GM made $10 billion last year despite a strike by auto workers, but it is prepared for lower car prices this year.

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DETROIT (AP) — General Motors’ net income rose 12% last year despite losing more than $1 billion when many of its plants were closed because of the coronavirus. Auto workers strike for six weeks.

The company expects a slight improvement this year even as it plans to reduce vehicle selling prices due to increased discounts.

General Motors shares jumped nearly 8% before the opening bell on Tuesday.

The Detroit automaker made just over $10 billion last year, up from $8.9 billion in 2022. Excluding one-time items, the company earned $7.68 per share, easily exceeding the $7.57 Wall Street expected, according to FactSet.

Full-year revenue was $171.84 billion, about 10% higher than in 2022. This also beat estimates of $167.26 billion.

The company expects there is a good chance that net income will improve slightly, from a range of $9.8 billion to $11.2 billion. It expects adjusted earnings per share to range between $8.50 to $9.50, compared to $7.68 last year.

Because of North American pretax profits of $12.3 billion, about 45,000 UAW members will receive profit-sharing checks worth $12,250, the company said.

GM is bracing for the average vehicle sales price to fall 2% to 2.5% this year from last as inventory grows amid rising interest rates, Chief Financial Officer Paul Jacobson told reporters. He said that GM had planned to reduce prices over the past two years, but they did not materialize.

“That’s not actually what we’re seeing in the market today,” Jacobson said, adding that average selling prices are “actually holding up very similarly to what we saw at the end of 2023.”

He said prices are stable for both internal combustion vehicles and electric vehicles, which is contrary to industry trends.

Cutting costs by simplifying engineering and manufacturing saved GM about $1 billion last year, and another $1 billion is expected to be saved this year, Jacobson said.

GM has struggled to start mass production of new electric vehicle models over the past year, but Jacobson said there is still strong demand for the products that are on sale now. The company expects EV losses are falling this year It achieves low- to mid-single-digit profit margins in 2025 as it adds more electric vehicles to its lineup.

Over the past year, GM has lost $1.1 billion from the UAW strike, plus it has booked $800 million in costs as a result of a major Chevrolet Bolt EV battery recall. It also took a $1.7 billion accounting charge on the valuation of its electric vehicle inventory, which will lead to losses, Jacobson said. These expenses will not occur in 2024, he said.

The company also expects to spend $1 billion less on its products Turbulent autonomous cruise vehicle module Because it slows down the rollout of self-driving robotaxis. The company lost $2.7 billion before taxes on Cruise last year.

Jacobson said the company expects labor costs to rise this year by $1.3 billion, and is prepared to lose about $3 billion due to lower prices.

In the fourth quarter, GM generated $2.08 billion, up 4.5% from the previous year. Without one-time items, the company earned $1.24 per share, 8 cents more than analysts’ estimates.

Revenue from October through December was $42.98 billion, down slightly from the same period in 2022 but still beating estimates.

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