GM Criticizes Competitors Selling EVs 'For Any Price They Can Get' | Carscoops

      Despite a decline in demand following the elimination of the tax credit, GM remains devoted to its existing lineup of electric vehicles (EVs).

      General Motors has reported a notable drop in EV demand since the federal tax credit was removed. The company anticipates that the market will stabilize once all incentives are completely phased out. CEO Mary Barra emphasizes that EVs are GM's "North Star" amid ongoing political challenges.

      During the Biden administration, automakers benefited from a consistent policy framework and a strong push for electrification. Since 2005, various forms of tax credits have incentivized the purchase of low-emission vehicles, until the shift in January.

      The return of Donald Trump to the presidency quickly disrupted that momentum, as his administration eliminated the EV tax credit, relaxed penalties for surpassing emissions targets, and adopted a generally adversarial stance towards electric vehicles, forcing automakers to reassess their strategies overnight.

      Currently, car manufacturers are encountering significant challenges. Following the cancellation of the federal EV tax credit at the end of September, GM reports a “significant” drop in demand. Nevertheless, the company expects to reach a more stable pace soon, albeit at a reduced level compared to before.

      “EV demand will likely be quite inconsistent in the near future, particularly as we transition away from the $7,500 credit, and we have already noticed a substantial pullback in demand this October,” stated GM’s chief financial officer, Paul Jacobson, during a recent earnings call. “However, we believe the EV market will stabilize from a supply perspective.”

      Jacobson noted that emissions regulations had turned segments of the EV market into a discount market, with certain brands nearly giving away electric cars to accumulate environmental credits.

      “There were several competitors selling EVs for whatever price they could achieve because they were eager to acquire the environmental credits,” he remarked.

      While he didn’t name specific competitors, Jacobson was alluding to the regulatory credits automakers could earn by selling EVs under the former system. If they did not generate enough credits or failed to acquire them from another brand like Tesla, they faced penalties.

      Looking ahead, GM seems optimistic about the future of EVs. CEO Mary Barra regards them as the company's “North Star” and stated that they won’t truly understand EV demand until early next year.

      Despite the current uncertainties, GM does not intend to discontinue any of its existing models and plans to concentrate on cost reduction in the upcoming years. For instance, the company is aiming to simplify production and standardize parts across its dedicated EV platform.

      “We’re also investing in new battery technologies, such as lithium manganese rich (LMR), which will help us reduce vehicle costs significantly,” Barra added.