GM says its EVs are now “profit positive”

• Not counting some long-term costs, GM EVs became profitable in Q4
• High-priced Cadillac Escalade IQ and GMC Sierra EV models contribute to that
• 2024 GM EV sales summed about 189,000 for the year; GM targets 300,000 in 2025

General Motors claims that, by at least one metric, its electric vehicles achieved profitability in the fourth quarter of 2024. It’s an indication that the automaker is putting the early struggles of its EV ramp-up behind it.

GM announced its 2024 financial results Tuesday, and one of the nuggets from that announcement was a claim that EVs were “variable profit positive” in Q4. This refers to EV revenue being higher than fixed costs like labor and materials, but does not include other related costs like building new assembly lines, Reuters noted.

In a quarterly and annual update for shareholders, GM CFO Paul Jacobson reported that it achieved that “variable profit positive” status on its EVs in the fourth quarter through higher production and improved material cost, including lower cell cost. He also cited the launch of the Cadillac Escalade IQ and GMC Sierra EV—two EVs with especially high sticker prices.

GM also narrowly missed a goal of manufacturing 200,000 EVs for the North American market in 2024, coming in at around 189,000. That number represented a doubling of its EV market share versus 2023.

Further, inventory fell from a 100-day supply at the end of Q3 to 70 days at the end of Q4. That’s still higher than the 53 days GM’s gasoline and diesel vehicles averaged, but moving in the right direction to sync supply and demand, as less time spent on dealer lots is an important industry metric for that.

The automaker is aiming to make 300,000 EVs for North America in 2025 with further improvements in their financial outlook, aided by the continued scaling up of production, absorption of more of the fixed costs behind the EV ramp-up, and further cost reductions on a per-vehicle basis.

While mixed, these results still contrast the outlook last July, when GM CEO Mary Barra confirmed that the automaker was backing away from a target of production capacity for a million EVs by 2025, claiming the EV market was “not developing.” But GM saw EV sales steadily rise in each quarter of last year, from approximately 16,000 in Q1 to just under 44,000 in Q4. It also reported a growth in U.S. EV market share from 6.5% in Q1 to 12.5% in Q4.

The one-million EV goal is still a long way off as GM continues to recover from a slow start. It struggled to accelerate EV production in 2023, due mostly to issues ramping up its battery cells. It then missed a goal of delivering 400,000 EVs, cumulatively from 2022, in the first half of 2024. That goal itself had been pushed back from 2023.