General Motors has adjusted several financial targets for 2024 following strong second-quarter results that exceeded Wall Street predictions. The automaker is now projecting adjusted earnings for the year in the range of $13 billion to $15 billion, an increase from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share, although the net income expected for shareholders has been slightly revised downward to between $10 billion and $11.4 billion.
During the second quarter, GM reported revenues of $47.9 billion, a rise of over 7% compared to the previous year, surpassing Wall Street’s expectations of $45 billion. The company’s earnings per share reached $3.06, which is higher than the anticipated $2.71 and represents a 60% increase from 2023. Net income rose by 14% to $2.9 billion, up from $2.5 billion.
Following these announcements, GM’s stock increased nearly 5% in pre-market trading on Tuesday, bringing its total growth this year to more than 37%. On Monday, GM also declared a cash dividend for the third quarter, further boosting investor confidence.
In a shareholder letter, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, revealing that the company is launching eight new or redesigned models in various sizes across North America. Barra emphasized GM’s commitment to scaling production of the electric Chevrolet Equinox and maintaining disciplined volume growth despite the excitement surrounding electric vehicles (EVs). Although GM’s EV sales rose last quarter, Barra previously acknowledged that the company would not achieve its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
In a notable operational shift, Barra announced that Cruise, GM’s self-driving unit, would discontinue its Origin vehicle, opting instead to utilize the next-generation Chevrolet Bolt for tests in Texas and Arizona. This decision follows a previous setback for Cruise, which reduced its operations after an incident last October. GM incurred a $600 million charge related to ceasing Origin production in Detroit.
Barra stated that the transition to the Bolt would address regulatory concerns regarding the Origin’s unconventional design, such as its lack of a steering wheel. This strategy is expected to decrease costs per unit and allow for more efficient resource management.
Additionally, GM is working to restructure its joint venture with SAIC Motor in China, where the company has reported a loss of $104 million for the second quarter. In June, SAIC-GM reduced production by 70%, delivering only 26,000 vehicles, which is 50% less than the previous year.