GM reports net income grew in 2023 despite strike
DETROIT — General Motors’ net income rose 12% last year despite losing more than $1 billion when many of its plants were shut down by a sixweek autoworkers’ strike. The company also announced that it will bring back some plug-in gas-electric hybrids as electric vehicle sales growth slows.
The Detroit automaker made just over $10 billion last year, up from $8.9 billion in 2022. Excluding one-time items, the company made $7.68 per share, easily surpassing the $7.57 projected on Wall Street, according to FactSet.
Full-year revenue was $171.84 billion, about 10% more than in 2022. That also beat estimates of $167.26 billion.
The company predicts a small improvement in earnings this year even as it plans for lower vehicle selling prices due to increased discounts.
Shares of General Motors Co. jumped 6.8% in midday trading Tuesday.
GM said it expects net income will improve a little this year, to a range of $9.8 billion to $11.2 billion. It expects adjusted earnings per share in a range of $8.50 to $9.50, compared with $7.68 last year.
Due to $12.3 billion in North American pretax profits, about 45,000 members of the United Auto Workers will get profitsharing checks of $12,250, the company said.
Chief Financial Officer Paul Jacobson told reporters that GM is preparing for a 2% to 2.5% average sales price drop on vehicles this year compared to last year as inventory grows amid high interest rates. GM has planned for price cuts for the past couple of years, but they haven’t materialized, he said.
“It’s not actually what we’re seeing in the market today,” Jacobson said, adding that average sale prices “are actually holding up very similar to where we saw the end of 2023.”
Prices are stable for both internal combustion and electric vehicles, he said, bucking industry trends. He said GM plans to keep a 50-to-60-day supply of vehicles at U.S. dealers, enough to supply demand but limit discounting.
That may be difficult with inventory from all automakers growing to 2.7 million at the end of last year, edging closer to prepandemic levels of around 3.5 million.
Without giving much detail, CEO Mary Barra said the company is bringing back some plug-in gas-electric hybrid models in the U.S., reversing a strategy to focus on electric vehicles. She told analysts on a conference call Tuesday that GM would resurrect the plug-in hybrid powertrains on selected vehicles in North America, in part to help comply with more stringent fuel economy requirements that will start in 2027 in the U.S.
Plug-in hybrids can go a relatively short distance on battery power before a gas-electric propulsion system kicks in.
GM, Barra said, is still committed to eliminating tailpipe emissions from light duty vehicles by 2035. “But in the interim, deploying plug-in technology in strategic segments will deliver some of the environmental benefits of EVs as the nation continues to build its charging infrastructure,” she said.