WARREN, Michigan — In her 11th year as CEO of General Motors Co., Mary Barra's latest test is to ensure that the Detroit automaker's coming electric vehicles reach profitability by getting mainstream consumers to buy them in competitive global markets.

But in the time since GM first declared it would become all-electric, industry regulations have changed and the pace in the demand for EVs has slowed. Even though EV sales surpassed 1 million for the first time in 2023, data shows they are slowing quarter to quarter. First-quarter EV sales rose 2.6% year over year, but fell 15.2% from the fourth quarter of 2023, according to Kelley Blue Book.

GM now plans to add plug-in hybrids to its North American lineup to meet federal regulations that take effect in 2027. The U.S. Environmental Protection Agency in March revealed its final auto emissions standards that give automakers more time to increase EV production. The rules don't require customers to buy EVs, but are a performance standard that allows automakers to determine their sales mix to comply with the greenhouse gas tailpipe emissions limits for light-duty vehicle fleets for model years 2027 to 2032 and beyond.

Barra, in an interview with The Detroit News last week, said the automaker now sees plug-in hybrids as part of the solution and expects them to arrive in North America in 2027.

GM isn't backing down on battery electric vehicles. Chevrolet has started delivering the mainstream Equinox EV and the retail version of the Silverado EV to dealer lots. GM will have more affordable trims of the Equinox, Blazer and Silverado EV in the second half of the year, which is also when Cadillac will expand its EV lineup with the Escalade IQ and Optiq. The automaker is aiming to build and wholesale between 200,000 and 300,000 Ultium EVs in North America in 2024.

Barra also talked to The News about GM's recent decision to downsize its Detroit headquarters by exiting the Renaissance Center, the automaker's charging partnership with Tesla Inc., its autonomous vehicle company, Cruise LLC, and many other topics.

Editor’s note: This interview has been edited for brevity and clarity.

Question: Do you think it's inevitable that Chinese EVs will come into the United States?

Answer: It's hard for me to to know and say. All I know is because I take every competitor seriously ... we've got to stay focused on being able to compete with anyone everywhere. And that's what we're focused on. We do have very strong brands. From a design perspective, getting a lot of very positive recognition on our designs, but then we've got to continue to really be relentless on taking cost out of our business because this is a very competitive business.

Q: You're downsizing a great deal going from the massive Renaissance Center to two floors in the Hudson. Why do that? Why have most folks based in Warren?

A: We haven't announced how many people will be or how many floors that we'll have, but it will be our true corporate headquarters and Detroit is our home. Once you have an opportunity to see the Hudson's space ... Dan Gilbert and his team have done a remarkable job, and I think it represents General Motors and it will be our true corporate headquarters. I'll be there along with the corporate staffs.

We had already made the shift a while back to have the sales and marketing team ... to be very close to the engineers and the designers who are making the vehicles. We get better collaboration but (that) also allows us to be faster, so that was something we had done a few years back.

When you look at the Renaissance Center, it's a prime location, when you think about it, on the riverfront and so that's why we're excited to work with Bedrock and with the state and with the mayor, to make sure we have a great outcome for what happens in that space. We're excited to be a part of that. ... I'm super excited about being able to be an anchor tenant at the Hudson's building.

Q: Are we really looking at a new concept of what a headquarters is?

A: We are reimagining what our headquarters will be. But we're very proud Detroit is our home and we've said that it will be our home. Look at the RenCen, I think it's close to 50 years old, if not a little over 50; the way work is done is very different, and to be in the pulse of Detroit is going to be very important in a very modern space. We'll also have collaboration space there for our teams, we'll have board meetings there, so it's going to be an important space.

Q: You came out of the gate full BEV. Do you think you made the wrong choice there?

A: We never expected the adoption of EVs to be linear. Several years ago we said it's going to depend on beautiful designs, the right range, the right technology, and the importance of the charging infrastructure, and then being the right price. I'm very proud of the Ultium-based EVs that we have that we're launching right now. We're seeing great success with the Lyriq, strong interest in many of the vehicles as they're coming out. Can't wait to get the Equinox out with some volume, as well as the Silverado EV, not only the work truck, but the retail RST version. We're well positioned, whether there's strong ICE (internal combustion engine) demand or strong EV demand because we've got really strong portfolios in both. For instance, Spring Hill (Manufacturing, in Tennessee), we have the opportunity to flex that plant between ICE and EV, so we can respond to the consumer.

Q: You've had some issues launching (EVs) and you have a lot of launches coming up here. Are you feeling like those issues are behind you now?

A: Absolutely. Last year, it really was starting brand new lines with a brand new supplier making (battery) modules. We're a company that has a deep manufacturing background, but I think in hindsight, we should've had more focus on doing something that was relatively new for us with the cells but it's behind us now, those lines have ramped, we're right on schedule to what we said we're going to be. It's not an issue now. As we move forward, we're going to build to demand. We now have the capability: Factory Zero (in Detroit-Hamtramck, Michigan) is up and running, Spring Hill is up and running, Ramos (in Mexico) is launching. With our EVs, we're going to make sure we don't overbuild and we manage our days supply because we think we've got desirable EVs, and we want to make sure we protect those vehicles from a pricing perspective, from a residual perspective, and not get into what's happened in other regions and frankly, in some cases here, of the markdowns because that really impacts your residual value and it hurts the brand over the long period.

Q: Talk to us about hybrids. When can we see them and what will they be?

A: We haven't announced specifically which ones but we've said in '27 and we do see that hybrids will be part of the solution. I think how long hybrids will be part of the solution depends on how quickly we get a robust charging infrastructure. We're working on that with many different groups, as well as our own investment. But hybrids will play a role. What has changed since we first said we're gonna go directly to EV is the regulations have changed, and plug-in hybrids are an important part of meeting the regulatory space and giving consumers more options, so as the regulatory space evolved, it made sense for us to assess our strategy. As we've said, we've got the technology. We're deploying it today in China. We actually had quite a few hybrids over the last several years, so we have the technology to pull on but as the environment changes, we're adapting to it.

Q: If you had to it all over again, would you have made hybrids a part of your suite of technologies earlier, so you'd have them today?

A: When you're making those decisions, you have limited capital to invest and you have limited engineering ... what I'm very proud of is that we have the Ultium platform; many people are now working on what is their dedicated EV platform, because then they're not going to have an EV that's got a compromise as it relates to range or performance. With Ultium, we can control that. If I had the decision to make over again, I think the choice we made to invest early starting in 2018 and having a dedicated EV platform that spans all the way from an Equinox to a super truck like the Hummer, I think is the right long-term strategy. In a world of constrained resources, I think we made the right call and from a regulatory perspective, when we get to '27, we're going to be well positioned with the hybrids that we will be rolling out.

Q: It was about a year ago when you made the commitment to provide the NACS adapters for consumers. Are you still on track with that?

A: Yes, we are. We have a well-thought-through plan that meets the commitments that we've made. It did change the port and we had to source that and do some design changes.

Q: Despite some of the headlines with Elon Musk laying off folks on the Tesla Supercharger team?

A: I can't explain what decisions he makes and why. We still are working with Tesla on that and understanding what the implications are, but let's remember that's only part of our strategy for charging. When we looked at the NACS, one of the things that we looked at was, what's the cost? What's the quality? What's the ergonomic design? And as we evaluated it against the SAE standard, we thought when you have something that's higher-quality, lower-cost and better for the consumer, it's a good choice to make ... but it's not our only strategy. Remember, we've got the Pilot Company work that we're doing. When you look at the bipartisan infrastructure bill, that money is now starting to flow to states. We've made investments and are doing chargers, partnering with our dealers in areas of community where they are best suited. One of the things we're really focused on right now is making sure not only do you have the charger but it works when you get there.

Q: You've talked a lot about Mike Abbott (former executive vice president of software), and he's now departed now from the company. How are you moving forward with software? You've had some challenges with the Cadillac Lyriq, Chevrolet Blazer EV. What's happening with that team now?

A: Mike is still an adviser to me. Mike came in and built a very strong team. We've opened our office in Mountain View (California) ... it's going to be very important that we have a significant space. We've been in Silicon Valley for a long time, whether it was with Cruise or we've even had OnStar and other resources there, but this is bringing them all together and leveraging the power of the organization that Mike has built. We've also changed the way we're developing software, and, more importantly, changed the way we're validating it. From a Blazer perspective, it was a handful of people that had issues but we took it very seriously. And so I'm very excited at the path we're on and in the short amount of time Mike was with us, as leading this organization, he revamped it and brought in the talent that we need to go forward, and they're all still here, and they're very committed to the mission. In this period, where we're determining who's going to replace Mike, I've been spending a lot of (time) with each of the individuals, both those who had been at GM for a while and those that were new to GM last year, and it's a very committed team doing phenomenal work. Many companies are struggling with software in the vehicle .... (with) the path we're on and the team Mike built, we're very well positioned.

Q: Was there a common thread with the software issues?

A: I don't think we had as robust a software development process, but then more important, I think what was very critical, is doing the right validation. One of the issues we also saw was chargers ... it wasn't as straightforward as everyone thought. We actually took vehicles out ... just literally take dozens of vehicles out on the road and just go to the four corners ... of the United States and see how they work. That allowed us to harden our software as it relates to charging because that was one of the bigger issues we learned. But then really important is having a robust software validation process, and that's what Mike has put in place. If we determine a vehicle isn't ready from a software perspective, like we did with the Blazer, we're going to hold it until it is, because we recognize ... there's a lot of new customers coming to General Motors for our EVs, and we want that experience to be very positive.

Q: Can you assess what the state of talent is in Michigan vs., say, in the Bay Area?

A: We're going to go to where the talent is because one of the things I've learned and it's really come to light in the software is our industry is so fierce, you have to have the very best talent. And it's not to say that our people aren't great, but if you haven't been a software engineer and doing the type of software that is needed, you don't have time to learn. You can bring some along, but you have to have the right leadership that knows exactly what they're doing. Bringing in the right talent, wherever they are, is going to be important. But let's remember, we've been a global company for a long time, so we've never had everybody on one campus. This is still where the core and the bulk of our talent are. Great engineers from schools across the country are here or in the center now that we're building in Silicon Valley. There is a lot of software talent there, and you have to you have to tap into that. But we also tap into software talent in Markham, Ontario.

Q: Are you concerned that the talent coming out and being produced by Michigan universities is really not competitive enough?

A: No, not at all. Michigan has to fix the public school system. When we think about the different challenges the world is facing, education is foundational, because when someone has a great education, they can do anything. When we're not serving the children in this state well with a solid, quality education, we put them at a disadvantage, but I would say when you look at our colleges that we have ... they do a fabulous job. We have to fix the core issue in K through 12. But I think our university system here is incredibly strong.

Q: Where are you in China? And is this company committed strategically to staying in China?

A: We think China is an important market, it has kind of stalled, but we still think there's growth opportunity. Clearly the industry has shifted with the rise of EVs, and frankly I don't think it's sustainable when you have over 100 EV startups, domestic Chinese companies, with only a couple of them profitable. There's got to be a sorting there. You can't have a race to the bottom. I think GM can play especially with the strength of our Cadillac brand and our Buick brand. I think in some cases we were later than we should have been to get the right portfolio of EVs there. We're launching an incredible amount of new energy vehicles, both hybrids and all-electric this year, so it's an important year for us. The market shifted; we've got to respond to that. There's been a growth of capability in the local OEMs that we respect, but I still think there's a place for General Motors and our brands to be successful there. But anytime you have a market that's got 100 new competitors, you're not going to maintain share.

Q: Do you still think there's a path to profitability with Cruise?

A: Absolutely. We are now very focused on building the right relationships with the local, state, federal regulators, as well as first responders as well as the community itself. In Phoenix, we went from manual to supervised and on the path to getting back to unsupervised autonomy. The other thing we learned and, I think we're seeing this broadly across the industry with technology, people have a higher expectation of technology than they do of other humans. Even though we demonstrated that Cruise was safer than an average human driver, I think people have a higher expectation. During this period since October, we've been working on strengthening the software and creating a gap between an average human driver and what Cruise technology is, so I do think autonomy ... is going to be a very important part of the future.

Q: How's your relationship with UAW President Shawn Fain?

A: The team continues to build it. ... I have a very constructive relationship with Shawn Fain. We don't always agree on everything, but we talk about it. We still have the regular meetings that we used to have in the past. And I think we're still getting to know each other. If you remember last year, he was named and then before it was a moment, we were in negotiations. I respect him. For our employees that are represented, they want job security, and they want to be compensated appropriately. And how do we do that in a way and make sure we're here for the long term because a lot of people that work in our manufacturing facilities are very rooted to the local community, and we respect that. And so we need to make sure we have a strong business to be able to have appropriate wages and to be able to provide that job security.

Q: Some of the competitors have talked about labor costs causing layoffs or moving investment elsewhere outside of the United States. Do you see that potentially having to happen?

A: One of the things I'm very proud of is as we started to craft our EV strategy ... we have very talented men and women who work in our manufacturing facilities and work really hard and safely build high-quality cars efficiently, we wanted to leverage that, that strength that we have. You've seen that we have allocated products and we're also leveraging the facilities in a lower investment. And so that was our plan before IRA, that was our plan before the union leadership changed, and we continue to do that. We recognize the strength we have and we want to convert and have the strength of our business to be able to keep all those facilities building great EVs for this country.

Q: How do you prepare for kind of a diametric outcome to this presidential election from a policy standpoint?

A: We're very much bipartisan. We work both sides of the aisle. A lot of the decisions we're making right now will be (affected by) the next administration. And so we have to be constructive. We have to make sure they understand different decisions and the impact that has on jobs in this country, because I think where we all are aligned, regardless of who's in office, regardless of what party, regardless of who's controlling the House or the Senate, is we want to protect good-paying jobs in this country and support a thriving and growing economy. And so we're going to continue to play our role and build the relationship and work with who's ever in office.

Q: If you've made such multibillion-dollar bets, and then you have another administration that basically turns everything 180 degrees, what happens to that bet?

A: I'm biased, but I think we have one of the strongest ICE portfolios we've had in General Motors' history along with a very strong EV portfolio, and we want to be customer driven. Even back, five, six, seven years ago, our goal was, "let's make EVs that are so great people want to buy them." It's not a regulatory or a policy issue, it's people buying what they want because it's great. And I think if we stay focused on just doing great EVs that people want, and we support the infrastructure from a charging perspective, I think consumers are very smart and very rational, and EVs are fun to drive.

Q: Any final thoughts?

A: This is a really exciting time. This is a once in a generational change. And what's significant is not just, switching to EV again, which I personally believe they're more fun to drive and there's a lot of benefits, but also, we're just in the early, early days of what we can do with software on vehicles to make the customer experience better. And then when you think about autonomy and the safety that provides. I started at 18 years old in 1980 as a college co-op student at General Motors. I think this is such an exciting time. We can just really change the way people move in such a positive way.

©2024 www.detroitnews.com. Visit at detroitnews.com. Distributed by Tribune Content Agency, LLC.