GM Changes Strategy: More Gasoline Cars, Fewer Electric Vehicles
General Motors is abandoning its plans to produce electric vehicles at the Orion Assembly plant in Michigan. Instead, the enterprise will begin producing gasoline off-road vehicles and pickups, starting in 2027. This decision is related to low sales of electric models such as the Chevrolet Silverado EV and GMC Sierra EV, which sold only 2,383 and 1,249 units respectively in the first quarter.
The Orion Assembly plant was initially supposed to become a center for electric vehicle production, but due to falling demand, GM decided to change its plans. It will now produce the updated Chevrolet Silverado, Tahoe, Suburban, as well as the GMC Sierra, Yukon, and Yukon XL. Production of electric pickups will continue at the Factory Zero plant in Hamtramck.
Another Unexpected Decision
GM also announced that the gasoline version of the Chevrolet Blazer, which was planned to be discontinued, has been given a “second life.” Its production will begin at the Spring Hill plant in 2027. This same plant produces the electric Cadillac Lyriq and Vistiq, as well as the outdated XT5 and XT6 models.
“Today’s announcement demonstrates our ongoing commitment to manufacturing vehicles in the U.S. and supporting American jobs,” stated GM CEO Mary Barra.
The company is investing about $4 billion in retooling production, which is approximately equal to the amount it had planned to spend on converting Orion Assembly into an electric vehicle production center. This confirms that GM is betting on traditional cars, as demand for them remains stable.
Furthermore, Fairfax Assembly will begin producing the new Chevrolet Bolt EV by the end of this year, and in 2027, it will be joined by the gasoline Malibu. This will help support sales, which grew by 30% in the first quarter. Although some Malibu production will remain in Mexico, moving some capacity to the U.S. may be related to tariffs.
It seems GM is preparing for a long period where gasoline cars will remain a staple. Despite ambitious electrification plans, the company is forced to respond to market realities and consumer needs, which are not yet ready for a mass transition to electric vehicles. This could become a trend for other automakers facing similar challenges.