General Motors Co. GM -1.41% confirmed plans for a multibillion-dollar investment to produce electric pickup trucks in Michigan, giving the Great Lakes region a boost as competition intensifies between states to win a bigger role in the industry’s shift to battery-powered cars.
The auto maker on Tuesday said it would convert a suburban Detroit factory into a center for the production of electric pickup trucks and build a battery-cell plant in Lansing, Mich. It plans to spend $4 billion to convert its Orion Assembly factory to build plug-in trucks and will split the cost of the $2.6 billion battery factory with partner LG Energy Solution.
On top of this spending, GM plans to invest about $500 million into two assembly plants near Lansing.
Altogether, GM plans to contribute nearly $6 billion of the $7 billion in the total costs for the projects, a figure that the car company says is its single largest investment in history. The spending is expected to create 4,000 jobs in the state, the auto maker said. Plans for the Orion revamp and the new battery-cell plant were first reported last month by The Wall Street Journal.
The Michigan projects come after years of investment by car companies to expand production in the southern U.S., moving the auto industry’s center of gravity away from the industrial Midwest.
Last year, Toyota Motor disclosed plans to build a battery plant in North Carolina, and Ford Motor invested in three battery plants, two in Kentucky and one in Tennessee, as well as a new electric-truck plant near Memphis, Tenn.
In previous years, Volkswagen AG expanded electric-vehicle output at its factory in Chattanooga, Tenn. Polestar, the electric-vehicle company owned by Chinese car maker Zhejiang Geely Holding Group Co., produces cars in South Carolina.
“This news is great for us and great for Michigan, the epicenter of the work we’re doing on EVs,” said GM President Mark Reuss. “Michigan will be the recognized hub and leader of innovation in the U.S. for EV [research and development] and manufacturing.”
‘Michigan will be the recognized hub and leader of innovation in the U.S. for EV [research and development] and manufacturing,’ GM President Mark Reuss said.
Photo: Ryan Garza/Zuma Press
GM has announced a $35 billion investment into electric and autonomous vehicles through 2025 and plans to have factory capacity for more than 1 million electric vehicles, part of its goal to surpass Tesla in U.S. sales of electric vehicles.
Other global auto makers also are funneling money into electric vehicles, a collective bet amounting to more than $300 billion through 2025, according to consulting firm Alix Partners. Still, EV sales accounted for less than 2% of Ford’s and GM’s 2021 total sales, and remain just a fraction of the autos market overall.
As supply chain disturbances have rattled auto makers, they have increasingly moved toward producing electric-vehicle batteries in house. Car executives have said they want control over that critical part of the electric-vehicle supply chain so they can help advance battery technology and protect against future shortages.
The $4 billion investment in the Orion Assembly plant will support production of the Chevrolet Silverado EV, which GM revealed earlier this month, and the electric GMC Sierra, planned to begin production in 2024. GM projects an electric-vehicle truck production capacity of 600,000 once Orion Assembly and its plant in Detroit are fully operational, though it declined to peg a timeline.
The auto maker built about 925,000 full-size gas-powered pickup trucks in North America last year, according to Wards Intelligence.
The battery-cell factory represents a 50-50 partnership between LG Energy Solution and GM. It is the third plant to be established through this partnership—they have two other factory projects in the works, one in Ohio and another in Tennessee.
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