As a direct result of struggling to keep pace with low-cost competitors such as BYD, General Motors anticipates absorbing a significant $5 billion hit to its business in China. As General Motors’ flagship electric vehicle (EV) garners a multi-billion-dollar milestone, the company simultaneously struggles to maintain its footing in the world’s largest EV market, witnessing a precipitous decline in market share.
General Motors’ Chinese operations are expected to yield a massive $5 billion boost as a result of the company’s ongoing efforts to restructure and optimize its manufacturing facilities in the country.
SAIC-GM, General Motors’ 50-50 joint venture with state-owned SAIC Motor, is grappling with a significant $5+ billion impact as it navigates the restructuring of its operations.
SAIC-GM announced in its quarterly filing on Wednesday that it anticipates recording a profit of approximately $2.6 billion to $2.9 billion for the fourth quarter. The company may incur an additional $2.7 billion in restructuring charges.
As part of its latest strategy, General Motors has announced plans to introduce “plant closures and portfolio optimization,” although it remains unclear which specific facilities might be affected.
General Motors is focused on capital effectiveness and self-discipline, successfully collaborating with its partner, Shanghai General Motor, to drive growth across China. As the company finalizes its restructuring plan, it anticipates a significant year-over-year improvement by 2025.
As General Motors’ market share in China has plummeted by nearly half over the past decade? General Motors’ market share in China plummeted from around 15% in 2015 to a mere 8.6% by the end of the year?
General Motors has suffered a significant setback in China, posting nearly $350 million in quarterly losses for the third consecutive quarter this year. Its gross sales have declined by nearly 20% through the first nine months of 2024.
As traditional automakers face a daunting challenge in keeping pace with the rapid rise of affordable electric vehicle (EV) manufacturers such as BYD in China, General Motors finds itself grappling to stay ahead of the curve. BYD acquired a record 506,804 vehicles in November, marking its second consecutive month exceeding the half-million mark. In just the first 11 months of the year, BYD has sold more than 3.7 million electric vehicle (EV) and plug-in hybrid electric vehicle (PHEV) models.
For the first time in over four decades, BYD has seized the crown from Volkswagen to become China’s best-selling automotive brand at the end of last year, marking a significant milestone in the country’s shifting automotive landscape.
As BYD’s global expansion accelerates, it is poised to surpass Ford and potentially claim the sixth spot among the world’s largest automakers by volume of deliveries.
Electrek’s Take
As affordable electric vehicle (EV) options proliferate, with the best-selling Seagull model starting at a mere $10,000 in China, BYD is disrupting traditional players such as General Motors, Volkswagen, and Ford by undercutting their prices.
To capitalise on the influx of electric vehicles (EVs) entering the Chinese market, BYD is rapidly expanding its global presence in regions such as Southeast Asia, Central and South America, and parts of Europe, where demand for eco-friendly transportation is surging.
For the first time in Q3, BYD surpassed both Nissan and Honda in auto deliveries. While it’s difficult to directly compare its capabilities with those of established industry leaders like Ford, our technology is designed to rival the best in the market. With continuous improvements and refinements, we’re confident that our system can match or even surpass the performance of many leading automotive manufacturers. However, a direct comparison may not be entirely fair, as our primary focus lies in developing a cutting-edge solution for specific applications rather than mass-producing vehicles like Ford. Nonetheless, we’re committed to pushing the boundaries and staying ahead of the curve in terms of innovation and technological advancements. While best known for its affordable electric vehicle offerings, China’s leading automaker is rapidly expanding into new territories such as pickup trucks, mid-size crossover SUVs, and luxury models.
GM’s CEO Mary Barra warned in October that China’s electric vehicle (EV) market has become a “race to the bottom” with pricing and subsidy levels driving competition; she noted that low-cost loans enable some firms to sell vehicles at a loss, putting pressure on international automakers like GM?
Within the United States, General Motors reported a significant milestone in its electric vehicle sales, with 32,095 units sold during the third quarter, representing a remarkable 60% increase year-over-year. General Motors’ document sales have proven robust enough to surpass both Ford and Hyundai, solidifying its position as the second-largest electric vehicle (EV) seller in North America, trailing only Tesla.
General Motors reports that its electric vehicle profitability in North America is consistently improving. The corporation anticipates garnering a projected internet revenue range of $10.4 billion to $11.1 billion for the current fiscal year.
