General Motors (GM) has announced it will scale back production of several electric vehicle (EV) models, including the Cadillac Lyriq, Cadillac Vistiq, and the Chevrolet Bolt EV. The decision comes as the company anticipates a significant drop in demand following the expiration of the US$7,500 consumer tax credit for new EV purchases at the end of the month.
The credit has played a crucial role in boosting EV sales, helping to offset higher prices compared with petrol-powered vehicles. Without it, GM expects a slowdown in customer demand, despite recent growth in EV sales.
At its Spring Hill, Tennessee plant, GM will pause production of the Lyriq and Vistiq in December. The facility will also shut down for one week in both October and November, with further reductions planned during the first five months of 2026. During that period, the company intends to temporarily lay off one of its shifts of workers.
In addition, GM has indefinitely delayed the introduction of a second shift at its plant near Kansas City, which was due to begin manufacturing the Chevrolet Bolt EV later this year. The move signals a cautious approach to balancing production with anticipated demand once government incentives are no longer available.
EV sales show growth, but uncertainty remains
Despite the planned cutbacks, GM highlighted that August was its strongest month yet for EV sales. The company has seen a gradual improvement in adoption, though volumes have not reached earlier projections.
In its latest update, GM acknowledged uncertainty about future sales trends. Duncan Aldred, Senior Vice President and President, North America, wrote, “We will almost certainly see a smaller EV market for a while, and we won’t overproduce.” His comments reflect the company’s intention to align output closely with market conditions rather than risk oversupply.
The planned production changes suggest that while GM recognises the growing popularity of EVs, it is also preparing for a more challenging period as financial incentives disappear.
Industry concerns over US clean energy investment
The decision by GM has raised broader questions about the future of EV adoption in the United States. Industry observers have long warned that the country risks falling behind other nations in the transition to clean energy.
In May, transportation editor Andrew J. Hawkins noted, “the US was already woefully behind China and other developed nations in terms of clean energy investments. And now it’s likely to fall even further behind, perhaps permanently so.”
With America’s largest car manufacturer reducing EV production even as sales reach new highs, analysts fear the US could struggle to keep pace with international competitors. China, in particular, has rapidly expanded its EV market with strong government backing, while European nations continue to implement policies that support cleaner transport options.
As the US approaches the end of the tax credit scheme, the coming months will be crucial in determining whether momentum in the EV market can be sustained without federal subsidies. GM’s decision highlights the delicate balance between encouraging innovation and responding to immediate market pressures.
