General Motors has updated its financial forecasts for 2024 following a strong performance that exceeded Wall Street’s expectations for the second quarter. The Detroit-based automaker has raised its projected adjusted earnings for the year to a range of $13 billion to $15 billion, an increase from the previous estimate of $12.5 billion to $14.5 billion. GM has also revised its targets for operating cash flow and earnings per share, while slightly lowering expectations for net income attributable to shareholders to between $10 billion and $11.4 billion.
For the second quarter, GM reported revenue of $47.9 billion, representing more than a 7% increase compared to the same period last year and surpassing the $45 billion anticipated by analysts. Earnings per share came in at $3.06, exceeding the expected $2.71 and showing a 60% increase from 2023. The company’s net income rose 14%, reaching $2.9 billion compared to $2.5 billion in the prior year.
GM’s stock saw a nearly 5% increase in pre-market trading following the announcement. Year-to-date, the stock has risen over 37%. Additionally, GM declared a third-quarter cash dividend, which provided a further boost to the stock.
In a letter to shareholders, CEO Mary Barra highlighted the success of GM’s gas-powered trucks and SUVs and announced plans to launch eight new or redesigned models across various size categories in North America. She also indicated progress in ramping up production of the electric Chevrolet Equinox, emphasizing the company’s commitment to disciplined volume growth despite early success in the electric vehicle (EV) market.
Barra mentioned earlier that GM would not meet its goal of producing 1 million electric vehicles in North America by the end of 2025 due to a slowdown in the market. The company has stated it will adapt its production to meet demand, although EV sales saw an increase in the last quarter.
Additionally, it was revealed that Cruise, GM’s self-driving division, would discontinue its Origin vehicle after scaling back operations following an incident last October. Instead, Cruise will focus on utilizing the next-generation Chevrolet Bolt for testing in Texas and Arizona. GM recorded a $600 million charge connected to the suspension of Origin’s production in Detroit.
During a call with analysts, Barra noted that shifting to the Bolt would help address regulatory concerns related to the unique design of the Origin, which did not include a steering wheel. This change is expected to reduce per-unit costs and improve resource optimization.
Barra reaffirmed GM’s commitment to transforming mobility with autonomous technology, stating, “Our vision to transform mobility using autonomous technology is unchanged, and every mile traveled, and every simulation, brings us closer because Cruise is an AI-first company.”
Moreover, GM is restructuring its joint venture in China with SAIC Motor amid ongoing losses, which included a $104 million loss in Q2. In June, SAIC-GM reduced production by 70%, delivering 26,000 vehicles, a 50% decline from the previous year.