GM Invests $4B in U.S. Plants, Shifts Focus Back to Gas Vehicles Amid EV Slowdown

General Motors (NYSE: GM) announced plans to invest $4 billion over the next two years in three U.S. facilities—located in Michigan, Kansas, and Tennessee—as it ramps up production of gas-powered vehicles in response to slowing electric vehicle (EV) demand.

Production of gas-powered full-size SUVs and light-duty pickup trucks will begin in early 2027 at GM’s Orion Assembly plant in Michigan, which was originally scheduled to build electric trucks starting next year. This strategic shift raises questions about GM’s previously announced goal to end gas vehicle production by 2035.

The decision was welcomed by the White House, aligning with President Donald Trump's push to strengthen domestic auto manufacturing. In March, GM CEO Mary Barra met with Trump to discuss easing federal fuel economy and California emissions rules. Trump is expected to sign legislation rolling back California’s 2035 zero-emission mandates.

GM’s Fairfax Assembly plant in Kansas will begin producing the all-electric Chevrolet Bolt later this year and will add the gas-powered Chevrolet Equinox by mid-2027. The company also announced future investments in affordable EVs at the Kansas facility.

Meanwhile, GM plans to invest $888 million to expand gas engine production at a New York propulsion plant. In Tennessee, the Spring Hill plant will start manufacturing the gas-powered Chevy Blazer in 2027, alongside EVs like the Cadillac Lyriq and Vistiq.

Despite the U.S. expansion, GM confirmed the Chevrolet Equinox and Blazer will continue production in Mexico to meet international demand. Mexico’s economy minister said there are no plans for layoffs or plant closures there.

GM expects annual capital spending between $10 billion and $12 billion through 2027, reflecting its adjusted strategy and increased U.S. investment.