GM beats Q3 forecasts, raises 2024 profit outlook

[JACK AYLMER]

GENERAL MOTORS IS RIDING HIGH AFTER A VERY STRONG THIRD-QUARTER EARNINGS REPORT, SURPRISING WALL STREET AND RAISING ITS PROFIT OUTLOOK. 

THE COMPANY’S REVENUE JUMPED MORE THAN 10-PERCENT TO NEARLY 49 BILLION DOLLARS… EASILY SURPASSING FORECASTS. ADJUSTED PROFIT WAS 3-POINT-4 BILLION… UP FROM 3-POINT-2 BILLION IN THE SAME PERIOD LAST YEAR. EVEN THOUGH THE MANUFACTURER SOLD JUST 5-PERCENT MORE VEHICLES, THE AVERAGE PRICE OF A CAR IS RISING, AND IS NOW CLOSE TO 50 THOUSAND DOLLARS.

LAST YEAR’S STRIKE COST GM OVER A BILLION DOLLARS. THE COMPANY ORIGINALLY RESISTED UNION DEMANDS, SAYING THEY COULDN’T STAY COMPETITIVE. BUT AFTER WEEKS OF NEGOTIATIONS, THEY AGREED TO HISTORIC WAGE INCREASES… AN IMMEDIATE 11-PERCENT RAISE, PLUS 14-PERCENT MORE OVER THE NEXT FOUR YEARS. TODAY… GM SAYS THEY’VE MANAGED TO ABSORB THOSE COSTS.

WHILE THINGS ARE LOOKING UP IN NORTH AMERICA, GM’S BUSINESS IN CHINA IS STRUGGLING. THE AUTOMAKER LOST 137 MILLION DOLLARS THERE IN THE THIRD QUARTER. SALES FELL 37-PERCENT DUE TO GROWING COMPETITION FROM CHINESE BRANDS.

BUT THERE’S ALSO A LOT OF MOVEMENT IN ELECTRIC VEHICLES. GM’S SHARE OF THE U-S ELECTRIC VEHICLE MARKET HIT 6-POINT-6 PERCENT IN Q3 OF 2024. TESLA REMAINS THE DOMINANT FORCE, HOLDING NEARLY 50-PERCENT OF THE MARKET… BUT THE COMPETITION IS CATCHING UP. IN TOTAL, E-V’S ACCOUNTED FOR 7-POINT-3 PERCENT OF ALL NEW CAR SALES IN THE U-S LAST YEAR, AN 18-PERCENT GROWTH FROM LAST YEAR, MOVING NEARLY 14 MILLION CARS ONTO THE ROAD… A NUMBER LIKELY TO BE ECLIPSED IN 2024.

GM EXPECTS 2024 TO BE A RECORD YEAR FOR PROFITS. THE COMPANY’S STOCK HAS ALREADY CLIMBED OVER 40-PERCENT THIS YEAR. 

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FOR STRAIGHT ARROW NEWS… I’M JACK AYLMER.