General Motors has raised several financial targets for 2024 following its strong second-quarter performance, which exceeded Wall Street expectations. The Detroit-based automaker now anticipates adjusted earnings for the year to be in the range of $13 billion to $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Additionally, it has elevated its projections for operating cash flow and earnings per share, while slightly reducing its 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 over a 7% increase from the previous year and surpassing the $45 billion forecasted by analysts. Earnings per share reached $3.06, significantly exceeding the expected $2.71 and representing a 60% increase compared to 2023. The company’s net income rose by 14% to $2.9 billion, up from $2.5 billion.
Following the report, GM’s stock surged nearly 5% in pre-market trading, and has seen an overall increase of more than 37% this year. The company also declared a third-quarter cash dividend, providing an additional boost to its stock value.
In a letter to shareholders, CEO Mary Barra highlighted the successful performance of its gas-powered trucks and SUVs. She announced that GM is in the process of launching eight new or redesigned vehicle models across various categories in North America. Furthermore, Barra noted the scaling of production for the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined volume growth amid early successes with electric vehicles.
Earlier this month, Barra admitted that GM would not meet its target of producing 1 million electric vehicles by the end of 2025 due to a market slowdown. The company plans to adapt by “building to demand,” even though EV sales did see growth in the last quarter.
Additionally, Barra revealed that Cruise, GM’s self-driving unit, has decided to abandon its Origin vehicle plan after operational setbacks. Instead, Cruise will utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM incurred a $600 million charge associated with the disruption of the Origin production in Detroit.
During a discussion with analysts, Barra expressed that using the Bolt would help address regulatory concerns regarding the Origin’s unconventional design, which lacked a steering wheel. This transition is expected to lower unit costs and enhance resource optimization.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that each mile and simulation brings Cruise closer to its goal, reinforcing the company’s position as an AI-first enterprise.
Furthermore, GM is working to restructure its joint venture with SAIC Motor in China as it faces ongoing losses, including a $104 million loss reported for the second quarter. SAIC-GM had previously reduced production by 70% in June, delivering 26,000 vehicles, which is 50% less than the same period the previous year.