General Motors Co. is raising its bet on electric cars by more than a third, as it hustles to convince a skeptical Wall Street that it too can be successful in the nascent market.
The nation’s biggest auto maker by sales said Thursday it would spend $27 billion through 2025 to develop electric and driverless vehicles. That is up from a $20 billion figure that GM pegged in March, days before the Covid-19 pandemic forced the industry to shut its North American factories and touched off an industrywide cash crisis.
Electric vehicles today account for only about 2% of global sales for GM and the broader industry. But with governments from Beijing to California seeking to clamp down on tailpipe emissions—along with the spectacular rise in valuations for green-car companies such as Tesla Inc. —traditional auto makers are racing for an inside edge in what investors see as the auto sector’s next big growth opportunity.
“We want to lead in this space,” GM product-development chief Doug Parks said during a media briefing. “Tesla’s got a good jump, and they’ve done great things. There’s a lot of startups, and everyone else invading the space.”
Speaking at a Barclays investor conference Thursday, GM Chief Executive Mary Barra said the company has the scale in areas like manufacturing and sales to eventually overtake Tesla as the leader in electric-vehicle sales in North America.