General Motors (GM) announced on October 20, 2023, that it intends to produce hybrids in several different vehicle segments. Mary Barra, CEO of General Motors, noted during a conference call with analysts that gasoline prices in the United States have reached $4.28 per gallon, a significant increase from $3.04 last year.
Decline in General Motors Sales and Increased Demand for Hybrids
In the third quarter of this year, General Motors' sales in the United States reached 670,974 vehicles, which is 37,751 vehicles more than Toyota. However, General Motors' sales decreased by 6% compared to the same period last year. In contrast, Toyota's electric vehicle sales during this period increased by 28.5%. In response to a question from UBS analyst, Joe Spak, Barra said, "We will have hybrids," adding that more details will be provided closer to the launch date.
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Development of Hybrids and Its Impact on the Supply Chain
Barra also announced that General Motors is currently adding hybrids to its products in segments where it previously competes. She noted that most current hybrid activities are focused on compact cars, mid-size vehicles, and minivans, which General Motors is not currently present in. Barra also pointed out that these hybrids have "already been added" and will not require additional investment and engineering.
Considering the increase in diesel prices in the United States, Barra responded to a question from Alex Perry of Bank of America regarding the impact of this increase on the supply chain and heavy demand. She stated that "this increase in diesel prices is still early" and added that General Motors' diesels were more fuel-efficient than hybrid trucks even before this price increase.
The retail price of diesel in the United States has risen above $6 per gallon since September. According to surveys conducted in this area, it is estimated that about 56,000 households in the United States that were looking to purchase gasoline vehicles between February and May have instead purchased hybrids or electric vehicles. Of these, 38,000 households chose conventional hybrids and 18,000 households selected electric vehicles, primarily plug-in hybrids.
Toyota's electric vehicle sales during this quarter reached 363,367 units, accounting for 57.4% of the company's total sales. Additionally, Toyota's overall sales in the United States increased by 0.6% compared to last year, reaching 633,223 vehicles.
Barra also mentioned that with rising oil and fuel prices, the penetration of electric vehicles may increase, and General Motors wants to ensure it is prepared for these changes.
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