General Motors has raised several financial projections for 2024 following a strong second quarter that exceeded Wall Street estimates. The automaker has updated its adjusted earnings expectations for the year to a range of $13 billion to $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM has revised its targets for operating cash flow and earnings per share. However, the forecast for net income attributable to shareholders has been slightly lowered by less than 1%, now estimated between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, marking over a 7% increase from the same period last year and surpassing the $45 billion anticipated by analysts, according to FactSet estimates. Earnings per share were recorded at $3.06, well above analysts’ expectations of $2.71 and reflecting a 60% increase from 2023. Net income rose by 14% to $2.9 billion, compared to $2.5 billion in the previous year.
In pre-market trading on Tuesday, GM’s stock surged nearly 5%, and it has seen an increase of over 37% this year. Following the market closure on Monday, GM declared a cash dividend for the third quarter, which has further bolstered investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the success of the company’s gas-powered trucks and SUVs, announcing plans to launch eight new or redesigned models in North America. She emphasized that GM is scaling production of the electric Chevrolet Equinox and remains committed to disciplined growth in electric vehicle (EV) sales, despite acknowledging the company will not meet its goal of producing 1 million EVs in North America by the end of 2025 due to market slowdowns. GM aims to be flexible and respond to demand while reporting an increase in EV sales during the last quarter.
Barra also shared news regarding Cruise, GM’s self-driving unit, which will discontinue its Origin vehicle program after scaling back operations following an incident in October. Instead, Cruise will utilize the next-generation Chevrolet Bolt for testing in Texas and Arizona, leading to a $600 million charge related to halting Origin production in Detroit. She mentioned that transitioning to the Bolt would alleviate concerns from regulators regarding the unique design of the Origin, which lacked a steering wheel, while also reducing costs and optimizing resources.
“Our vision to transform mobility using autonomous technology remains intact; every mile and every simulation gets us closer because Cruise is fundamentally an AI-focused company,” Barra stated.
Additionally, GM is working to restructure its joint venture in China with SAIC Motor, responding to ongoing losses, which included a $104 million loss in the second quarter. In June, SAIC-GM notably reduced production by 70%, delivering 26,000 vehicles, a 50% decline compared to the previous year, as reported by Automotive News.