General Motors (ticker: GM) found itself in the tail end of the EV race against Ford Motor (ticker: F) even as it attempts to electrify its most popular trucks. However, it is currently working to catch up to its peers. GM announced its planned investment worth $7 billion on Michigan facilities earlier this week.
The company announced that this investment would create roughly 4000 new jobs while at the same time expanding its electric-vehicle and battery manufacturing capacity. According to the company, this is its single largest investment in its long history. This cash injection will make the plant in Orion, Michigan, the second U.S plant making electric versions of the Chevy Silverado and GMC Sierra pickup trucks.
Earlier this month, the company revealed the new all-electric Silverado, with the truck expected to be available for purchase as early as 2023. This news comes about one year after Ford released its all-electric F-150.
Both vehicles represent a massive step into the future for GM and Ford, especially since trucks account for roughly 20% of all new light-vehicle sales in the U.S.
Possibly after realizing where the new battle frontier lay, GM decided to defend its tuff and take it a step further by placing its bid to become an EV leader.
“Today, we are taking the next step in our continuous work to establish GM’s EV leadership by making key investments in our vertically integrated battery production in the U.S and our North American EV production capacity,” said GM CEO Mary Barra. “We are building on the positive consumer response and reservations for our recent EV launches and debuts.”
The exciting new products include the Silverado, the electric GMC Hummer, Cadillac LYRIQ EV, and Chevy Equinox EV.
On top of the expanded manufacturing capacity, the planned $7 billion is set to include $2.6 billion for the battery manufacturing. GM also plans to build another battery plant with LG Chem (ticker: 051910. Korea), its battery partner, in Lansing, Michigan. This will be the third GM facility in the U.S.
The spending Is part of GM’s earlier announced $35 billion on EV-related expenditure, scheduled to happen between 2021 and 2025. It’s predicted that this planned spend is likely to yield about 30 new EV models by 2025.
GM stock might not get a boost despite the exciting news since it’s part of the larger plan. Shares dropped 1.8%, representing another day in the red for markets. The S&P 500 and Dow Jones Industrial Average were recently down 1.3% and 0.3%, respectively.
Due to the recent market selloff, GM stock has been battered heavily, with shares falling for seven consecutive days. The stock is off 12% year to date.