General Motors (GM) is ramping up production of internal combustion engine (ICE) transmissions at its Toledo, Ohio, plant, scaling back its prior push into electric vehicle (EV) drive units amid changing market demand, the company confirmed Wednesday.
The move reverses GM’s earlier plans to transform the facility into a key hub for EV drive units. While the automaker had pledged $760 million to convert the plant, it has yet to produce any retail EV drive units at the site.
“To align with current market demand and manufacturing needs, leadership has made the decision to add capacity to support propulsion units currently built at Toledo for ICE products,” said Rob Morris, the Toledo plant director, in a memo to employees. One of the plant’s drive unit production lines will now be converted into a transmission line. However, there has been no update regarding the plant’s second drive unit line.
The shift will support increased output at GM’s Fort Wayne, Indiana, assembly plant, which builds light-duty trucks. GM previously announced production expansion at Fort Wayne following President Donald Trump’s move to impose 25% tariffs on auto imports earlier this month.
Despite the timing, a GM spokesperson said the decision to pivot back to ICE components in Toledo is not related to the new tariffs.
Nonetheless, GM is not alone in reconsidering its EV timelines. The automaker recently delayed EV truck production at its Orion Assembly plant in Michigan and missed its target to wholesale 200,000 EVs in North America in 2024, falling short of 189,000 units.
Meanwhile, Trump’s auto tariffs are already prompting broader industry shifts. A report from the Center for Automotive Research estimates the new 25% tariff will raise U.S. automaker costs by $108 billion in 2025.
Starting May 3, the government will implement new duties on imported auto parts, which will further strain the industry’s supply chains and investment strategies.
