General Motors has revised its financial projections for 2024 upwards after exceeding Wall Street’s forecasts for the second quarter. The Detroit-based automaker now expects adjusted earnings to fall between $13 billion and $15 billion, an increase from the previously anticipated range of $12.5 billion to $14.5 billion. Additionally, GM has raised its targets for operating cash flow and earnings per share while slightly lowering its expectations for net income attributable to shareholders to between $10 billion and $11.4 billion, a decrease of less than 1%.
In the second quarter, GM reported revenue of $47.9 billion, representing a more than 7% increase from the previous year and surpassing Wall Street’s estimate of $45 billion based on FactSet data. Earnings per share were $3.06, significantly higher than the anticipated $2.71 and a 60% increase compared to 2023. Net income rose by 14% to $2.9 billion, up from $2.5 billion.
The company’s stock rose nearly 5% in pre-market trading on Tuesday and has increased over 37% this year. GM also declared a cash dividend for the third quarter, further boosting investor confidence.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and revealed plans to launch eight new or redesigned vehicle models in North America. Barra emphasized GM’s commitment to a disciplined approach to scaling production of the electric Chevrolet Equinox, despite the company recently acknowledging it would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a slowdown in the market. However, EV sales did experience growth in the last quarter.
Additionally, Barra announced that Cruise, GM’s self-driving division, will abandon its plans for the Origin vehicle and instead focus on using the next-generation Chevrolet Bolt for testing in Texas and Arizona. This decision follows a $600 million charge incurred due to the halt of Origin production in Detroit. According to Barra, utilizing the Bolt will address regulatory concerns about the Origin’s unusual design and will help reduce per unit costs while optimizing resources.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating that every test mile and simulation progresses the company toward that vision.
GM is also working on restructuring its joint venture with SAIC Motor in China, as it continues to face losses in that market, with a reported loss of $104 million in the second quarter. In June, the SAIC-GM partnership reduced production by 70% and delivered only 26,000 vehicles, representing a 50% decline compared to the same period last year.