GM cuts Bolt EV production plan as tax credit loss looms

General Motors Co. will start the launch of the Chevrolet Bolt electric vehicle in December with one shift at its plant in Kansas, less than the two shifts initially planned for the plug-in compact due to uncertain EV demand, the company said.

GM is bracing for the Sept. 30 expiration of the $7,500 consumer tax credit for EV purchases that President Donald Trump and the Republican-controlled Congress have cut. The loss of the tax credits could undermine EV sales, so GM is cutting production of the Bolt and two Cadillac EVs until the automaker can measure the impact.

"General Motors is making strategic production adjustments in alignment with expected slower EV industry growth and customer demand," the company said in a statement. 

The company will also take downtime in December at its Spring Hill, Tennessee, assembly plant, where it builds the Cadillac Lyriq and Vistiq EVs alongside gasoline-powered Cadillac SUVs, the company said. GM plans to cut output to one shift from January through May.

Reducing EV production is another setback for GM Chief Executive Officer Mary Barra's push to quickly grow EV sales. She had once set a goal of going all electric by 2035, a target which the company has since walked back.

The production cuts come even as GM reported a record of more than 21,000 EV sales in August as consumers rush to cash in on the federal purchase incentives before they disappear. GM said it sold 8,500 Mexico-made Chevrolet Equinox EVs and the Cadillac Optiq and Vistiq EVs also had record sales, a spokesman said in an email.

Duncan Aldred, president of GM's North America business, said the company expects EV sales to fall after the federal incentives end and could normalize months later. GM will not overproduce until the automaker has a read on the market, he said in a Sept. 3 statement.

"We believe GM can continue to grow EV market share," Aldred wrote. "We are seeing marginal competitors dramatically scale back their products and plans, which should end much of the overproduction and irrational discounts we've seen in the marketplace."

GM stopped producing the previous Chevy Bolt in late 2023. That version was based on a previous generation battery pack which caught fire in rare instances, leading GM to recall every one of the vehicles it sold to find a preventative fix.

Trump's $3.4 trillion fiscal package has not only cut sales incentives, but also eliminated fines for automakers who miss federal fuel economy targets. That move also reduces the incentives for automakers to sell EVs, which generate credits to meet those targets.

While GM is reducing production of EVs, the company announced in June it will boost production of large pickups and SUVs at a plant in suburban Detroit in 2027.