GM’s first quarter net income slides, but Barra says GM to hike production – Detroit Free Press
General Motors reported first-quarter earnings dipped slightly compared with its results a year ago as the industry faced ongoing supply chain issues that disrupted production, limiting supply.
But in the tight supply, high demand market, GM reported revenue gains. The company said it will work to secure leadership in pickups, electric vehicles and self-driving cars to drive future growth.
For the quarter, GM on Tuesday reported a net profit of $2.9 billion, nearly flat compared with $3 billion in the year-ago first quarter.
Its earnings before interest and taxes (EBIT) were down slightly to $4 billion compared with $4.4 billion a year ago. Net revenue rose to $36 billion compared with $32.5 billion.
In her regular letter to shareholders, GM CEO Mary Barra said the automaker rises to meet challenges.
“With strong demand for our vehicles, including our dramatically redesigned Chevrolet and GMC light-duty pickups launching now, our cost discipline and the progress of our growth plan, we are reaffirming our financial guidance for the calendar year,” Barra said.
GM expects full-year 2022 net income of $9.6 billion to $11.2 billion and an EBIT-adjusted range of $13 billion to $15 billion.
“Launching more EVs faster is the catalyst for growth, and we are accelerating our volumes, growing to 1 million units of EV capacity in North America by the end of 2025, and expanding from there,” Barra wrote. “In North America alone, we target production of 400,000 all-electric vehicles over the course of 2022 and 2023.”
When asked how GM will meet those EV production targets given the ongoing disruptions to the supply chain including the global shortage of semiconductor chips, Barra told reporters the company is “working across all aspects to make sure the vehicles are high quality and ready and that we can work across our supply base.”
Barra said GM has established “strategic, long-term relationships” with suppliers at all levels and is sourcing as much as possible from North America.
In a call with analysts, Barra said GM will now tie executive compensation to its EV acceleration targets. The company has added metrics for EV volume in North America, EV launch timing, and EV launch quality to existing financial measures. The metrics are in place now, and they will appear in GM’s proxy statement, which GM files on Friday.
Ford Motor Co. reports its earnings Wednesday and Stellantis reports its shipments and revenues on May 5 and its complete earnings at midyear.
GM to build more
Despite the volatility in the supply of semiconductor chips, used in a variety of vehicle parts, Barra said GM is well positioned to build 25% to 30% more vehicles this year than it did in 2021.
“There is still volatility in chips and we continue to work on it on a daily basis,” Barra said. “We’ve seen an improvement in the first quarter over the fourth quarter. We think there’ll be a strong chip supply in the second half of the year. We’re working deeper into the supply chain &…….