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GM Could Very Soon Pull The Plug On Its Tesla Killer

The car manufacturer hasn't produced a single unit of the Bolt for months and there's no sign the production will resume soon.
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General Motors  (GM) - Get General Motors Company Report finds itself in a hot seat.

The Detroit giant is presented by President Joe Biden as leading the world in electric vehicles. But it hasn't really produced a fully electric car in the United States for several months. 

And above all, GM could very soon pull the plug on the Chevrolet Bolt, its mass-market electric car aimed to kill and compete with Tesla  (TSLA) - Get Tesla Inc Report Model 3. That's not, however, a sign that electric vehicles have become less important for the company.

The Detroit-based automaker is going to invest $4 billion to build electric versions of its best-selling pickups, the Chevy Silverado and GMC Sierra by 2024, in its plant in Orion Township, Mich., it announced on Tuesday.

If this is good news for the company and its ambitions in EVs, it nevertheless raises the question of what will become of the Bolt and the Bolt EUV, an SUV?  The Orion plant is the site where these two models were manufactured, though the production has been halted there for several months.

"Production of the Chevrolet Bolt EV and EUV will continue during the plant’s conversion", a spokesperson said in an email statement. He added that the Orion " Plant is down through February to continue prioritizing recall repairs."

GM has had only two fully electric models on the U.S market lately, the Chevy Bolt hatchback and utility vehicles, and both of which have been recalled due to battery fire risk. 

The company has halted production of those models while it works on replacing defective batteries in cars already sold, and last week confirmed it would keep the plant that makes these models idle for the rest of the year.

The Chevrolet Bolt.

Does It Make Sense to Produce The  Chevy Bolt ?

The numbers don't speak for the Bolt. 

Last year, GM only delivered 24,828 Chevrolet Bolt, up 19.6% compared to 2020. The end of the year was even disastrous for the Bolt whose design has evolved quite a bit: only 25 cars were sold in the fourth quarter, compared to 6,701 vehicles a year earlier.

Tesla sold more than 120,000 Model 3 in 2021.

However, the Bolt is much more than numbers. To pull the plug would be for GM to admit failure and above all to concede a crushing defeat against Tesla.

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Presented in 2016 as the car that would allow GM to catch up with Tesla in the electric vehicles market, the Bolt immediately won over the media. From headlines to awards, the car racked up accolades.

Motor Trend crowned it "Car of the Year 2017" because "Chevy changes the game. Again."

"The Groundbreaking Chevrolet Bolt EV Is The Car Of Tomorrow. Today," Motortrend praised. "The soft rustle of air over steel and glass, the muted hum of rubber on tarmac, the faint whirr of spinning metals. It's the sound of electrons at work, the sound of electrical energy being converted into motion, the sound of the automotive world shifting on its axis. It's the sound of the 2017 Motor Trend Car of the Year, the Chevrolet Bolt EV," the magazine wrote.

"This is a direct challenge for Tesla to make the Model 3 anything near the Bolt EV for the same price," executive editor Mark Rechtin said. "Chevrolet has made affordable long-range electric transportation available to the masses. Elon Musk should be afraid. Very, very afraid."

The newly redesigned Chevrolet Bolt has an estimated 259 miles of range. Its base price is $31,500. As for the Model 3, its minimalist design and massive touchscreen control center set trends for the rest of the EV market.  It has a 267 miles of range (Standard Range Plus) and 334 miles (Long range) for a base price of $40,690.

The Bolt EV is not GM's first pure electric car. 

The company has been experimenting with electric vehicles for decades, stuffing batteries into Corvairs in the mid-1960s and developing the complex EV-1 in the 1990s.  But the Bolt EV is the first conceived from the get-go by GM to be a viable, affordable mass-market electric vehicle. 

If Not The Bolt, What ?

GM has projected it will overtake Tesla as the top U.S.-based seller of electric vehicles by mid-decade. The company has pledged to invest $35 billion in EVs by 2025. By the end of 2025, GM to have more than 1 million units of electric vehicle capacity in North America

“We will have the products, the battery cell capacity and the vehicle-assembly capacity to be the EV leader by mid-decade,” GM CEO Mary Barra said in a statement. Adding, “We are building on the positive consumer response and reservations for our recent EV launches and debuts, including GMC HUMMER EV, Cadillac LYRIQ, Chevrolet Equinox EV and Chevrolet Silverado EV. Our plan creates the broadest EV portfolio of any automaker and further solidifies our path toward U.S. EV leadership by mid-decade.”

The company has teased upcoming new electric vehicles including a Chevrolet small SUV -- Equinox -- that will cost around $30,000, as well as electric trucks from Chevrolet and GMC -- Chevy Silverado, GMC Hummer, GMC Sierra --  SUVs from GMC, Buick, and luxury vehicles from Cadillac -- LyriQ, CelestiQ. 

The Chevrolet Silverado pickup truck could go up to 400 miles and will allow GM to compete toe-to-toe with old nemesis Ford  (F) - Get Ford Motor Company Report, with its F-150 Lightning. The F-150 Lighting has two batteries, one with a range of 230 miles per charge and the other over 300 miles.

By the end of the decade, GM expects $90 billion in additional annual revenue from electric vehicles, and $80 billion from connected vehicles, new businesses, autonomous ride-hailing, software and subscription services, and commercial electric vehicles. Annual revenue could be as high as $315 billion, the company said last October

"GM has changed the world before and we’re doing it again,” Barra emphasized.