General Motors is hitting the brakes on major parts of its electric vehicle strategy by pausing planned plant conversions and scaling back production at key U.S. facilities. The move reflects weakening demand for battery-powered vehicles and growing uncertainty around federal support for electrification.
At the heart of the shift are two major Ultium battery plants in Warren, Ohio, and Spring Hill, Tennessee. GM will halt battery cell production at both facilities beginning in early 2026 for about six months, and then resume operations at reduced capacity. The pauses come alongside temporary and permanent layoffs affecting thousands of workers.
The plants produce cells for GM’s proprietary Ultium platform, which underpins electric models such as the Chevrolet Silverado EV, GMC Hummer EV, GMC Sierra EV and Cadillac Escalade IQ. Together, the Ohio and Tennessee sites had been key pieces in GM’s broader strategy to scale EV production in the United States.
GM will also cut jobs at the EV assembly plant in Detroit known as Factory Zero. Starting in January 2026, the facility will operate just one shift instead of two, reducing output roughly by half. About 1,200 positions will be eliminated as part of that adjustment, with further layoffs tied to battery operations.
Industry analysts link the slowdown to softer consumer demand for electric vehicles after federal tax credits for EV purchases expired. U.S. EV sales, which had briefly topped 10 percent of total light-vehicle sales, are expected to weaken without the $7,500 incentive that previously helped spur purchases. GM itself has warned that near-term EV adoption “will be much lower than planned.”
Adding to the complexity, federal funding intended to help automakers retool existing plants for EV production has been delayed or put under review. Under the Domestic Manufacturing Auto Conversion Grants program, GM was set to receive support to convert facilities for electrification before the awards were stalled amid broader government review.
The impact of the slowdown extends beyond GM. Rivian and other EV makers have also announced layoffs this year as demand softens. The shifts are reverberating through supplier networks as well, with some partners postponing or abandoning plans to retool for e-mobility production.
Executives insist the company remains committed to electrification over the long term but acknowledge the market is evolving. GM says it will use the pause to upgrade facilities and remain flexible in how it aligns capacity with demand.
As 2026 unfolds, how quickly consumer demand recovers and how federal policy evolves will be central to whether this retraction becomes a temporary adjustment or signals a deeper recalibration of Detroit’s EV ambitions.
