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GM CEO Mary Barra says electric vehicles will be profitable by 2025


common engine says it expects its portfolio tram to turn a profit in North America by 2025 as it grows the battery and assembly plant capacity to build more than 1 million electric vehicles per year.

CEO Mary Barra used the pledge to kick off the company’s investor day event on Thursday in New York.

Profit figure includes car sales, benefits from emissions She said tax credits and revenue from the sale of software and components.

Barra says the company’s electric vehicle portfolio attracts more customers than its competitors.

GM The EV lineup includes a plan to sell a small SUV for around $30,000, along with a luxury SUV, pickup and Hummer SUV in the next two years.

The Detroit automaker has a goal of selling only electric passenger cars by 2035.

GM is sticking to Barra’s commitment to sell more electric vehicles in the US than market leader Tesla by mid-decade.

“Our commitment is to lead the industry,” Chief Financial Officer Paul Jacobson told reporters ahead of the investor day event. “We believe that with the infrastructure we’ve built and the vehicles you’ll see today, we’ll be able to achieve that.”

A more realistic look

The profit forecast for electric vehicles appears to be a step back from previous predictions that a new generation of GM electric vehicles will make money from the start.

But GM said earlier projections of immediate profit did not include the capital costs of switching to new technology. Profit projections for 2025 on a pre-tax basis including capital costs of battery factory construction and converting internal combustion plants to electric vehicles.

Jacobson said it will take time for personal electric vehicles to reach “low to mid-single digit” profit margins by 2025 as costs are spread across more vehicles. “If you look at any individual (media) program, there may be better performance than what you see overall,” he said.

Jacobson said EV margins will be even higher when clean energy tax credits from the federal Inflation Reduction Act are in place.

Despite economic turmoil and the possibility of a recession, GM looks a little more confident about this year’s financial results, saying on Thursday that it expects full-year pre-tax earnings to be $13.5 billion to $14.5 billion. That was within the previous guidance range of $13 billion to $15 billion. The forecast for free cash flow, the cash remaining after operating and capital expenses, ranges from $7 billion to $9 billion to $10 billion to $11 billion for the year.

GM also said their Brightdrop Commercial vehicle which makes vans and electric vehicles, will contribute more than $1 billion in sales next year.

Shares of GM rose slightly on Thursday as broader markets fell.

For new carGM will launch an all-electric version of the Chevrolet Corvette next year, said President Mark Reuss.

“This will once again set the world standard for performance,” he said.

A summary of what’s new

Reuss has offered glimpses of other new or improved GM vehicles coming in the next two years. He said the new internal combustion vehicles will build on the existing platform, saving costs but still allowing the company to make significant upgrades.

Among the items to be revised or new next year are Chevrolet Traverse Three-row SUV, as well as the new, and refurbished Buick SUV chevrolet trax Small SUVs start around $19,000.

In 2024, GM will redo the third row of seats GMC Academy Reuss says SUV, makes it more like a truck. It will then improve the internal combustion version of Chevy Equinox Small SUV in the world’s largest market segment.

As for electric vehicles next year, GM will revive the Buick Electra name for a new SUV that will go on sale first in China, then in the US. and a compact SUV from Cadillac.

Among the 2024 EVs are the GMC Sierra full-size pickup truck, the Cadillac full-size SUV, and the full-size Buick and Chevrolet. Electric Car mainly for China.

Buy online (savings go to GM)

Reuss also said GM is improving the way customers buy electric vehicles, giving them the option to buy entirely online or in-store. authorized dealer and save the company $2,000 per vehicle.

More than authorized dealer holding huge inventory, they will keep fewer cars on their shipment. When a customer orders an electric vehicle, it arrives from three distribution centers on the coasts of the United States. Reuss said the centers, two in California and one in Georgia, will provide common equipment combinations and allow for delivery within four days.

The system will automate a lot of finance and insurance cost.

“This translates into $2,000 per unit efficiency and cost reduction for GM,” he said, adding that the savings will go to GM.

Reuss also criticized Tesla, the U.S. electric vehicle sales leader, telling analysts that more than 11,000 Tesla owners have had their vehicles serviced at a GM dealership. He said the dealer network is a big competitive advantage for the service.



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