GM’s 2024 Chevrolet Equinox EV during a media launch event for the vehicle in Detroit, May 16, 2024.
Michael Wayland / CNBC
DETROIT – General Motors is trimming its expected sales and production of all-electric vehicles this 12 months, as U.S. adoption of EVs occurs slower than expected.
GM Chief Financial Officer Paul Jacobson said the corporate now expects production of its all-electric vehicles to range from 200,000 to 250,000 this 12 months, down from a previously announced range of 200,000 to 300,000. The corporate has recently said it is going to produce volume to match demand, which is growing more slowly than had been forecast.
“So on the lower end of that, and I believe it reflects the momentum that now we have within the business,” Jacobson said Tuesday during a Deutsche Bank investor event.
Jacobson said GM expects EVs to make up 8% of U.S. sales industrywide this 12 months. That is lower than many other auto analyst forecasts, which expect EVs to represent around 10% of industry sales in 2024.
GM expects its EVs to be profitable on a production, or contribution-margin basis, once it reaches production of 200,000 units. That milestone remains to be expected within the fourth quarter of this 12 months, he said.
Jacobson said the automaker, which doesn’t report monthly sales, sold greater than 9,500 EVs in North America in May. Sales of GM’s all-electric vehicles remained minuscule throughout the first quarter. EV sales totaled 16,425 units, or 2.8% of the automaker’s overall sales throughout the period.
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GM, Ford and Stellantis shares in 2024.
The Detroit automaker is in the midst of launching its newest EVs, including its latest entry-level Chevrolet Equinox EV. The vehicle will start at around $35,000 before EV incentives, corresponding to a federal credit of as much as $7,500. GM also recently relaunched its Chevrolet Blazer EV after halting sales as a result of software issues.
The 2 latest EVs, which share GM’s “Ultium” EV platform and technologies, are crucial for GM’s EV growth.
Along with making the EVs announcement, Jacobson said the corporate expects its second-quarter earnings to be higher than the primary three months of the 12 months. He also said the automaker this month will invest $850 million into its troubled Cruise autonomous vehicle unit to assist with operational money.
The comments by Jacobson come after the corporate on Tuesday morning announced that a latest $6 billion stock repurchase authorization has been approved by its board, largely backed by sales of its traditional gas-powered vehicles.
The brand new buyback authorization comes as an accelerated $10 billion share repurchase program announced in November 2023 is predicted to be accomplished by the tip of June.
“We’re very focused on the profitability of our [internal combustion engine] business, we’re growing and improving the profitability of our EV business and deploying our capital efficiently. This permits us to proceed returning money to shareholders,” Jacobson said in a release.
Correction: GM is trimming its EV production goal to 200,000 to 250,000 vehicles in 2024. A previous version of this text misstated that range.
