GM boosts outlook as sales in US fuel strong first quarter
April 25, 2023 -DETROIT (AP) — Strong U.S. sales helped General Motors increase its first-quarter net profit 19% over a year ago, leading the company to raise its full-year earnings guidance on expectations that people will keep buying new vehicles.
The Detroit automaker said Tuesday that its average U.S. vehicle price dropped about $500 for the quarter to $50,263 as the supply situation for GM improved, and it expects that to remain flat through the year as consumer demand remains surprisingly strong. It expects profits to increase because sales to dealers should rise 5% to 10% over last year despite high interest rates and inflation.
Chief Financial Officer Paul Jacobson wouldn’t make a prediction about a recession this year, but he forecast robust demand for GM through December.
“Overall, April remains really strong for us,” he said. “So we’re confident we’ll be able to hit this higher guidance.”
GM made $2.37 billion from January through March, up from $1.99 billion in the previous year.
Excluding a $900 million charge to pay severance packages to about 5,000 white-collar workers who took buyouts during the quarter, GM made $2.21 per share, soundly beating analyst estimates of $1.72, according to FactSet.
Revenue for the quarter came in just shy of $40 billion, up 11% from a year ago and beating projections for $38.55 billion.