General Motors has a logistics problem and the slow ramp-up of its battery cells manufacturing is constricting some production of new vehicles, including electric cars, CEO Mary Barra said.
In a wide-ranging interview Monday with NBC News President of Editorial Rebecca Blumenstein at the annual Aspen Ideas Festival in Colorado, Barra talked about those issues as well as topics such as GM’s return to the office policy and how it may adjust, the soon-to-come announcement of a new marketing director and what that will mean, hints at a future Chevrolet Bolt using the Ultium propulsion system and her regrets, including how GM idled Lordstown Assembly plant in 2019.
“We tried to do the right thing for the community,” Barra said of the Lordstown shutdown and transferring workers to other GM plants. “I’m responsible for a lot of jobs in this country especially good-paying manufacturing jobs and if I don’t make the right decisions to make sure our company is healthy and can compete in the future, I put a lot more jobs at risk.”
The Aspen Ideas Festival, which is in partnership with NBCUniversal News Group, is the gathering of leaders from various organizations around the world in a weeklong conference exchanging ideas, innovations and leadership lessons.
What’s the holdup in getting new EVs to market?
Last year, GM produced about 39,000 EVs, most of which were the existing Bolt and Bolt EUV rather than the newer model GMC Hummer pickup and Hummer SUV and Cadillac Lyriq EVs, which are on GM’s new Ultium propulsion system.
But Tesla made 1.4 million EVs. Barra said GM is working to catch up and will hit the production target to produce 400,000 EVs for North America between 2022 and the middle of next year. But ramping up a whole new propulsion system took time, as well as GM’s decision to self-source its battery cells and make them in the United States. GM partnered with LG Energy Solution in the joint venture Ultium Cells LLC.
“What’s held us off right now is getting our battery plants running,” Barra said. “We have a battery plant that’s running really well right now in Ohio.”
She is referring to the Ultium plant near Lordstown. She said construction to complete a battery plant in Spring Hill, Tennessee, and another in Lansing are on track. Earlier this month, GM announced it will build a fourth battery plant in New Carlisle, Indiana, near South Bend, with Samsung SDI.
“And getting those cells ramped up — that is constraining our Ultium platform vehicles, which is all of our future vehicles,” Barra said.
Those vehicles include the Chevrolet Silverado EV, along with the Hummer pickup and Hummer SUV and Cadillac Lyriq. All of those use the Ultium propulsion system. Also on that system is the Chevrolet Blazer EV and Equinox EV both out later this year.
“We’re ramping and we have some growing pains because it’s not only once you make the battery cells, then you gotta put it in modules and then you gotta make the pack for the cars,” Barra said. “It’s all new manufacturing, we’re working with different suppliers and I have people in suppliers trying to get it up and running.”
A big logistics problem
Barra said GM is working on supply chain resiliency and sourcing its materials in the United States to help get the parts it needs for vehicle assembly. But, as the Detroit Free Press first reported, the auto industry faces a big problem at the moment of getting transportation of its finished new cars from factories to dealerships because of a shortage of autorack rail cars.
“One of the biggest issues I have right now is logistics,” Barra said. “I have vehicles built that I can’t get on a truck or rail to get them to where it needs to go. So when you look at the logistics component, especially big components, you need to build them much closer to where you’re going to assemble them (new vehicles.)”
GM will catch up to Tesla in EV sales, Barra said
Barra told the crowd that she wishes GM had continued after launching the EV1 from 1996 to 1999 and “moved faster” on EV development. But she said GM is moving as fast as it can and EVs will comprise half of GM’s total sales in the United States by 2030.
“We sell more vehicles in the United States than anyone else,” Barra said. “We have the highest customer loyalty and just last week we have the highest quality. To get 30, 40, 50% of the population buying new (electric) vehicles you have to make sure it’s something that meets their needs.”
More:New study: 2 Detroit automakers rank for top quality, while Ford is below average
GM is doing that, she said, by offering EVs at various price points and offering reliable charging and service. Earlier this month, GM said it will collaborate with Tesla to share Tesla’s reliable, fast-charging network for GM EVs. She said GM is being “strategic” to offer EVs such as the Equinox EV, which is expected to start at about $30,000, and more pricey luxury models, too, such as the Hummer and Lyriq.
“We have made a commitment to be at 50% by 2030,” Barra said. “You gotta reach those customers. Our brand strength, the quality and loyalty we have — we’re on track to do it. What vehicles we have now and what we will have a year from now, will be dramatically different.”
Might the Bolt live on?
GM has said it will phase out production of the Bolt and Bolt EUV by the end of this year at its Orion Assembly plant in Orion Township so that the plant can start production of the Silverado EV pickup.
But Barra hinted there may be more to come with the Bolt.
“There is tremendous loyalty and equity in the Bolt,” she said. “It’s a very important vehicle … people will have to wait to see what we will do.”
Will GM restart advertising on Twitter?
In October Barra halted GM’s paid advertising on Twitter when Tesla CEO Elon Musk bought the social media site. Now that GM is partnered with Tesla on chargers, Barra is open to returning to paid advertising on Twitter.
“Very shortly we’ll be announcing a new marketing officer and as Twitter comes on board (with new leaders) there’s a conversation to be had,” Barra said.
In March, longtime GM Chief Marketing Officer Deborah Wahl retired and GM has been searching for a replacement.
Facing a high-level critic over the Lordstown closure
As part of a cost cutting measure, GM closed its Lordstown Assembly plant in 2019. Barra said it was the right thing to do because the Chevrolet Cruze subcompact car it built there was not selling. But she said GM “could have done a better job” in how it handled the situation.
“We did have jobs for everyone and I think we should have made that much more clear in the beginning,” Barra said. “They were not in Lordstown and I know it’s difficult to ask people to move, but GM did have good-paying jobs … and many people chose to move.”
Then-President Donald Trump used social media to come down hard on Barra for closing the plant. When asked what that was like, Barra said, “It feels pretty bad. When you have the president of the United States mad at you, it doesn’t feel good.”
GM felt a commitment to Lordstown, she said, and that was why it made the first Ultium Cells battery plant there.
Salaried workers returning to the office for more days?
After the COVID-19 pandemic, when most of GM’s salaried employees worked remotely, the automaker laid out a new philosophy in April 2021 called Work Appropriately. The idea didn’t quite work out as planned, Barra said.
“It said, ‘Be wherever you can do your best work’ and it slowly became ‘Be wherever I want to be’ and that wasn’t good for the business,” Barra said. “We have to do high-quality products on time and that’s the integration of some 30,000 parts so … we needed the people to be there — not all the time — but we asked for three days a week and we’re seeing that grow on a weekly basis.”
In September 2022 GM first presented the idea of returning to the office three days a week and met with some backlash. Barra said, “We had a vocal minority” on social media site Reddit who made comments that she read thinking, “Why do you work here? You’re obviously unhappy. So make other choices.”
More:Automakers’ new crisis: Some 70,000 new cars are stuck at factories amid rail car shortage
Barra said she has had positive feedback from some salaried employees that support being in the office and she hinted that more in-office time may be encouraged.
“With our voluntary separation program we just did, we’ll see where that leaves the company,” Barra said. “That will give us a better opportunity to see where we’re at and we’ll continue to message.”
Contact Jamie L. LaReau: jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.