GM, Stellantis report strong Q1 results despite production issues

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GM and Stellantis released first-quarter financial results on Wednesday, touting sales of their profitable trucks and SUVs, despite production disruptions that could continue into 2022.

GM posted better-than-expected first-quarter earnings despite a global semiconductor chip shortage as it kept costs low and focused on high-margin pickup trucks and SUVs, and said it expected pre-tax profit on the market. would be at the highest level all year round. end of his prediction.

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“The speed and agility of our team are central as we move from managing a pandemic to managing the global semiconductor shortage,” said Chief Executive Mary Barra in a letter to shareholders. “This remains a challenging period for the company as we come out of 2020.”

Barra added that the “supply chain and manufacturing teams of the No. 1 US automaker are maximizing the production of high-demand vehicles with capacity constraints”.

GM reiterated its full-year 2021 earnings expectations, saying, “based on what we know today,” the results will be at the top end of the adjusted pre-tax profit of $ 10 billion to $ 11 billion it previously forecast.

The company held on to previous forecasts that the chip shortage could reduce $ 1.5 billion to $ 2 billion from this year’s earnings.

Stellantis said on Wednesday it expects the deficit to take a bigger bite out of production in the second quarter and warned the disruption could last until 2022. %.

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Ford said last week that it expects vehicle production to be cut in half by the deficit in the second quarter.

During the shortage, GM prioritized its highest-profit cars, including the Chevrolet Silverado and GMC pickups.

Thanks to high consumer demand that has driven up prices, the focus on those high-margin models contributed $ 3.2 billion to GM’s first-quarter profit before tax.

GM posted net income of $ 3 billion, or $ 2.03 per share, in the first quarter, compared to $ 294 million or 17 cents a share a year earlier. Excluding items, the company earned $ 2.25 per share, well above analyst expectations of $ 1.04 per share.

Sales in the quarter decreased slightly from $ 32.7 billion to $ 32.5 billion. Analysts had expected revenue to be flat at $ 32.7 billion.

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