Despite possible headwinds in the economy and sales, General Motors (GM) exceeded Wall Street’s projections for both its top and bottom lines in the fourth quarter and is predicting another successful year.
The automaker’s more optimistic outlook is due to its belief that its major issues for 2023 are behind it rather than an anticipated improvement in sales both domestically and internationally.
On January 30, the Detroit-based automaker said that its adjusted earnings before interest and taxes for the entire year reached $12.4 billion, surpassing GM’s November estimate of up to $12.7 billion. Additionally, GM estimates its adjusted EBIT to be between $12 billion and $14 billion for the current year. Less than the record $14.5 billion set in 2022.
CEO Mary Barra announced during a conference call with investors that GM plans to sell at least 250,000 EVs this year, reintroduce hybrids to its lineup, and save $2 billion in expenses. She said GM would still consider outside investment for its controversial Cruise self-driving project.
Moreover, GM expects to spend roughly $1 billion less on Cruise this year, estimating a $1.7 billion outflow from its EV business, and does not expect to face another strike, which cost $1.1 billion last year.
After a few setbacks, GM stated that EV production would pick up this year. The company is also moving forward by introducing new battery-powered models, such as all-electric versions of its full-size GMC Sierra Denali SUV and compact crossover Chevrolet Equinox.
Barra admitted in her letter that the slowdown in the pace of EV growth has created uncertainty. We think that our core models’ increased production will strengthen our competitive position throughout the year.” By late 2024, she continued that GM aspires to achieve “Variable profit positive” status for its EV lineup.