GM reveals it’s ramping up Chevy Bolt production as Tesla struggles to build the Model 3 (GM)

Chevrolet Bolt Orion Factory

  • GM CEO Mary Barra announced that the carmaker will increase Chevy Bolt production in 2018.
  • The all-electric vehicle has been an unexpected hit for the company.
  • Its closest challenger, the Tesla Model 3, is struggling to scale up to full mass-production.

The Chevy Bolt all-electric EV has been a surprise hit for General Motors. So much so that on Wednesday GM CEO Mary Barra said that the carmaker will increase production at the plant in Michigan that builds it.

Barra made the announcement in Houston at the CERAWeek energy conference, a yearly gathering of energy-industry professionals.

GM produces five electrified vehicles including the Bolt, and Barra said that drivers have thus far racked up more than 2.6 billion miles on the road.

“We are encouraged by this momentum, and because of increasing global demand for the Chevrolet Bolt EV, we are announcing today that we will increase Bolt EV production later this year at our Orion Assembly plant north of Detroit,” Barra said, according to a speech prepared for the CERAWeek event.

“Our more than 100 years of manufacturing expertise gives us the flexibility to scale production to meet market demand,” she added.

Chevy Bolt demand is steadily increasing 

Mary Barra

The Bolt saw steadily increasing monthly sales following its roll-out in limited markets in late 2016. The $37,500 vehicle (before federal and state tax credits are applied) has a range of nearly 240 per charge and has been viewed by many industry observers as a challenger to the Tesla Model 3.

Production slowdowns have plagued the Model 3, however. Tesla has officially delivered fewer than 3,000. It expected to be producing thousands per week by now, but the production ramp has been pushed off to mid-2018. 

Bolt saw a sales dip in January and February, but analysts expect the vehicle will rebound during the year. Informal estimates of Tesla Model 3 deliveries — Tesla doesn’t report monthly sales — suggest that the Model 3 has outpaced the Bolt in early 2018, but the Chevy is still the second-best-selling all-electric car in the market. In 2017, Chevy sold nearly 22,000 worldwide.

“Increased Bolt EV production benefits our customers around the world, our dealers and our employees, who are proud to build an affordable, ground-breaking vehicle that our customers love,” Barra said. “And there is more to come because the Bolt EV is our platform providing a window into our all-electric and self-driving future.”

GM is using Bolt to achieve its fully autonomous vehicle ambitions, by integrating the car’s assembly with technology developed by Cruise Automation, a San Francisco startup that GM acquired in 2016.

Flexing strategic muscles

cruise gm self-driving car

Strategically, GM is flexing its muscles here. It can dial Bolt production up or down quite easily based on demand. The carmaker evidently thinks demand for the car is robust.

Barra also addressed the federal tax-credit incentive, which will expire for GM once it sells a certain number of all-electric and hybrid-electric vehicles. 

“In the US the current federal tax credit helps make electric vehicles more desirable and affordable, and we appreciate that it was retained in the tax reform law,” she said. “However, we feel tax credits should be expanded so our customers continue to receive the benefit going forward.”

And she dealt with what many consider the biggest hurdle to widespread EV adoption: charging infrastructure. Tesla has invested in a large Supercharger network for fast charging, but other manufacturers have been reluctant to shoulder that burden.

“We need to remove barriers to consumer acceptance of EVs,” Barra said. “For example, we believe the energy industry and other stakeholders must partner with us on a robust charging infrastructure that drives consumers’ confidence that they can drive their EVs anywhere at any time.”

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