General Motors, like any other automaker, is in the business of making money. And judging by the sales numbers posted in the second quarter, it’s going very well for the American auto giant–but that doesn’t mean it can’t be even better.
In Q2 2024, GM had its best quarterly U.S. sales since the fourth quarter of 2020, with a record number of EVs sold–roughly 22,000 units, up 40% year-over-year. So how does the company plan on offering the same package but make more money out of it? By cutting the number of components that make up a car, as GM CEO Mary Barra herself said during the carmaker’s Q2 earnings call with investors.
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Major redesign under the skin
It's unusual, but that's how General Motors rolls these days. During the second-quarter earnings call, GM CEO Mary Barra said that the 2025 Cadillac Lyriq has 24% fewer components than the 2024 model, which will hopefully lead to more money in the bank for the American automaker.
On the EV front, the Cadillac Lyriq, which is the fastest-growing EV in GM’s lineup, went through a massive parts-reduction diet to make it more competitive.
“On the 2025 Cadillac Lyriq alone, we’ve reduced the part count [by] 24% from the 2024 model year with no compromises to performance or features,” Barra said. “The list of parts or subsystems that we no longer need to design, engineer, source, install and warehouse is extensive. It includes complex and relatively costly seat assemblies, consoles, door trims and fascias,” GM’s CEO added. As a reminder, the 2025 Lyriq is expected to go on sale in the second half of the year.
Besides binning parts from one model year to the next, the automaker also resorted to fewer powertrain combinations. “A crucial element is reducing the number of buildable electrical combinations, which is delivering hardware and software quality improvement, as well as savings,” Barra said during the call.
Gallery: 2024 Cadillac Lyriq
But Cadillac's mid-size electric crossover isn’t the only GM product to go through a diet in the name of cost savings. “[T]hrough smarter contenting and optimizing selectable options, we have been able to eliminate more than 2,400 unique parts on 10 vehicles we’re launching through the first quarter of 2025,” the CEO said.
She's right. Cutting down on EV manufacturing costs is seen as key to boosting EV profits, especially when batteries continue to be the most expensive part of the car but buyers aren't willing to compromise on range. Rivian made headlines recently because it managed to cut no less than 1.6 miles of internal wiring on the 2025 R1 EVs compared to the outgoing models. Ford went down the same path of optimizing the way a car is built from one model year to another, all in the name of making more money and–hopefully–offering a better vehicle.
And it's a sea change for a "traditional" automaker like GM as well. Most usually stick with the original recipe for the whole of a model’s life with only minor mid-cycle tweaks, but newcomers like Tesla and Rivian have forced them to rethink how they’re doing things. Tesla is notorious for making multiple small changes to its cars in a single year. Maybe we can expect more of that from GM's EV game in the future too.
