The $7 billion that is to be invested in the United States as parts of contract talks with the United Auto Workers by General Motors Co will include an all-electric pickup truck and an advanced battery system.
The auto manufacturing giant and the trade workers’ union continued their talks to find a solution to end a strike that is being observed by 48,000 hourly workers of the company and has resulted in a complete breakdown in the US operations of GM which is highly profitable.
As a part of a deal in the negotiations, GM has pledged investments in eight facilities in four states without providing any specific time period, location and products that would be the focus of the investment apart from announcing production of electric pickup and a battery cell factory.
The company clarified its stand somewhat on Monday and said that investment in its core products such as trucks and utility vehicles that generate much of its profits, as well as in development of advanced propulsion systems for electric vehicles would be made by it.
Reports suggested that the production of electric vehicles in Michigan and battery cells in Ohio would receive some of the investments.
Reports quoting GM sources also said that upgrading factories in Michigan, Tennessee and Missouri for the manufacturing of redesigned variants of its midsize pickups and crossovers is also expected to be part of that investment.
It will invest in “additional new vehicle and propulsion programs,” The company said, but did not confirm anything about setting up new facilities.
“With as much excess capacity as GM still has, the company won’t be opening any new plants for the foreseeable future,” said AutoForecast Solutions Vice President Sam Fiorani.
GM had said previously that by 2023, it has plans of having in its portfolio a number of electric vehicles. No details however have been offered by the American auto giant on the issue till now. Reports however has suggested that an advanced battery system and a new vehicle structure that is flexible and modular so that different vehicle types and sizes can be accommodated would be included in those vehicles.
An average $8.45 billion a year on capital expenditures have been spent by GM over the past three years. Sources said that North America has been the target of most of those investments.
Over the four-year life of the proposed contract, the pledged $7 billion investment as announced by GM while negotiating with UAW works out to less than $2 billion a year.
A report by the news agency Reuters citing sources and published last month had claimed the plans of GM include the launching of a full-size electric pickup in 2022.
According to reports Monday quoting sources who had knowledge about the offer of GM to the UAW claimed that electric truck would be manufactured by the company at the Detroit-Hamtramck factory which currently has no future assignment. Sources also reportedly said that an electric vehicle battery plant near its shuttered assembly plant in Lordstown, Ohio, could also be built by GM.
(Adapted from Reuters.com)