The struggling battery factory behind GM's electric vehicle problems

Therefore, each time a cell’s tab misses its slot in the box, engineers have to go inside the fence, find the problem and come up with a solution. That’s a time-consuming and costly process, Anderson said.

The Detroit Fire Department says it’s been called nine times to Factory Zero since August. The most recent was on Dec. 19, when a stack of EV batteries started to burn after a forklift pierced battery packs. In other incidents, fire fighters were called to investigate battery gas leaks as a safety precaution, according to a GM spokesman.

“That’s more fires than anyone would want to see,” Anderson said. “It’s part of the growing pains.”

GM has brought in more battery experts, consultants and manufacturing executives to help fix the assembly problems. In February, the company hired former Tesla battery executive Kurt Kelty to run GM’s battery operations. JP Clausen, who led the rapid scaling of EV propulsion systems at Tesla’s factory in Nevada, was named GM’s new head of manufacturing last week.

Anderson said he thinks the company has “turned the corner” at Factory Zero and will continue to ramp up production en route to hitting GM’s latest production targets. The company will employ what it learned there to a new battery plant in Tennessee, scheduled to open later this year, and other future sites.

Software bugs have also delayed GM’s EV ambitions. The Chevy Blazer EV was on hold for almost three months due to issues with GM’s in-house infotainment software that is intended to replace Apple CarPlay and Google Android Auto. GM wants all vehicle software to be made in-house to better integrate it with the cars’ hardware. After testing the vehicles over thousands more miles, the company said March 8 that it had fixed the software and would cut prices on the Blazer EV as sales resume.

“They should be able to eventually solve the battery production problems, but GM is struggling to build the right organization to develop software,” said Sam Abuelsamid, an analyst with Guidehouse Insights. “At this point, you can’t take GM at their word with Ultium EVs.”

GM isn’t the only automaker struggling to accelerate EV production. Volkswagen AG also had buggy software in its cars. Wheels fell off Toyota Motor Corp.’s bZ4X. Ford Motor Co. last month halted production of its F-150 Lightning electric pickup due to quality issues.

The setbacks come at a difficult time for the industry when sales growth for electric cars is slowing globally due to high price tags and concerns about charging requirements. Manufacturing delays add further reputational risk for companies, especially among car shoppers considering buying an EV for the first time.

GM is hedging its bets on EVs with a simultaneous reintroduction of plug-in hybrids in North America, a business that it left five years when it discontinued the Chevy Volt.

“This is the Wild West,” said Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions. “Everyone is having a tough time.”

GM has a lot riding on EVs. Barra downsized GM’s global business — ceding turf to Toyota and Volkswagen — in order to invest in EVs and self-driving cars. She had an ambitious plan to double revenue to $280 billion by the end of the decade by transforming GM into a tech company.

The Cruise robotaxi business is in shambles after a pedestrian accident and alleged coverup in California forced the company to ground its entire fleet.

There are also federal government subsidies at stake. The Inflation Reduction Act gives money to automakers for building EVs that meet certain production requirements. GM says it stands to get $3,500 to $5,500 in tax credits for every EV it makes under the Biden administration’s policy. That equates as much as $1.65 billion if it reaches 300,000 EVs. The payments could balloon in coming years as the automaker aims to expand production capacity to 1 million EVs in 2026.

But GM fell well short of its goal of producing 150,000 EVs last year — half of which were to be Ultium-powered — and until recently had been targeting a cumulative total of 400,000 EVs by the middle of this year. Last year, most of its EV sales came from the now-discontinued Chevy Bolt. AutoForecast Solutions expects the company will only sell 112,000 battery-powered vehicles in 2024.

“Buyers just aren’t lining up for these vehicles,” Fiorani said. “If GM could make as many as they want, they might just end up competing on price with themselves.”

(With assistance from Gabrielle Coppola.)