Shares of General Motors Co. (NYSE: GM) were up 1.8% in afternoon hours on Wednesday. The stock has gained 48% since the beginning of this year and 128% over the past 12 months. The race towards an electric future is heating up in the automobile industry and GM is going head to head with its rival Ford (NYSE: F) for the same. Both companies recently increased their investments in electric and autonomous vehicle development.
GM has decided to increase its investments in electric and autonomous vehicles from 2020 through 2025 to $35 billion, which is a 75% increase from its initial commitment. In March 2020, GM said it would invest $20 billion in EVs and AVs over the five-year period and in November, the company increased this amount to $27 billion. GM is targeting annual global electric vehicle sales of more than 1 million by 2025.
GM expects its results for the second quarter of 2021 to be better than what was initially expected despite impacts from the semiconductor shortage. The company expects adjusted EBIT for the first half of the year to range between $8.5-9.5 billion helped by factors such as strong demand and improved near-term production.
GM plans to speed up the production of its Ultium battery cells in the US by building two new manufacturing plants by mid-decade to complement the ones under construction in Tennessee and Ohio. The company has agreed to supply Ultium batteries and HYDROTEC fuel cells to Wabtec Corporation. It will also supply HYDROTEC to Navistar and Liebherr-Aerospace.
GM’s autonomous vehicle subsidiary Cruise will receive a multi-year, $5 billion credit facility to scale its Cruise Origin fleet. The production of the Cruise Origin will begin in early 2023.
Last month, GM’s rival Ford increased its electrification investment to over $30 billion by 2025. Ford expects 40% of its global vehicle volume to be fully electric by 2030.
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