General Motors (GM) has recently announced significant restructuring of its BrightDrop electric van subsidiary. These changes are forcing direct BAC cuts onto the CAMI assembly plan as well as temporary closing the CAMI assembly plant in Ingersoll, Ontario, Canada. The move, coming on the heels of disappointing sales performance and a revenue miss, was probably as inevitable as it was surprising. BrightDrop, a 100% owned subsidiary of GM, started in 2021. It was supposed to bring in $1 billion in revenue for 2023, but the company decided against disclosing its real numbers.
Per CNET, BrightDrop can’t be on track to meet its lofty $1 billion revenue projection. BrightDrop electric van sales have been lackluster so far, with less than 1,000 sold. They’ve only sold about 2,000 units combined in 2023 and 2024 so far. This has led many to question whether BrightDrop can become a strong, high-margin growth business for GM.
The CAMI assembly plant is reducing its operation from two shifts to one. This Amendment will result in the predicted loss of approximately 500 jobs. The idling period is scheduled to begin next month and last for approximately 20 weeks, into late October. In addition, battery pack assembly at the plant will halt on April 24 and April 28 to prepare for the extended shutdown.
An investigative story last week in the Detroit Free Press documented hundreds of BrightDrop vehicles accumulating in a company-owned storage yard in Flint, Michigan. Even more concerning is the degree of production challenges that the company is showing.
“This adjustment is directly related to responding to market demand and re-balancing inventory. Production of BrightDrop and EV battery assembly will remain at CAMI,” stated GM, highlighting their strategy to adapt to changing market conditions.
Industry watchers are sounding alarms that these moves, while positive in their own rights, may carry far-reaching implications for the North American EV landscape. Payne expressed concern regarding the competitive landscape, stating, “This is creating an opening for China and other foreign automakers to dominate the global EV market while the North America industry risks falling behind.”
“General Motors must do everything in its power to mitigate job loss during this downturn, and all levels of government must step up to support Canadian auto workers and Canadian-made products.”