GM recovers profitability with far better-than-expected returns.

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The largest automaker in the U.S. generated $4.1 billion in revenue excluding special items, up from $2.5 billion a year ago. It’s far better than the $2.1 billion predicted by analysts, up 64% over GM’s third quarter earnings a year ago.

Revenue was basically $35.7 billion, consistent with expectations. GM was able to maintain sales despite a 4% decline in numbers. Cars sold Worldwide. that much Car factory closure Health protocols have limited inventory of vehicles available for sale, and the recession has damaged demand for some fleet buyers, especially: Car rental company.

However, the demand that was there increased the average price of the vehicle, allowing GM to maintain a constant sales revenue.

“Sales in the US and China are recovering faster than many expected,” said John Stapleton, GM’s interim CFO. I am receiving it.”

However, a real improvement was seen in the company’s margins, which surged from 8.4% a year ago to 14.9%.

GM Stop dividends In April Increased borrowing As a way to keep cash during the recession caused by the epidemic. But on Thursday, it announced that it could pay an additional $5.2 billion in credit line in the third quarter and an additional $3.9 billion in October. The company expects to pay off the balance by the end of the year.

CEO Mary Barra said if the current recovery continues, GM will resume its dividends in mid-2021.

“We know this is a top priority for our shareholders,” she told analysts.

However, the company is still relatively rich in cash. Cash flows from car operations reached $9.1 billion at the end of the quarter from $17.3 billion at the beginning of the year before Covid-19 destroyed the economy to $30.2 billion at the end of the quarter.

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And that cash generation gives GM the cash it needs to invest in new products and plants like electric vehicles.

“The strengths of our North American business, especially the heavy truck platforms and heavy SUVs, give us a great opportunity to self-finance our growth. [electric vehicles]”Said Barra.

But GM The future of all electricity, It is investing in making more gasoline powered vehicles like full-size SUVs and pickups.
On Thursday, the company announced plans to invest up to $1 billion in its Oshawa, Ontario plant to build pickup trucks in early 2022. Plans for GM to employ 1,400 to 1,700 workers. The Oshawa plant was announced by GM in November 2018. To be closed, with Four american factories, Moving to cut costs.

“We have a full-size pickup plant around the clock to meet the very strong demand for Chevrolet Silverado and GMC Sierra in the US and Canada,” Barra said. “When the plant goes live in early 2022, the capacity to produce full-size pickups will increase significantly.”

stock GM (GM) News rose about 4% in noon trading.

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