Elgin Area Chamber Of Commerce: GM Accelerates Factory Investment, Computer Chip Troubles Remain, Consumer Confidence Drops

Elgin IL

27 January, 2022

2:31 AM

Description

Press release from the Elgin Area Chamber of Commerce: January 26, 2022 GM Accelerates Factory Investment General Motors is accelerating its plan to overtake the lead from Tesla and Ford in electric vehicles by investing nearly $7 billion on Michigan factories to produce EVs and batteries. The Detroit automaker said in its Tuesday announcement that the investment is the single largest in the company's history and \will add 4,000 new jobs. Most of the investment will be in its Orion Assembly plant in Orion Township where the company is spending $4 billion to immediately begin converting a facility to assemble electric Chevrolet Silverados and GMC Sierras. The company already has been converting or building EV plants in Detroit and Spring Hill, Tennessee, south of Nashville. GM through its joint venture with LG Energy Solutions named Ultium Cells will invest $2.6 billion on a new battery plant in Lansing, the third such plant in the country for the venture. Tesla reported in early January that it had a record year of EV deliveries in 2021 with 936,172. Ford's sales of the EV Mustang have been increasing and it is doubling production capacity of its EV F-150, which garnered 200,000 reservations. Computer Chip Troubles Remain A Commerce Department survey of companies found that the supply of key semiconductors is perilously low as the Biden administration urges Congress to pass legislation that includes billions of dollars to boost domestic computer chip production. The report found that the supply is down to five days compared to 40 days in 2019. U.S. manufacturing already has felt the effects of the pandemic disruption, with automakers having to throttle back production. "With sky-rocketing demand and full utilization of existing manufacturing facilities, it's clear the only solution to solve this crisis in the long-term is to rebuild our domestic manufacturing capabilities," Commerce Secretary Gina Raimondao said in a statement. Legislation in Congress would put $52 billion in funding in place for research and development and production. Patrick Gelsinger, Intel's CEO, made the case for passing the legislation last Friday while standing with President Biden at the White House and announcing Intel's two chip factories in Ohio with a $20 billion investment. Consumer Confidence Drops Consumer confidence fell off some in January after three consecutive months of increases but remains strong while concerns over inflation lessen. The Conference Board's index fell from 115.2 in December to 113.8. Consumers had a more optimistic view about their present situation but their expectations about the next six months were more pessimistic. Still, Lynn Franco, senior director of economic indicators at The Conference Board, said in a statement that the "proportion of consumers planning to purchase homes, automobiles, and major appliances over the next six months all increased." For the second month, however, inflation concerns fell although they still remain high after hitting a 13-year record in November. This press release was produced by the Elgin Area Chamber of Commerce. The views expressed here are the author's own.