GM’s EV Cost-Cutting Plan Goes Beyond Batteries, CEO Says

GM wants to introduce low-cost LMR and LFP batteries. But that's not the only way it's making EVs cheaper.

2027 Chevrolet Bolt

Photo by: Patrick George

Suvrat Kothari

By: Suvrat Kothari

Jan 27, at 10:47am ET

Add InsideEVs as a preferred source in Google

Comment

General Motors is looking for ways to reduce electric vehicle prices beyond just using cheaper batteries.
The automaker will introduce its next-generation software-defined vehicle in 2028.
Simpler electrical architectures and less wiring can help make future GM EVs more competitive.

General Motors is working to reduce the cost of its electric vehicles, beyond just using cheaper lithium-ion batteries, the automaker said Tuesday during its fourth quarter and full-year 2025 earnings call.

The update comes just as the automaker booked over $7 billion in charges related to cutting down its EV ambitions last year, which includes things like contract cancellation fees and converting its Orion, Michigan, EV assembly plant for the production of full-size gas trucks and SUVs.

Cost remains one of the biggest barriers to broader EV adoption. While more affordable models are finally on the horizon, most EVs sold in the U.S. today still cost more than comparable gas cars. Automakers have realized that demand is strongest at the lower end of the market, where the premium for going electric is often lower. As a result, the focus has shifted toward cutting costs in every possible way.

GM Forward Event 2025 -- LMR Batteries

GM's future lithium manganese rich batteries.

Photo by: Patrick George

While GM is on track to introduce cheaper battery chemistries such as lithium manganese rich (LMR) and lithium iron phosphate (LFP), it’s taking more steps to bring EV prices down.

“The investments we’re making now will be very much focused on cost reduction,” General Motors Chair and CEO Mary Barra said during the earnings call. “We have teams on each of our EVs to continue to take costs out beyond the battery,” Barra added.

Barra did not say where exactly those cost reductions would stem from, but one highly likely area is its upcoming software-defined vehicle platform.

“In 2028, we expect to launch our second-generation software design vehicle architecture for ice vehicles and EVs,” Barra said. “It will unite every major system from propulsion to infotainment and safety on a single, high-speed compute core.”

GM CEO Mary Barra at the 2024 Cadillac Celestiq reveal

Photo by: Cadillac

Legacy automakers are now following Tesla and Rivian to build software-defined vehicles. The key reasons for the pivot include the vast simplification of electrical architectures that SDVs can enable, with things like a reduction in the number of on-board electronic control units and cutting down the length of wiring harnesses to reduce weight and save costs.

Rivian, for instance, said last year that it was reducing the number of ECUs from 17 in its first-generation R1T and R1S models to just seven on the second-generation vehicles. That, paired with shaving off 1.6 miles of wiring harness, helped the carmaker shave off 44 pounds of weight, which all helps with overall costs and efficiency.

General Motors is likely heading down a similar direction. Its new SDV platform will launch on the Cadillac Escalade IQ in 2028, which will also include a new lidar sensor to enable Level 3, eyes-off and hands-off autonomy in certain driving conditions.

GM Ultium Platform

GM's Ultium EV platform.

At the same time, GM is aggressively pursuing lower-cost LMR and LFP battery chemistries. It said last year that LMR batteries will help its full-size trucks and SUVs achieve a driving range of over 400 miles at costs comparable to LFP batteries. Those models will launch sometime in 2028.

Plus, GM will introduce cheaper LFP batteries on the upcoming Chevy Bolt EV and a future trim of the Silverado EV. LFP batteries are extremely popular in China and are a key enabler of lower-priced EVs. GM has said that LFP batteries will allow cost reductions of around $6,000 per vehicle.

What do you think?

View

Comments

“We know EV drivers don’t often go back to ICE, so we’ll continue executing our plan to dramatically reduce cost and be well positioned for the future,” Barra said.

Contact the author: suvrat.kothari@insideevs.com