General Motors has announced an increase in several financial projections for 2024 following a robust performance in the second quarter that exceeded Wall Street forecasts.
The Detroit-based automaker has adjusted its expected adjusted earnings for the year to a range of $13 billion to $15 billion, up from the previous forecast of $12.5 billion to $14.5 billion. Additionally, GM raised its targets for operating cash flow and earnings per share. However, expectations for net income attributable to shareholders were slightly lowered to between $10 billion and $11.4 billion, a decrease of less than 1%.
In the second quarter, GM’s revenue reached $47.9 billion, marking an increase of over 7% year-on-year and surpassing the anticipated $45 billion as per FactSet estimates. Earnings per share stood at $3.06, exceeding the analyst expectation of $2.71 and representing a 60% increase compared to 2023. The company’s net income rose by 14%, reaching $2.9 billion, up from $2.5 billion.
As a result of these developments, GM’s stock surged nearly 5% in pre-market trading on Tuesday. The stock has experienced a remarkable increase of over 37% this year. Following the market close on Monday, GM announced a cash dividend for the third quarter, contributing to the stock’s positive movement.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs, and mentioned the company’s plans to launch eight new or redesigned models across various categories in North America. Barra also indicated that GM is ramping up production of the electric Chevrolet Equinox and emphasized the company’s commitment to disciplined volume growth despite earlier statements that GM would not meet its target of producing 1 million electric vehicles in North America by the end of 2025 due to a market slowdown.
Barra noted that the company is adapting its strategy to “build to demand,” although EV sales showed growth in the last quarter. Moreover, she announced that Cruise, GM’s autonomous driving division, will discontinue its Origin vehicle in favor of the next-generation Chevrolet Bolt for testing in Texas and Arizona, following a reduction in operations after an incident last October. GM incurred a $600 million charge linked to the Origin’s halted production.
During a call with analysts, Barra explained that the shift to using the Bolt would address regulatory concerns related to the Origin’s unconventional design, including the absence of a steering wheel. This change is expected to lower costs and help GM optimize its resources.
Barra reaffirmed GM’s commitment to transforming mobility through autonomous technology, stating, “Our vision is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company.”
Additionally, GM is working to restructure its joint venture with SAIC Motor in China amid ongoing financial losses. The company recorded a $104 million loss in the second quarter, and production at SAIC-GM was cut by 70% in June, with only 26,000 vehicles delivered—down 50% compared to the previous year.