General Motors has abandoned its plans to invest $300 million (£222 million) in its electric vehicle (EV) motor production division. Instead, the company will invest $888 million (£659 million) in producing new V8 petrol and diesel engines at its Tonawanda, New York factory.
Background
The decision comes as General Motors faces slowing sales of its electric vehicles in recent years. The company has seen a significant shift in consumer demand, prompting the change in production at the Tonawanda plant.
New Investment Details
The $888 million investment will be used to develop the sixth generation of General Motors’ V8 engine, which is used in the company’s full-size trucks and SUVs. The production upgrade will enhance machinery, equipment, tools, and facility renovations at the plant.
Quotes from Executives
Mary Barra, Chair and CEO of General Motors, stated: “Our significant investments in GM’s Tonawanda Propulsion plant show our commitment to strengthening American manufacturing and supporting jobs in the US.”
Tara Wasik, plant director at Tonawanda, added: “This investment represents an exciting new chapter for our plant and its workers. We’re grateful for the opportunity to continue supporting the Western New York community.”
Implications for Electric Vehicles
Despite the shift away from EV production, General Motors remains committed to its electric vehicle lineup. The company, along with its partner LG Energy Solution, is developing new lithium manganese-rich (LMR) prismatic battery cells. These batteries are expected to offer over 400 miles of electric range for SUVs and trucks while reducing running costs.
Context and Future Plans
General Motors continues to navigate challenging market conditions, including the impact of President Trump’s tariffs on foreign vehicle exports. The company has suspended exports of American-made vehicles to China following the tariff hike.
The Tonawanda plant, which has been in operation for 87 years, has produced approximately 77 million engines for various General Motors brands, including Cadillac, Chevrolet, GMC, and Buick. Production of the new V8 engines is set to begin in 2027, following the continued production of the fifth generation until then.
