General Motors (GM) set a target to go all-electric by 2035, a milestone moment for the No. 1 U.S. automaker and the auto industry at large. GM stock rose.
XFor years, GM has signaled that it will eventually stop producing diesel- and gasoline-powered cars, trucks and SUVs. But Thursday marked the first time it has set a specific target date for going all-electric, a day after President Joe Biden signed a series of executive orders pushing a climate-friendly agenda.
"For General Motors, our most significant carbon impact comes from tailpipe emissions of the vehicles that we sell – in our case, it's 75%," GM CEO Mary Barra wrote on LinkedIn. "That is why it is so important that we accelerate toward a future in which every vehicle we sell is a zero-emissions vehicle."
The target, which GM described as aspirational, is both ambitious and risky. GM sold nearly 2.5 million vehicles in the U.S. last year, mostly gas-guzzling SUVs and trucks. That included more than 800,000 pickups.
GM's gas-fueled trucks and SUVS are key to its profits, while it's hard to make a profit on electric vehicles. But the auto giant is investing $27 billion in a bold bet on electric cars and autonomous vehicles, with 30 new EVs due by 2025. One of the first is an electric Hummer truck, due later this year.
Also, GM will use 100% renewable energy to power all its U.S. sites by 2030, the company added Thursday. It plans to achieve this same goal globally by 2035.
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GM Stock Rises
Shares gained 3.45% to 50.51.04 in Wednesday's stock market, rebounding from its 21-day exponential moving average. GM stock has pulled back from record highs but remains extended off a breakout past 46.81 from a cup base, according to MarketSmith chart analysis.
While Biden may have hastened General Motors' EV transition, auto giants have long been racing to catch up with Tesla (TSLA). Besides GM, Volkswagen (VWAGY), the world's no. 2 automaker by sales, plans to go all-electric. It has set a 2026 target date.
Several EV stocks, including Workhorse Group (WKHS), Lordstown Motors (RIDE), Hyliion (HYLN) and Nikola (NKLA), jumped Tuesday after the Biden administration announced plans to replace combustion vehicles in government fleets with electric vehicles.
And GM announced Wednesday it will supply fuel-cell "power cubes" to a Navistar electric vehicle.
Find Aparna Narayanan on Twitter at @IBD_Aparna.
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