General Motors (GM), the leading US auto manufacturer by revenue, has scrapped plans to discontinue the Chevrolet Bolt, one of the most cost-effective electric vehicles (EVs) in the United States. While the current model is set to retire by year-end, the Bolt will continue its journey with an upgraded propulsion system based on more advanced battery technology.
Mary Barra, GM’s CEO, acknowledged the popularity of the Bolt among consumers, highlighting that the demand consistently outpaced supply. This is a key reason why GM is investing billions in electrifying its fleet, with a target to sell a million EVs per year by 2025. Further, GM has announced that by 2035, it intends to halt sales of vehicles powered by fossil fuels. This aligns with potential regulations from the Biden administration, which may compel automakers to make electric vehicles constitute two-thirds of their US fleets by 2032.
Previously, GM had announced in April that it would halt Bolt production and repurpose its Michigan plant to manufacture electrified versions of the GMC Sierra and Chevrolet Silverado trucks. The Bolt, available as a hatchback and a larger crossover, utilizes an older battery platform than GM’s latest Ultium system. Although this older platform is 40% more expensive, the Bolt’s starting price of $27,000 keeps it as one of the most accessible electric vehicles on the US market.
The decision to retain the Bolt comes on the back of robust sales, with nearly 34,000 units sold in the first half of this year. This figure represents a fourfold increase compared to the same period in 2022, with the Bolt accounting for over 90% of GM’s EV sales.
However, the Bolt faced a setback in 2020 when a recall was issued due to battery fires in certain vehicles. The recall resulted in an almost $800 million charge in the second quarter, with the total recall cost reaching $1.9 billion. Most of this burden will be shouldered by GM’s battery partner, LG Energy Solutions.
GM has not yet provided specifics regarding the new Bolt’s availability or production location. However, Barra expressed confidence in GM’s ability to develop and produce the new Bolt more rapidly and cost-effectively than a brand new vehicle.
In the first half of this year, GM achieved its goal to manufacture 50,000 EVs. It aims to double this output in the second half and produce 400,000 EVs next year. However, production of vehicles powered by the newer Ultium batteries has experienced setbacks due to supplier delays, affecting GM’s capacity to produce battery modules. To address this, GM deployed engineers to the supplier’s location and managed to improve the situation over the past six weeks.
This year, GM’s Cadillac Lyriq and the GMC Hummer EV, both powered by the new Ultium platform, have sold 2,300 and 49 units, respectively.
In the second quarter, GM reported a 38% rise from last year, with an adjusted earning before interest and tax of $3.2 billion. Its revenue increased by 25% to $45 billion. Citing robust customer demand, GM upgraded its guidance for the second time this year, anticipating adjusted earnings before interest and tax to reach between $12 billion and $14 billion.