General Motors Races To Decouple Supply Chain From China: Report

• To some suppliers, the carmaker has set a deadline of 2027 to remove their China sourcing ties, the report said. 
• While GM approached some suppliers with the directive in 2024, it reiterated the endeavor with renewed urgency over the past spring amid the rising U.S.-China trade battle, sources told Reuters.
• While the carmaker would prefer to obtain parts for vehicles made in North America from factories in the region, it is also open to sourcing them from outside the U.S. if they are not from China or other countries subject to U.S. trade restrictions.

General Motors (GM) has reportedly directed several thousand of its suppliers to remove parts from China from their supply chain.

Reuters reported on Wednesday, citing four people familiar with the matter, that GM executives have been instructing suppliers to find alternatives to China for raw materials and parts. The company aims to eventually move its supply chain out of China entirely.

To some suppliers, the carmaker has set a deadline of 2027 to remove their China sourcing ties, the report said.

A Renewed Push

While GM approached some suppliers with the directive in 2024, it reiterated the endeavor with renewed urgency over the past spring amid the rising U.S.-China trade battle, sources told Reuters.

While the carmaker would prefer to obtain parts for vehicles made in North America from factories in the region, it is also open to getting them from outside of the U.S. if it's not from China or other countries subject to U.S. trade restrictions such as Russia and Venezuela, they added.

China’s Significance, GM’s Efforts

Automakers rely on China for parts and raw materials, including rare-earth materials. However, tensions between the two countries, China’s restrictions on rare-earth element shipments, and President Trump’s tariff announcements and rollbacks have raised questions about the reliability of the supply chain, while automakers attempt to ramp up domestic manufacturing.

In June, GM announced plans to invest about $4 billion over the next two years in its domestic manufacturing plants to increase U.S. production of both gas and electric vehicles. The investment, it said, will provide the automaker the ability to assemble over two million vehicles per year in the U.S by onshoring production at plants in Tennessee, Kansas, and Michigan. GM has a network of 50 U.S. manufacturing plants and parts facilities in 19 states, including 11 vehicle assembly plants.

“We are also monitoring the supply of certain chips from China. This is an industry issue I know you are all aware of. While this has the potential to impact production, we have teams working around the clock with our supply chain partners to minimize possible disruptions,” CEO Mary Barra said last month in the company’s third quarter earnings call.

How Did Stocktwits Users React?

On Stocktwits, retail sentiment around GM stock stayed within the ‘bearish’ territory over the past 24 hours, while message volume stayed at ‘extremely low’ levels.

GM stock is up by 34% this year and by 24% over the past 12 months. 

Also See: IBM Launches Most Powerful Quantum Chip Yet, Eyes Fault-Tolerant Computer By 2029

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