GM looks to cut EV costs while searching for profit from green vehicles

investing.com:

General Motors (NYSE:GM) announced Thursday that the Detroit automaker expects substantial decreases in electric vehicle manufacturing expenses by 2024 while simultaneously ramping up the production of more lucrative vehicle models.

During a Barclays event, GM's Chief Financial Officer, Paul Jacobson, expressed confidence in the company's upcoming enhancements in EV profit margins.

He outlined projections for an upturn in margins next year, foreseeing the achievement of mid-single-digit earnings before interest and taxes margin goals by 2025.

«We don't want to be the next Tesla. We want to be the best GM that we can be,» said Jacobson.

Just a day prior to his remarks, GM implemented several measures aimed at reassuring investors. The automaker’s actions included the announcement of $10 billion in fresh share buybacks, a notable 33% increase in dividends, and a commitment to significantly reducing expenditures within its autonomous vehicle division, Cruise.

In line with its commitment to cease the sale of gas-powered vehicles by 2035, GM had previously stated its intention to produce 400,000 EVs from 2022 until mid-2024. However, the company recently retracted this goal.

Jacobson said Thursday that GM would see a «meaningful» EV production hike next year. «We do still expect to have 1 million units of (EV) capacity by 2025,» he said.

Jacobson highlighted GM's strategic plans to achieve a reduction of fixed costs in 2024 for EVs, targeting an approximate $20,000 decrease per vehicle compared to 2023.

In determining the profitability of its EVs, GM factors in battery production tax credits and the advantages stemming from reduced greenhouse gas emissions.

Furthermore, GM anticipates a shift towards manufacturing more