GM To Invest $2.2B Turning Detroit Plant Into New Electric-Vehicle Hub

General Motors (GM) has announced that it is investing $2.2B to reconfigure its Detroit-Hamtramck Assembly Center to an all-electric vehicle assembly plant, and rebranding it as Factory Zero.

The name Factory Zero reflects GM’s zero-crashes, zero-emissions and zero-congestion future, says GM, adding that it will be the launchpad for the company’s multi-brand EV strategy.

The GMC Hummer EV pickup and the Cruise Origin, a purpose-built electric, self-driving, shared vehicle, and other GM EVs will be built at the factory, with production of the GMC Hummer EV pickup kicking off in late 2021.

“Factory Zero is the next battleground in the EV race and will be GM’s flagship assembly plant in our journey to an all-electric future,” said GM’s Gerald Johnson. “The electric trucks and SUVs that will be built here will help transform GM and the automotive industry.”

The plant is being transformed with sustainability in mind, says GM, which has committed itself to sourcing 100% of its U.S. facilities with renewable energy by 2030, and all global facilities by 2040.

At the same time the company announced that Cruise has now received permission from the California DMV to remove human backup drivers from its self-driving cars.

“We’re not the first company to receive this permit, but we’re going to be the first to put it to use on the streets of a major U.S. city… Before the end of the year, we’ll be sending cars out onto the streets of San Francisco — without gasoline and without anyone at the wheel” the company stated.

Shares in GM are down about 9% year-to-date, however the $39 average price target suggests that analysts expects shares to advance 17% in the coming 12 months.

Merrill Lynch analyst John Murphy recently reiterated a Buy rating on the stock with a $65 price target (94% upside potential) as the analyst shed light on how he expects the upcoming US elections to impact the country’s auto industry.

“In an election outcome of a Biden presidency but a split Congress, we would anticipate an initially positive reaction for automotive stocks, as the likelihood of policy standstill mitigates risk of bottom line impediments, while the new administration could provide greater stability and predictability that would support companies’ longer-term decision-making,” Murphy told investors.

Overall, Wall Street analysts are cautiously optimistic on the stock. The Moderate Buy consensus is based on 11 Buys versus 3 Holds and 1 Sell. (See GM stock analysis on TipRanks).