‘The Trump Effect’: GM invests $888 MILLION in New York plant

White House Press Secretary Karoline Leavitt posted on X, “The Trump Effect: Today marks the largest single investment the company has ever made in an engine plant and makes Tonawanda the second GM propulsion plant to produce this new generation of engines.”

According to the Detroit Free Press, the $888 million retooling project is expected to take two years, allowing production of GM’s fifth-generation V-8 to continue through 2027. The sixth-generation engine will power the automaker’s full-size trucks and SUVs — a vehicle segment that remains a cornerstone of American automotive strength. This follows a $300 million investment to convert part of the Tonawanda facility for electric vehicle (EV) drive unit production.

Republicans point to this and other recent moves as evidence that Trump-era trade policies laid the groundwork for reshoring American jobs and reversing decades of manufacturing decline.

The investment is projected to support 870 jobs at the Tonawanda plant, including 177 jobs that were previously at risk of elimination. In exchange, New York State is offering GM up to $16.96 million in tax incentives — a small price, Republicans argue, for restoring blue-collar prosperity.

The Tonawanda announcement comes on the heels of a $579 million investment in Flint, Michigan, where GM is also retooling to build the sixth-generation V-8. The Flint facility will continue to produce the fifth-generation engine in tandem, with overlapping production allowing GM to meet demand while modernizing its production lines.

GM engines built in Buffalo are shipped to major US vehicle assembly plants in Indiana, Texas, Missouri, and Kentucky, as well as to Canada. The next-generation V-8 engine is expected to launch with the 2027 Chevrolet Silverado and GMC Sierra — a timeline that aligns with current retooling schedules.

Auto industry analyst Sam Fiorani from AutoForecast Solutions noted, “You can’t spend nearly a billion dollars on a plant and have it go away in a couple years. This guarantees production will continue for years — we're likely to see V-8's well into the 2030s.”

While the Biden administration pushed EV mandates and climate regulations, GM's massive investment in V-8 engines tells a different story. The automaker also announced earlier this year it would expand transmission production at its Toledo, Ohio, plant while scaling back EV drive unit output — a sign that consumer demand and market realities still favor traditional powertrains.

Additionally, GM recently laid off 200 employees at its Factory Zero EV plant in Detroit to ensure that production will “align with market dynamics.”

GM is also continuing fifth-generation V-8 production to address a major recall involving over 721,000 vehicles due to internal engine defects. Impacted models include the Cadillac Escalade, Chevrolet Silverado, Suburban, Tahoe, and GMC Yukon. Until the issues are resolved, and with customer demand still strong, the company says both generations of engines will need to be produced in parallel.