GM expects EVs to generate $50 billion in revenue by 2025

That compares with global revenue of $127 billion for GM in 2021. Ford has said it generated nearly $40 billion from selling about 850,000 F-Series in North America last year.

GM said its EV profitability estimates do not include the impact of forthcoming federal tax credits.

“We actually estimate that these tax credits are going to be worth $3,500 to $5,500 per vehicle coming from GM through 2025,” GM CFO Paul Jacobson said at GM’s Investor Day last week. “Together, these credits could add 5 to 7 points of margin to the EVs, which puts us in a position where the tax credits are accelerating what we were already going to do and get our vehicles to ICE-like margins by 2025.”

Separately, GM believes it can save $2,000 per vehicle by expanding a digital retailing platform and shifting to a regional fulfillment model for EVs. The automaker already has opened two centralized EV fulfillment centers in California and one in the Southeast. The inventory management change is designed to speed vehicle delivery times — to as few as four days — and increase efficiency, which will reduce distribution costs, President Mark Reuss said during the investor event.

“The biggest enterprisewide cost savings will come as we and the dealers change how we handle inventory, which means we’re reducing how much we’re … incentivizing vehicles that were ordered that aren’t popular,” Reuss said. “At the same time, we’ll improve the customer experience by delivering the exact vehicles our customers want quickly and efficiently.”

The strategy leverages GM’s U.S. franchised dealership network for a competitive advantage, including over startups that sell EVs directly to consumers, Reuss said. Dealerships will continue to receive EVs for test drives and immediate delivery, but GM will hold additional EVs at the regional centers. GM has said the approach reduces floorplan costs and the likelihood that unpopular vehicles will sit on dealership lots.

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