Joseph White and Ben Klayman

DETROIT, (Reuters) –General Motors Co said on Tuesday it will spend greater than $35 billion through 2025 to boost the launches of new electric cars. The company also stated that technological investments are more important than richer profits in next year.

GM expects to make an operating profit between $13 billion and $15 billion in 2022, which is similar to a record $14.3 billion operating profit for 2021. However, vehicle production will increase, while pricing power should stay strong.

Paul Jacobson, GM’s Chief Financial Officer stated during a conference that “what we are doing is essentially redeploying some upside earnings of the additional volume into acceleration” and that he was taking a longer-term approach to profit maximization than trying to maximize the short-term.

Mary Barra, Chief Executive Officer of GM, stated that GM has “accelerated within the 20 to ’25 timeframe starting at $35 billion but that there are also certain investments that we’re pulling into” that were not planned for later in the decade.

Barra has not provided a number for total EV investments up to 2025. In its quarterly report, GM indicated that they expect to spend $1.5B more in order to increase software development speed and expand its EV portfolio.

GM shares have fallen below their recent highs due to Ford Motor’s (NYSE:) Co increasing investments in electric vehicles programs and the Ford F-150 Lightning pickup trucks. GM, however, has taken a conservative approach and plans more EV launches for the upcoming decade.

Barra, along with other GM executives, are now proving that GM has a more comprehensive long-term strategy and is prepared to react faster to increasing demand for electric vehicles.

Barra indicated that the company will be able to offer more affordable electric vehicles. GM is developing a lower price electric car and will soon launch the $30,000 Chevrolet Equinox electric automobile. Elon Musk, Tesla Inc (NASDAQ:) Inc’s Chief Executive Officer last week stated that the market leader in electric vehicles isn’t working on the $25,000 vehicle he promised.

GM’s 2022 profit outlook is also affected by rising costs. GM stated that it expects $2.5 billion more in logistics and commodities costs and $1 billion less profits from its financing arm this year.

GM’s 2021 operating profit was $14.3 billion, and its net income $10 billion. It anticipates 2022 net earnings of between $9.4 billion and $10.8 million, depending on whether there are any significant supply or economic challenges.

Fourth quarter net income totaled $1.67 billion, while operating profit totaled $2.8 billion. GM’s quarterly net income margin was 5.2%, compared to 7.9% for the full year.

In 2021, the automaker saw a decline in vehicle sales and market share. However EBIT-adjusted margins rose as GM concentrated on SUVs and pickups that are more profitable.

After-hours trading was volatile for GM shares, with the last trade ending 1.3% lower.