DETROIT – General Motors expects a restructuring of its joint venture operations with SAIC Motor Corp. in China to cost more than $5 billion in noncash charges and write-downs, the Detroit automaker disclosed in a federal filing Wednesday morning.

GM said it expects to write down the value of its joint-venture operations in China by between $2.6 billion and $2.9 billion. It also anticipates another $2.7 billion in charges to restructure the business, including “plant closures and portfolio optimization,” according to the filing.

GM, which previously announced plans to restructure the operations in China, did not disclose any additional details about the expected closures.

“As we have consistently said, we are focused on capital efficiency and cost discipline and have been working with SGM to turn around the business in China in order to be sustainable and profitable in the market. We are close to finalizing our restructuring plan with our partner, and we expect our results in China in 2025 to show year-over-year improvement,” GM said in an emailed statement.

GM said it believes the joint venture “has the ability to restructure without new cash investments” from the American automaker.

A majority of the restructuring costs is expected to be recognized as noncash, special item charges during the fourth quarter. That means they will impact the automaker’s net income, but not its adjusted earnings before interest and taxes – a key metric monitored by Wall Street.

GM CFO Paul Jacobson during a UBS conference Wednesday said the companies are “very close to finalizing everything” regarding the China restructuring. He said GM expects the actions to make the operations “profitable on a smaller scale” by next year without investing incremental capital.

GM’s operations in China have shifted from a profit engine to a liability in the past decade as competition grows from government-backed domestic automakers fueled by nationalism, and as a generational shift in consumer perceptions of the automotive industry and electric vehicles takes hold.

Equity income from GM’s Chinese operations and joint ventures peaked at more than $2 billion in 2014 and 2015.

GM’s market share in China, including its joint ventures, has plummeted from roughly 15% as recently as 2015 to 8.6% last year — the first time it has dropped below 9% since 2003. GM’s equity income from the operations has also fallen, down 78.5% since peaking in 2014, according to regulatory filings.

GM’s U.S.-based brands such as Buick and Chevrolet have seen sales drop more than its joint venture sales with SAIC Motor, Wuling Motors and others. The joint venture models accounted for about 60% of its 2.1 million vehicles sold last year in China.

Before this year, the only quarterly losses for GM in China since 2009 were a $167 million shortfall during the first quarter of 2020 due to the coronavirus pandemic and an $87 million loss during the second quarter of 2022.

The Detroit automaker has reported three consecutive quarterly losses in equity income for its Chinese operations this year, totaling $347 million. That includes a loss of $137 million during the third quarter.

DETROIT — General Motors plans to sell its stake in a $2.6 billion electric vehicle battery cell plant in Michigan to its joint venture partner LG Energy Solution, the automaker announced Monday.

The Detroit carmaker said it expects to recoup its investment in the facility, which a source familiar with the plans said is anticipated to be roughly $1 billion. The sale is part of a nonbinding agreement between the two companies that is anticipated to close during the first quarter of next year, GM said.

The nearly completed, 2.8 million-square-foot plant in Lansing, Michigan, was expected to be the third battery cell facility of the joint venture, known as Ultium Cells LLC, following plants in Ohio and Tennessee that have already opened and are operational.

The Lansing plant was announced in January 2022, and the two companies first announced their joint venture five years ago.

GM’s move comes as the automaker attempts to right size production of EVs and confronts slower-than-expected consumer demand. It also comes amid uncertainty regarding federal incentives for manufacturing and purchasing EVs in the U.S. under President-elect Donald Trump.

The automaker said the sale does not affect its overall ownership stake in the joint venture or its future plans for a separate joint venture plant with LGES rival Samsung SDI.

“We believe we have the right cell and manufacturing capabilities in place to grow with the EV market in a capital efficient manner,” GM Chief Financial Officer Paul Jacobson said in a release. “When completed, this transaction will also help LG Energy Solution meet demand by leveraging capacity that’s nearly ready to come online and it will make GM even more efficient.” 

GM said the South Korean battery supplier will have immediate access to the Lansing facility to begin installation of equipment. The plant, which currently employs nearly 100 people, was expected to begin operating by the end of this year.

Separate from the sale of its stake in the Lansing facility, GM on Monday announced it will extend a 14-year battery technology partnership with LGES to include the development of an emerging type of battery cell called prismatic cells.

Prismatic cells are a flat, rectangular shape with a rigid enclosure, which allows for space-efficient packaging within battery modules and packs. GM said the cells are expected to reduce EV weights and costs, while simplifying manufacturing by reducing the number of modules and mechanical components.

“We’re focused on optimizing our battery technology by developing the right battery chemistries and form factors to improve EV performance, enhance safety, and reduce costs. By extending our partnership with LG Energy Solution, we’re taking an important step towards these goals,” Kurt Kelty, GM vice president of battery cell and pack, said in a release.

GM had previously said it planned to expand its battery cell technologies from its flat “Ultium” pouches to include other forms such as prismatic cells.