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GM CEO Barra says 'we are selling every truck we can build'

DETROIT — General Motors Chief Executive Mary Barra said on Monday the automaker is "selling every truck we can build" and expanding North American truck-building capacity, even as U.S. gasoline prices hit record highs. Barra made her comments during the automaker's annual shareholder meeting. GM is pursuing a two-track strategy: Investing heavily in electric vehicles for North America, China and other markets, and funding those investments by trying to maximize profits from its North American combustion pickup truck and large SUV lineups. Barra said GM is planning higher-priced versions of its Silverado large pickup and its large SUV models. GM and its Detroit rivals Ford Motor Co and Stellantis NV rely heavily on sales of large pickup trucks and SUVs for global profits. High U.S. gasoline prices in the past have undermined consumer demand for relatively inefficient models. Nominal pump prices hit an average of above $5 a gallon for the first time ever last week, the federal government said Friday. GM is ramping up production of EVs. Barra said the Cadillac Lyriq electric sport utility is sold out through 2023. In response to shareholder questions, Barra said the "clear priority" for using cash generated by its operations is to "accelerate our EV plans." She did not rule out share buybacks or other approaches to returning cash to shareholders. GM still expects to increase production this year by 25-30%, despite continuing pressure on semiconductor supplies globally. Barra said GM is working to redesign vehicles to reduce the number of processors required by 95%. Barra serves as GM's board chair and CEO. GM shareholders overwhelmingly rejected a proposal to separate those roles.

Luxury car brands scrambling to avoid a blue Christmas

DETROIT — When financial markets surge to new records, sales of luxury cars usually rise, too. Instead, October U.S. auto sales reports on Wednesday showed that a collapse in sales of luxury sedans is accelerating. Consumers have gradually shifted over to luxury sport utility vehicles from sedans in the past decade, but the trend — which has occurred in both the non-luxury and luxury sedan segments of the auto market — was particularly pronounced in October. Sales of Daimler AG's Mercedes-Benz S-Class, long a global benchmark for large, premium sedans, plunged 49 percent in October, and are down 24.8 percent for the year to date. General Motors' Cadillac brand said it sold just 779 of its CTS sedans in October. Demand for that car, designed to compete with German luxury sedans, is down nearly 33 percent for the year. "There's still a significant portion of the market that wants a car, but I'm sure there were people who preferred a horse to a car at one point." Cadillac's best-selling model this year is the XT5 compact SUV, which has more than doubled sales from a year ago. The shift within the luxury vehicle market away from sedans toward SUVs of all sizes is forcing some of the most prestigious brands to scramble to add SUV models to their lineups or boost SUV production to meet demand. "In the short term, there will be pressure to add (consumer) incentives, cut production or both," said Cox Automotive analyst Michelle Krebs. "And we just don't see an end in sight to this trend." The Dow Jones Industrial Average has been trading at all-time highs, usually a good sign for luxury sedans, but as major automakers reported new U.S. vehicle sales for October on Wednesday, sales for passenger cars continued their slide while luxury SUV and crossover sales rose again. According to Kelley Blue Book data, in 2007 luxury sedans made up 7.6 percent of U.S. new vehicle sales, while luxury SUVs made up 4.2 percent. Through September this year, luxury SUVs made up just over 7 percent of the market, compared with 4.9 percent for luxury sedans. In the short term, luxury brands could use holiday season sales promotions to clear slow-selling sedans off dealer lots, analysts said. Toyota's Lexus brand said on Wednesday it will launch its "December to Remember" year-end sales promotion for the 18th straight year.

GM to announce second U.S. battery plant, in Tennessee, with LG Chem, sources say

General Motors and South Korean joint-venture partner LG Chem will announce a second U.S. battery cell manufacturing plant on Friday, revealing plans for a $2.3 billion factory in Spring Hill, Tennessee, three people familiar with the matter said. The plant will use a different, more cost-effective battery chemistry than the one the companies will offer from the joint-venture plant they are building in Lordstown, Ohio, the sources said on Wednesday. The battery will be for the Cadillac Lyriq electric crossover vehicle that GM will begin building at its nearby Spring Hill assembly plant next year, the sources said. The timing of the Tennessee battery plant's opening is unclear, but there will be a period when the battery is supplied for the Lyriq by another LG facility until the Tennessee plant opens and it will not come from Lordstown, one of the sources said. GM would not confirm the details and declined further comment, and a spokesman for LG did not have an immediate comment. A Tennessee economic development spokeswoman also declined to comment. The No. 1 U.S. automaker previously said it was exploring the feasibility of another U.S. battery cell plant with LG's battery unit, LG Energy Solution, via its Ultium Cells LLC joint venture. Sources previously told Reuters that GM and LG Chem were in advanced talks with Tennessee officials, and that the plant there would be similar in scope to the $2.3 billion Lordstown plant. GM said in October it would invest $2 billion in Spring Hill to build EVs. The Detroit automaker said last year it was investing $27 billion in electric and autonomous vehicles over the next five years. Sources previously said GM would need more battery plants beyond the Tennessee one to meet aggressive EV targets. GM has set a target in January of halting sales of light-duty gasoline and diesel-powered vehicles by 2035. LG Energy said last month it planned to invest more than $4.5 billion in U.S. battery production over the next four years, including plans to build at least two new plants. LG had been embroiled in a high-profile dispute with rival South Korean firm SK Innovation in the United States after LG alleged SK stole trade secrets, but the companies settled that and other disputes with SK agreeing to pay $1.8 billion to LG. (Reporting by David Shepardson in Washington and Ben Klayman in Detroit; Editing by Matthew Lewis) Related Video: