General Motors Has Bucked the Downturn in the Broader Automotive Sector — And Could Be Heading for Record Revenues and Profits Thanks to EVs
You can drive fast and far, but if you’re an American automaker, there have been few places to find peace since the end of the COVID-19 pandemic. Automakers like Ford, Tesla, and Stellantis have had their tires stuck in a muddy slush of waning consumer demand, weaker pricing power, and high interest rates — leading to warnings for investors. However, while most domestic automakers have spent the year in the red, there’s one that hasn’t…
Better in general: As other companies pull out aggressive discounts and rebates to sell vehicles, General Motors ($GM) has maintained stable pricing — bucking the broader downturn in the automotive market this year. As a result, the iconic automotive brand’s revenues have hit record levels, with profits inching closer to pandemic metrics. is up 37% year-to-date, compared to the Dow Jones US Auto Manufacturers Index, which is down 10%. A few more strong quarters could have the automotive powerhouse angling for new record highs.
- In the June quarter, GM’s revenues grew 7% to $47.97B, surpassing its previous quarterly record of $44.7B from Q2 2023.
- Over the past 12 months, GM’s net income has also advanced toward its pandemic records, with profits exceeding $11B.
Betting on the Battery
Last quarter, GM upgraded its full-year earnings outlook due to the strong performance of its traditional combustion engine vehicles and SUVs. However, to fully surpass its pandemic performance, GM must improve its unprofitable electric vehicle business, which it remains committed to despite political and social headwinds.
- At the start of the year, GM planned to double its EV production capacity, but by mid-year, the company dismissed a critical milestone in response to a downturn in the EV market.
- Regardless, GM CEO Mary Barra has reiterated that the resilient industry leader is “all in” on EVs — and says it will finally post a “positive variable profit” from its EV business in the second half of the year.
Lith-me have it: Despite challenges in China’s EV market, which Barra called a “race to the bottom,” GM is doubling down on its EV strategy. After delaying a payment earlier this year, GM announced a $625M investment into Thacker Pass, one of America’s largest up-and-coming lithium mining projects, led by Lithium Americas. With this 38% stake, GM hopes to secure cheaper battery materials and a supply that will last for decades.
