GM slows EV production as tax credit nears expiration
- General Motors (GM) plans to slow down electric vehicle (EV) production due to the impending expiration of the $7,500 consumer tax credit for EVs at the end of the month.
- GM will pause production on the Cadillac Lyriq and Vistiq, as well as the Chevy Bolt EV, starting in December, with temporary layoffs and reduced shifts planned for 2026.
- The company expects a “smaller EV market” for a while, citing uncertainty about future demand, according to Senior Vice President and President of North America Duncan Aldred.
- Despite recent improvements in EV sales, including August being the best month on record, GM is taking a cautious approach to avoid overproduction.
- The US is likely to fall further behind other developed nations in clean energy investments, with GM’s production cuts exacerbating the issue, according to transportation editor Andrew J. Hawkins.
General Motors is going to be scaling back production of the Cadillac Lyriq and Vistiq, as well as the Chevy Bolt EV as it expects sales of electric vehicles to slow dramatically. The $7,500 consumer tax credit for purchasing a new EV is set to expire at the end of the month. That credit has been crucial to driving demand for EVs, which are still more expensive than their gas-powered counterparts.
The company is pausing production on the Lyriq and Vistiq at its Spring Hill, Tennessee plant in December. It’s also planning to halt manufacturing for a week in November and October, as well as slow production during the first five months of 2026 by temporarily laying off one of its shifts of workers. Similarly, it’s indefinitely delaying the start of a second shift at a plant near Kansas City, which is supposed to begin producing the Chevy Bolt EV later this year.
While EV sales have struggled to meet expectations, they have improved over time. GM even announced that August was its best month on record for EV sales. But in the same press release it was quick to note that it was unsure what the future would hold. “We will almost certainly see a smaller EV market for a while, and we won’t overproduce,” the company’s Senior Vice President and President, North America, Duncan Aldred, wrote.
Back in May, transportation editor Andrew J. Hawkins said, “the US was already woefully behind China and other developed nations in terms of clean energy investments. And now it’s likely to fall even further behind, perhaps permanently so.” When the largest American automaker is aggressively slashing EV production, even as sales surge, it’s hard to see how the US can catch up.