GM’s EV Production Retreat Leads To A $1.6 Billion Financial Hit - CleanTechnica

General Motors (GM) is taking a significant $1.6 billion financial charge due to scaling back its electric vehicle (EV) manufacturing capacity in the U.S. This decision stems from expectations of slower EV adoption caused by the termination of certain consumer tax incentives and reduced emissions regulation stringency. The charges include $1.2 billion in non-cash impairments related to capacity adjustments and $0.4 billion in cash-impacting costs such as contract cancellations and settlements. GM indicated that this reassessment of EV capacity and related investments, including battery component manufacturing, is ongoing. Despite previously achieving "variable cost positive" status—meaning EV sales covered direct costs like materials and labor—this metric likely deteriorated with subsidy changes and reduced production scale, making profitability more challenging. The market reacted positively to GM’s announcement, with its share price rising 2.75%, reflecting investor belief that scaling back EV production may improve financial outcomes. However, this raises questions about the future utilization of facilities built with substantial