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Charging a Chevrolet Bolt EV (display.)

GM, Honda Cancel Venture for ‘Affordable’ EVs

Oct. 26, 2023
The two automakers planned to produce 13 million entry-level electric vehicles starting in 2027, but now GM is focused on the Chevy Bolt and a “better driving, charging, and ownership experience” for buyers.

General Motors and Honda Motor Corp. will not jointly produce an “affordable” battery electric vehicle, as they announced in April 2022. The project comes to an end as the auto industry and its investors acknowledge growing concern that buyers are not enthusiastic about the forthcoming wave of new EV options, and wary about the list prices for such vehicles.

The now-scrapped plan would have seen a new series of compact crossover EVs jointly developed and based on GM’s Ultium battery technology, for sale in North America starting in 2027. The target for production volume was 13 million vehicles/year.

GM CEO Mary Barra told listeners to an earnings conference call that the automaker’s current emphasis is on the Chevrolet Bolt, a lower-cost EV that is already available.

“Our prior portfolio plans included several newly designed vehicles in the entry-level segments and a capital commitment of $5 billion over the next several years,” Barra said. “However, by leveraging the best attributes of today’s Bolt EUV as well as Ultium (EV battery technology) ... we will deliver an even better driving, charging, and ownership experience with a vehicle we know customers love.”

Recently GM announced it will delay the start of production for a line of all-electric trucks from 2024 to late 2025 – “to better manage capital investment while aligning with evolving EV demand. In addition, we have identified engineering improvements that we will implement to increase the profitability of our products,” according to the automaker’s October 17 announcement.

GM also has announced delays in production of three other EV models.

Some financial analysts contend that GM is revising its EV strategy due to the rising costs it is incurring from the ongoing United Auto Workers strike. However, major automakers’ outlook for EVs has grown more sober in recent months because of the cost of production of the new models, as well as consumers’ doubts about the cost of electric vehicles and the infrastructure to support them.

In confirming the end of their EV joint-venture, GM emphasized that the two companies are collaborating still on several other projects. Previously GM and Honda partnered to develop fuel-cell and hydrogen storage technologies (2013), and later Honda joined GM’s EV battery module development (2018.) In 2020, the two automakers launched the plan to codevelop electric SUVs, starting with the Honda Prologue to be launched in 2024, to be followed later by an Acura electric SUV.

Earlier this month, GM, Honda, and Cruise (an autonomous vehicle start-up) entered into a memorandum of understanding to establish a joint venture “driverless ridehail service” in Japan in 2026.

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