On the Dash:
- General Motors hybrids will arrive in multiple segments, CEO Mary Barra told analysts Tuesday.
- Barra said the hybrids will not require additional capital spending or engineering.
- Dealers can expect hybrids in key segments, but models and timing remain unannounced.
General Motors (GM) is planning to offer hybrids across multiple segments of its lineup, CEO Mary Barra told analysts Tuesday on the automaker’s third-quarter earnings call. While GM has largely stayed out of the hybrid market in recent years, Bloomberg reported that demand grew and then spiked this year as fuel costs rose.
According to UBS analyst Joe Spak, Barra was asked whether hybrid work is underway and whether it requires additional investment. “From a hybrid perspective, we will have hybrids in our portfolio in multiple segments, the key segments that we participate,” Barra said on the call. She added that the hybrids won’t require additional capital spending or engineering.
Barra said much of today’s hybrid activity is in compact cars, midsize cars and minivans, three segments where GM doesn’t currently compete. Notably, GM sold roughly 12,000 cars in the U.S. during Q3, or 1.7% of the car market, according to its earnings release. She said the Equinox compact SUV is at full capacity even without a hybrid version. However, Barra didn’t say whether the automaker will launch more models or name them.
Mike Anderson, GM’s Vice President of Propulsion Engineering, told CNBC earlier this month that hybrids are part of the plan and that GM wants to deliver what customers want as quickly as it can. Additionally, industry forecaster AutoForecast Solutions expects GM plug-in hybrids to arrive between late 2027 and early 2028, yet the automaker hasn’t confirmed that window.
Rivals gain ground as fuel prices climb
As recently as January, Barra told Bloomberg Television that GM’s focus was on its internal combustion engine and EV portfolios. However, rivals Toyota, Hyundai and Honda have done swift business in hybrids since then. According to Bloomberg, GM CFO Paul Jacobson said in a CNBC interview Tuesday that the hybrid makers’ success is hard to ignore.
Further, Barra defended GM’s truck-heavy lineup when Bank of America analyst Alex Perry asked about higher diesel prices on the call. GM’s diesels are efficient enough that owning one cost less than owning a hybrid truck, even at the higher prices before the latest spike, she said. Barra said it’s too soon to know how long diesel prices will stay high, and that GM didn’t really see an effect on demand until a month or two ago.
Jacobson added on the call that higher oil and fuel prices could keep pushing EV adoption up, and that GM wants to be ready for that.
Q3 results and guidance
GM reported third-quarter revenue of $50.0 billion, up 2.9% from a year ago, and EBIT-adjusted earnings of $4.1 billion, up 21.6%. Net income attributable to stockholders was $3.3 billion, and adjusted earnings per share were $3.70. GM North America posted an EBIT-adjusted margin of 8.7%. Moreover, U.S. sales fell to 671,000 vehicles from 710,000 a year earlier, and market share slipped to 16.1% from 16.8%, according to the release.
GM narrowed its full-year EBIT-adjusted guidance to $14.5 billion to $15.5 billion from $14.0 billion to $16.0 billion. The board also approved a new $20 billion share repurchase authorization. Jacobson said commodity, logistics and DRAM costs will be a headwind of about $2 billion this year.
