General Motors has announced an increase in its financial targets for 2024, following strong second-quarter results that exceeded Wall Street’s expectations. The Detroit-based automaker has adjusted its projected adjusted earnings for the year to range between $13 billion and $15 billion, up from a previous forecast of $12.5 billion to $14.5 billion. It also raised its targets for operating cash flow and earnings per share, while slightly lowering the expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
In the second quarter, GM reported revenue of $47.9 billion, marking a 7% increase compared to the same period last year and surpassing the anticipated $45 billion. Earnings per share stood at $3.06, notably higher than the expected $2.71 and 60% greater than in 2023. The company’s net income rose 14% to $2.9 billion, up from $2.5 billion.
Following these results, GM’s stock experienced a nearly 5% increase in pre-market trading and has risen over 37% this year. Additionally, GM announced a third-quarter cash dividend after trading closed on Monday, contributing to the stock’s positive momentum.
In her communication to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and mentioned the launch of eight new or redesigned vehicle models in North America. Barra emphasized the scaling of production for the electric Chevrolet Equinox, stating, “as excited as we are about our EVs and our early success, we are committed to disciplined volume growth.”
Despite these gains, Barra acknowledged that GM will not meet its target of producing 1 million electric vehicles in North America by the end of 2025, attributing this to a slowdown in the market. The company plans to be flexible and align production with demand, although it reported an increase in EV sales last quarter.
Barra also revealed that Cruise, GM’s self-driving division, will discontinue its Origin vehicle project after halting production last October due to a regulatory incident. Instead, Cruise will focus on using the next-generation Chevrolet Bolt for testing its autonomous vehicles in Texas and Arizona. This strategic shift is expected to reduce unit costs and optimize resources, as GM incurred a $600 million charge linked to the halt in Origin production.
“Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company,” Barra stated.
Additionally, GM is restructuring its joint venture in China with SAIC Motor, as it continues to incur losses, reporting a $104 million loss for the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, which is a 50% decrease compared to the previous year.