."
GM workers build the Bolt in a 4.3 million-square-foot facility in the Detroit suburb of Orion Township. In 2022, GM said it planned to renovate the Orion plant and use it for making the electric versions of the GMC Sierra and Chevrolet Silverado pickup trucks. Barra said Tuesday that the renovation project is almost finished.
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"We have progressed so far that it's now time to plan to end the Chevrolet Bolt EV and EUV production, which will happen at the very end of the year," Barra said. "When Orion EV assembly reopens in 2024 and reaches full production, employment will nearly triple, and we'll have a company-wide capacity to build 600,000 electric trucks annually."
In discontinuing the Bolt, the automaker is moving away from hatchback-style vehicles and opting for SUVs and pickup trucks, models that customers are increasingly favoring the most, Ivan Drury, director of insights at automotive research firm Edmunds, told CBS MoneyWatch.
"GM likely viewed the Bolt models as little more than stepping stones to its next-generation EV technology," Drury told CBS MoneyWatch. "While range and price are compelling, the design, size and slow charging speeds never quite caught on with consumers, and a series of recalls due to fire hazards likely also made an impact."
Challenges ahead for EV leader
GM is managing the transition from combustion engines to electric vehicles well, according to Edward Jones analyst Jeff Windau, but the successful conversion will still be difficult to orchestrate. As EV sales start to increase and gas vehicles wind down, GM could find itself in a position where it's not fully using factories for either type of vehicle, which would hurt profits, he said.
EVs are drawing more attention within the automotive industry, as shoppers grow curious about their capabilities, and automakers like Tesla and Ford race to assert dominance in the market. A survey released earlier this year from Deloitte found that nearly 7 out of 10 car shoppers want to buy an EV but are concerned about the price.
The average new EV sold for $58,940 last month, up from $58,385 in February, according to Kelley Blue Book. New tax credits enacted last year by President Joe Biden in the Inflation Reduction Act could drop that figure lower for some drivers.
The U.S. Treasury Department released a list of which vehicles are now eligible for a $7,500 tax credit. The Bolt, along with four other Chevrolet vehicles, is among the vehicles that qualify for the tax break.
The automaker plans to roll out a Chevy Equinox EV later this year that will start around $30,000; it's also working on a lower-cost EV with Honda.
New battery cell plant in U.S.
GM and South Korea's Samsung SDI plan to invest more than $3 billion in a new electric vehicle battery cell plant in the United States, the companies said Tuesday. Samsung was picked by GM as partner for its fourth joint venture battery cell factory, after some Chevrolet Bolt batteries made by LG caught fire, forcing GM to recall about 142,000. The recall cost GM about $1.9 billion, and the automaker said it was reimbursed for the cost by LG.
A global shortage of computer chips and other parts forced the auto industry to slow production last year, driving up prices as demand stayed strong. But the parts shortages and production are starting to improve. GM said it expects to start turning low-to-mid single-digit profit margins on electric vehicles in 2025.
GM reported $2.37 billion in profit from January through March, up from $1.99 billion in the previous year.
The Associated Press contributed to this report.