CEO Mary Barra announced Tuesday that a “substantial portion” of GM’s long-term executive compensation is going to be tied to the company’s electric vehicle targets.
Starting this year, the compensation targets, according to Barra, will include EV volume in North America, as well as release timing and quality.
GM wants to grow electric vehicle production to two million in China and North America by 2025, with the goal of selling only electric vehicles by 2035. By the middle of the decade, the business expects to surpass Tesla as the top-selling electric vehicle manufacturer. By then, Barra said on Tuesday that GM anticipates EV sales in North America to reach $50 billion.
“At GM, our pay has always been determined by the company’s performance. “No one should underestimate our resolve to lead in EVs, or our team’s passion for that purpose,” Barra stated during the company’s first-quarter earnings call.
In the aftermath of industry leader Tesla’s ascension to be the top-valued manufacturer with a market price of over $900 billion, Wall Street has raised pressure on the Detroit automaker to shift to electric vehicles.
The new compensation targets, according to Barra, are aimed to emphasize the company’s commitment to electric vehicles. More information on the EV compensation targets will be included in the company’s forthcoming proxy filing, which Barra expects to be filed on Friday.
Barra’s total remuneration package in 2020 was $23.7 million, which included a basic salary of roughly $2 million and $13 million in stock awards.
There’s a lot going on before GM executives get paid.
GM has revealed a new 50 GWh battery factory coming to the US in 2022, as well as a $7 billion investment in growing EV production in the United States. That’s not even taking into account a plethora of new electrified vehicles, including the Blazer, Chevy Equinox, and an AWD Corvette. Oh, and by the middle of the decade, GM intends to dethrone Tesla as the best-selling electric vehicle. GM plans to generate $50 billion in EV revenues in North America alone by that time, according to Barra.
These are lofty aims to which GM is devoting a lot of time (and money), but the outcomes have been disappointing thus far. GM shipped 457 electric vehicles in the first quarter of 2022, including 99 of its newest GMC Hummer EV truck. This low figure is due to a long-running tale of suspended Bolt EV and EUV manufacturing that has now begun, as well as a shortage of other EV alternatives currently on the market.
Last month, the first Cadillac Lyriqs built on GM’s Ultium platform rolled off the production line in Tennessee, and we should expect sales to begin soon. Meanwhile, production of the Bolt and Hummer EVs will continue to increase. Of course, there’s a lot in the works, but not much is coming out of it just yet.