{"id":316536,"date":"2021-08-04T21:19:07","date_gmt":"2021-08-04T18:19:07","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/gm-posts-2-8b-profit-but-cautious-tone-sinks-share-price\/"},"modified":"2021-08-04T21:19:07","modified_gmt":"2021-08-04T18:19:07","slug":"gm-posts-2-8b-profit-but-cautious-tone-sinks-share-price","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/gm-posts-2-8b-profit-but-cautious-tone-sinks-share-price\/","title":{"rendered":"#GM posts $2.8B profit, but cautious tone sinks share price"},"content":{"rendered":"

“#GM posts $2.8B profit, but cautious tone sinks share price<\/strong>”<\/p>\n

\n

General<\/a> Motors posted a healthy $2.8 billion second-quarter profit Wednesday, but its cautious outlook for the rest of the year spooked investors.<\/p>\n

The Detroit automaker made the strong profit despite a global shortage of computer chips that have forced it and other companies to temporarily close factories.<\/p>\n

While GM raised its outlook for the year, it also cautioned about high commodity prices and lower production due to the chip shortage, and it warned that the highly contagious delta variant of the coronavirus could hamper its supply chain.<\/p>\n

The cautious tone rattled investors, who pushed GM shares down more than 8 percent in midday trading.<\/p>\n

Chief Financial Officer Paul Jacobson predicted that GM would produce 100,000 fewer vehicles in the second half of the year compared with the first, even as other companies forecast improvements in semiconductor production. GM said it managed the shortage well and was able to divert scarce chips to factories that make higher profit pickup trucks and large SUVs.<\/p>\n

But Edward Jones Industrials analyst Jeff Windau said investors are building some uncertainty into GM\u2019s stock price after the company forecast $3.5 billion to $4.5 billion worth of increased costs in the back half of the year.<\/p>\n

\u201cObviously there\u2019s some shutdowns, and there\u2019s just concerns with how things are evolving,\u201d Windau said. \u201cExpectations have been rising over the last couple of months. This just kind of comes back and potentially resets the bar a little bit.\u201d<\/p>\n

\n
\"pickup
GM said pickup truck plants in Flint, Michigan (seen), as well as one in Mexico and Indiana, will be closed next week due to the chip shortage. <\/figcaption>
Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n

On Tuesday, GM announced that pickup truck plants in Flint, Michigan; Silao, Mexico; and Fort Wayne, Indiana; would be closed next week due to the chip shortage. Production is to resume on Aug. 16. But factories in Tennessee and Mexico that make cars and SUVs that were down since July 19 will come back on line Monday.<\/p>\n

Even with the caution, GM told the same story as competitors Ford, Stellantis and others reporting strong profits, saying that high prices and healthy demand for expensive pickup trucks and luxury SUVs overcame inventory shortages.<\/p>\n

GM boosted its net income guidance for the full year to $7.7 billion and $9.2 billion, and pretax earnings to a range of $11.5 billion to $13.5 billion from $10 billion to $11 billion.<\/p>\n

\n
\"price
GM saw its share price fall more than 8 percent in midday trading.<\/figcaption>
Yahoo! Finance<\/span><\/figcaption><\/figure>\n<\/div>\n

Executives said Wednesday that they expect tight inventory and high prices to continue through the year as the chip shortage lingers into 2022.<\/p>\n

Yet CEO Mary Barra warned that the fast-spreading coronavirus delta variant could cause supply chain problems down the road. The company also has plans to handle future shortages by collaborating with semiconductor manufacturers, she said.<\/p>\n

\u201cThere is still more variability than I\u2019d like to see,\u201d Barra said. \u201cThis is something we will work our way out of, and it won\u2019t be an issue as we move forward over a little bit longer period of time.\u201d<\/p>\n

\n
\"Marry
GM CEO Mary Barra warned that the fast-spreading coronavirus delta variant could cause supply chain problems down the road for the automotive giant.<\/figcaption>
Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n

The average GM vehicle sold for nearly $44,000 from April through June, the company said, and it was up nearly $3,000 over that in July.<\/p>\n

Jacobson said the high prices at present come from high demand for more higher priced trucks and SUVs with a \u201cvery rich mix\u201d of options being purchased by consumers. Barra said the prices will subside a bit as inventory grows, but she still expects them to be strong as GM adds electric vehicles to its lineup.<\/p>\n

Excluding one-time items, GM made $1.97 per share, beating Wall Street estimates of $1.82. Revenue was $34.2 billion, which also exceeded analysts\u2019 estimates of $29.92 billion, according to FactSet.<\/p>\n

\n
\"Chevrolet
An $800 million charge to fix a battery fire problem in older Chevrolet Bolts lowered GM\u2019s profit.<\/figcaption>
Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n

The profit would have been $1.3 billion higher if not for recall costs, including $800 million to fix a battery fire problem in older Chevrolet Bolt electric vehicles, the company said.<\/p>\n

Barra said GM had a little more than 200,000 vehicles in stock, enough to supply 25 days of consumer demand. That\u2019s far short of the normal inventory. Automakers like to have around a 60-day supply on dealer lots for customers to pick from.<\/p>\n

On Tuesday, a task force of Detroit auto companies and the United Auto Workers announced that factory workers would be required to wear masks again due to the delta variant. Asked if GM would require employees to be vaccinated, Barra hinted that may be coming. \u201cWe are evaluating multiple choices that we can make, but our intent is always to keep our employees and our customers safe,\u201d she said.<\/p>\n

\n
\"Billboards
GM\u2019s said the automaker had a little more than 200,000 vehicles in stock, far short of the normal inventory. <\/figcaption>
Xinhua News<\/a> Agency\/Getty Images<\/span><\/figcaption><\/figure>\n<\/div>\n

GM said it produced about 200,000 more vehicles in the first half of the year than it did during the same period in 2020, largely because factories were shut down last year as the pandemic grew.<\/p>\n

Yet the consulting firm LMC Automotive estimated that GM production from April through June was down 38% from the same quarter in 2019, the last comparable quarter of normal production.<\/p>\n

Jacobson said the semiconductor shortage should start to ease in the fourth quarter, so fourth-quarter production will be higher than the third. \u201cYou can see light at the end of the tunnel as we\u2019re getting toward that,\u201d he said.<\/p>\n

Barra also announced two new electric vehicles coming as part of GM\u2019s plan to introduce more than 30 globally by 2025. She said the Chevrolet brand will roll out a full-size electric cargo van, and GM also will sell a medium-duty electric or hydrogen fuel cell truck platform that can be used for service and utility vehicles such as school buses, bucket trucks and wreckers.\n <\/p><\/div>\n

If you liked the article, do not forget to share it with your friends. Follow us on\u00a0Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n

\n

For forums sites go to Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n

\n

If you want to read more News articles, you can visit our News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n

Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

“#GM posts $2.8B profit, but cautious tone sinks share price” General Motors posted a healthy $2.8 billion second-quarter profit Wednesday, but its cautious outlook for the rest of the year spooked investors. The Detroit automaker made the strong profit despite a global shortage of computer chips that have forced it and other companies to temporarily…<\/p>\n","protected":false},"author":1,"featured_media":316537,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2021\/08\/gm-posts-profit-jump.jpg?quality=90&strip=all&w=1200","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[113415,70237,72550],"class_list":["post-316536","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-8-4-21","tag-corporate-earnings","tag-general-motors"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/316536","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=316536"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/316536\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/316537"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=316536"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=316536"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=316536"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}