U-turn on the move: General Motors to invest $888 million in engine production at New York plant

General Motors is investing $888 million in the Tonawanda Powertrain plant in Buffalo, N.Y., to increase engine production and create a next-generation V8 engine.

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Back in 2023, after negotiations with the United Auto Workers union, GM promised to invest $300 million in the facility to produce drive units for electric vehicles. The shift, as Reuters notes, is another sign of automakers adapting to slower-than-expected market demand for electric vehicles. GM said the investment will support the sixth generation of V8 engines used in full-size pickups and SUVs.

New York Governor Kathy Hochul said the project will support 870 jobs at the Tonawanda Propulsion plant. The state plans to provide up to $16.96 million in tax credits in exchange for investment commitments.

GM has been more assertive in staying the course in the transition to electric vehicles than other U.S. automakers. But it has also backed away from some of its previously announced investments in the segment, including selling a share of a battery-cell plant to battery partner LG Energy.

GM Chief Executive Mary Barra said the automaker has a plan to sell only electric passenger cars by 2035, but said the company would be flexible in responding to market conditions.

Source: Reuters