GM's Electric Vehicle Production Struggles

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【Summary】GM's Chief Financial Officer, Paul Jacobson, admitted that the automaker has faced challenges in scaling up EV production, particularly due to issues with a supplier and the technology involved in module creation. Despite slower-than-expected deliveries, customer reception for the Cadillac Lyriq has been positive, with high demand from younger buyers. GM aims to produce EVs faster to meet increasing demand, with a target of 400,000 cumulative electric vehicles by mid-2024.

FutureCar Staff Aug 26, 2023 10:12 AM PT

GM's Electric Vehicle Production Struggles

During the J.P. Morgan Auto Conference, GM's Chief Financial Officer, Paul Jacobson, addressed investor questions regarding the automaker's EV production. Jacobson admitted that GM had encountered some "startup challenges" in this area.

When asked about the Hummer EV and Cadillac Lyriq, and the perception that GM was struggling to scale both vehicles, Jacobson explained that the challenges primarily revolved around a supplier and the technology related to module creation. This bottleneck in the process has caused delays.

However, Jacobson reassured attendees that the problem had been identified and addressed. He also mentioned that GM was working on increasing the volume of Lyriq deliveries. In 2022, GM delivered 122 Lyriqs, which was below their expectations. In July, they delivered over 1,000, but the goal is to drive that volume even higher.

The Cadillac Lyriq, Cadillac's first EV, gained significant attention when reservations were made available in September 2021. It sold out within ten minutes, with most buyers coming from the younger generation. This is noteworthy because the average age of a Cadillac buyer is typically in their mid-50s.

However, customers have faced delays due to a slow start at the Ultium plant in Ohio, US, caused by software issues with the vehicles. Jacobson acknowledged that the production process has been slower than desired but emphasized that the supply side is improving.

Despite the challenges, customer reception for the Lyriq has been positive, and Jacobson expressed confidence in the demand for EVs. The main obstacle lies in GM's ability to produce them quickly enough.

Concerns and criticisms about GM's EV production have been circulating for some time. Earlier this year, CEO Mary Barry pointed to a supplier as the reason for the slow start of GM's electric vehicles. However, the automaker remains committed to its targets. In the first half of 2023, GM produced 50,000 EVs for North America and aims to manufacture 100,000 more in the second half. By mid-2024, GM's goal is to have a cumulative total of 400,000 electric vehicles in North America.