GM just made its largest investment ever in gas-powered engine production guaranteeing that it will be producing full- sized trucks and SUVs for years to come. The automaker is investing $888 million in the Tonawanda Propulsion plant in Buffalo, NY, to build the next generation of V-8 engines. GM had planned to build electric drivetrains there but is now steering back to more conventional engines, as demand for EVs has slowed. The new V-8s will be used in Chevrolet Silverados, GMC Sierras, Cadillac Escalades, Chevrolet Tahoes, Suburbans and GMC Yukons. The company is already retooling a Flint engine plant to build the same engine, showing that GM believes the future demand is for ICE vehicles not EVs.
“Our significant investments in GM’s Tonawanda Propulsion plant show our commitment to strengthening American manufacturing and supporting jobs in the U.S.,” said Mary Barra, Chair and CEO. “GM's Buffalo plant has been in operation for 87 years and is continuing to innovate the engines we build there to make them more fuel efficient and higher performing, which will help us deliver world-class trucks and SUVs to our customers for years to come.”
GM’s Huge Investment
GM has previously indicated that it would shift to all electric vehicles by 2035, but it appears that the slowing EV adoption rate has shown the automaker that is unrealistic. Profits from full-size trucks and SUVs have kept the company afloat as it invested in EV production. Chevrolet’s Silverado 1500 pickup and Tahoe SUV are huge moneymakers. While the Ford F-Series is the nation’s top selling brand, the Chevrolet Silverado often outsells the Ford F-150. The Chevrolet Tahoe is the top-selling full-size SUV and the Cadillac Escalade has been the top-selling full-size luxury SUV for years. This GM investment shows that those vehicles will stay in production indefinitely. A company doesn’t invest nearly a billion unless it is meant to be long term. The investment includes new machinery, equipment, and tools, as well as facility renovations.
“This investment marks an exciting new chapter for our plant,” said Tara Wasik, plant director at Tonawanda. “For generations, our team has demonstrated its commitment to manufacturing excellence. We are grateful for the opportunity to continue supporting the Western New York community and steadfast in our mission to deliver world-class propulsion systems to our customers.”
Currently, Tonawanda builds the fifth generation of V-8 engines. As I previously reported, GM is recalling more than 700,000 vehicles because of potential problems with that engine. The plant needs to keep producing new versions of that engine because GM needs them to replace the faulty ones. The plant will be producing the new sixth generation of engines by 2027.
Steering Away From EV Production
Back in 2023, GM committed to a $300 million investment for drive unit production at the Tonawanda plant. Apparently, that switchover never started because the plant still is producing the fifth generation of V-8s.
According to GM, the new generation of engines is expected to deliver stronger performance than today's engines with better fuel economy and fewer emissions. “New combustion and thermal management innovations are a key factor driving these improvements.”
The bottom line is that GM is changing or at least slowing its push to go all electric. GM lobbied congress to stop California’s strict EV mandates. Consumers either aren’t convinced or can’t afford to switch to EVs. Whatever the reason, consumers will continue to be able to buy full-size gas-powered trucks and SUVs for at least the next decade, if not longer.
Chevrolet Photo
Mary Conway is a professional automotive journalist and has decades of experience specializing in automotive news analysis. She covered the Detroit Three for more than twenty years for the ABC affiliate, in Detroit. Her affection for the Motor City comes naturally. Her father ran a gas station while Mary was growing up, in Wisconsin.
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