© Reuters General Motors (GM) Barra believes GM EVs will be profitable by 2025
By Michael Elkins
Shares of General Motors (NYSE:) are up 2.21% in mid-day trading on Tuesday, ahead of the company’s November 17th investor day, where CEO Mary Barra plans to tell investors that the company expects its electric-vehicle program to be profitable in 2025.
Mary Barra said on the company’s 3Q earnings call, this week’s investor update will “go deeper into the second phase of our EV growth strategy.”
During investor day, Barra is expected to outline the company’s plan to show how the automaker can cover investments for battery plants and assembly and build the Ultium battery program’s margins. Also happening at the investor day, according to people who asked not to be named, executives plan to detail GM’s push to go from selling just about 44,000 EVs this year in the US to profitably becoming one of the nation’s biggest EV producers.
During GM’s 3Q, reached a record $41.9 billion. However, its margins were much lower, and even more so with its electric vehicles. GM posted automotive revenue of $38.7 billion, yet the cost to make and sell these vehicles reached $35.6 billion, for a gross profit of $3.1 billion or just over 8%.
As GM scales EV production, the company expects to continue taking a loss in that segment. However, Barra is confident that 2025, the same year GM is targeting sales of 1 million battery powered vehicles, will likely be the year GM will make electric vehicles for a profit.