GM stops BrightDrop production as EV interest dims

General Motors announced on Oct. 21 that the automaker is ending production of the BrightDrop electric delivery van, part of an overall push to reduce EV capacity. Waning interest in zero-emission vehicles (outside of California) and the elimination of the federal EV tax credit on Sept. 30 have tamped down sales across the country.

 

The BrightDrop was built at the CAMI plant in southern Ontario, Canada. FedEx implemented 150 BrightDrop Zevo 600s into its parcel pickup-and-delivery fleet in June, and had planned on eventually incorporating 2,500 as a plan to make its PUD fleet all electric by 2040.

 

“The commercial electric van market has been developing much slower than expected and changes to the regulatory framework and fleet incentives have made the business even more challenging,” GM Chairman and CEO Mary Barra said on a conference call with analysts. “By acting swiftly and decisively to address overcapacity, we expect to reduce EV losses in 2026 and beyond, making us much better positioned as demand stabilizes.”

 

GM did however report better-than-expected third-quarter results. The OEM generated revenues of $48.6 billion in Q3, which was down slightly from the same time in 2024, and net income fell to about $1.3 billion from $3.1 billion. Adjusted for the $1.6 billion charge and other items, earnings before interest and taxes came in at $3.4 billion compared to $4.1 billion.

The company delivered about 1.56 million vehicles globally during the quarter, up about 6% year over year. North American deliveries also rose roughly that much to 837,000, which pushed GM’s market share to 16.1% from 15.8%. (It was slightly higher in the first half of the year.)

 

Jacobson told investors and analysts that tariffs hit GM’s numbers to the tune of $1.1 billion during the third quarter, which is slightly less than expected because of lower imports from Korea. For the full year, tariffs are now expected to cost GM between $3.5 billion and $4.5 billion, a reduction of $500 million from executives’ summer forecast. The Trump administration’s announcement last week of a rebate program for vehicles assembled in the United States but using imported parts will reduce that figure in 2026, Jacobson added.

 

Barra said that EVs remain the company’s “North Star” for the long term. She added the company ranks second to Tesla in U.S. market share and will continue to build the electric Chevrolet Equinox and Cadillac Escalade IQ, among other models.

 

Chevy is also expanding the Silverado EV to include a Trail Boss version, which we recently reviewed.

 

CFO Paul Jacobson told analysts that, after large investments in EV capacity and technology marked the first half of this decade, “the next few years are going to be about lowering the cost and making structural improvements to the battery cells and to the architecture.” EV sales have dropped off significantly this month, he added, and likely won’t stabilize—and begin to accurately reflect longer-term demand—until early next year.

 

That means GM is likely to continue to trim production capacity for both its vehicles and batteries. (The company this spring sold its share of a joint venture battery cell plant in Michigan to LG Energy Solution for about $2 billion.) And Jacobson said his team doesn’t want to do that in small steps, a strategy he said “really wreaks havoc” on GM’s suppliers and logistics partners.

 

“We need to make sure that we rightsize the capacity footprint to be able to not have to absorb a lot of those fixed costs,” Jacobson said. “So while it’s unfortunate, I think it is a quick adjustment to the reality around us that we’re facing.”

 

The reported results and earnings-call commentary gave a big lift to GM shares (Ticker: GM). Heading into the close of regular trading Oct. 21, they were up 15% to about $66.70, their highest level since the company emerged from bankruptcy in the wake of the Great Recession. The company’s market capitalization now is about $64 billion.