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GM’s 2Q22 Update, The CHIPs Act, and the Mid-Central Electric Valley

Thomas Paulson
Jul 29, 2022
GM’s 2Q22 Update, The CHIPs Act, and the Mid-Central Electric Valley

  • GM's 2Q22 update showed no consumer pushback to continued price increases. The company reiterated its 2H22 plans; namely, production levels are to increase, reflecting an easing of supply chain challenges and the semiconductor shortage. This increase is a bump from 1H22, but not a hockey stick that would increase dealer inventory levels sufficiently to bring consumer prices down.
  • GM CEO Mary Barra shared, "We are just weeks away from the launch of the 7-day operations at the first Ultium Cells JV plant in Ohio. Then each quarter, the plant will add 20% to its capacity, reaching the full 35 gigawatt per hour capacity in 4Q23. Securing cells from this plant are key to significantly ramping up production of the Hummer EV and the Cadillac Lyriq to beat pent-up demand. The second cell plant, which is under construction in Tennessee, is on track to open next year...In Lansing, Michigan, the site of the third cell plant…steel work will begin in August. And that plant opens in 2024. And the team is also making good progress towards selecting the site for the fourth U.S. cell, which will take our projected total battery capacity to 160 gigawatts...GM now has binding agreements securing all battery raw materials supporting our goal of 1 million units in annual capacity in North America in 2025." (For context, GM will produce 2.5M units total for the U.S. this year.)
  • Obviously, the passage of the CHIPs act is significant to the prospective reality of the Mid-Central Electric valley.

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Thomas Paulson

Director of Research and Business Development, Placer.ai

Thomas Paulson spent 20 years as a Wall Street analyst and a member of asset management teams at AllianceBernstein and Cornerstone Capital, representing top-50 ownership positions including Target, Home Depot, Nike, Amazon, Google, and many more.

He brings consumer related expertise and knowledge of enterprises in retail, CPG, financial services, telecom, and entertainment.

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