GM looks for a road out of Tesla's shadow | Inquirer Business

GM looks for a road out of Tesla’s shadow

/ 08:57 AM January 30, 2024

GM looks for a road out of Tesla's shadow

Vehicles of automobile brands belonging to General Motors Company are seen at a car dealership in Queens, New York, U.S., Nov 16, 2021. REUTERS/Andrew Kelly/File photo

DETROIT  – General Motors CEO Mary Barra on Tuesday will face the challenge of convincing investors the No. 1 U.S. automaker will not be stuck in the same slow lane this year as Tesla and other rivals.

Tesla’s warning last week that it expected a year of slow growth and continued pricing pressure weighed on other automakers’ shares.


GM has already pared back its 2023 profit guidance and told investors its new contract in the U.S. with the United Auto Workers union will add $9.3 billion in costs.


READ: Tesla erases $80B in valuation after Musk’s sales warning

A $10 billion share buyback and a 33-percent increase in the dividend announced in late November lifted the company’s share price off a three-year low. But GM shares are down about 19 percent from their 52-week high and flat for 2024 so far.

Barra’s outlook for growth in North America and China, GM‘s two main markets, will be just one issue on Tuesday. Forecasters are calling for single-digit percentage growth in U.S. vehicle demand and increasing downward pressure on prices.

In China, GM sales fell 8.9 percent in 2023 from a year earlier, with demand for the Buick and Chevrolet brands falling by nearly 20 percent and 15 percent respectively as domestic Chinese automakers gain market share.

Analysts will also focus on the prospects for GM‘s electric vehicle and technology bets.

READ: Driverless taxis gain ground in San Francisco


GM disclosed last week that its Cruise robotaxi unit is under investigation by the U.S. Justice, the Securities and Exchange Commission and other regulators. Cruise has halted operations after one of its cars dragged a pedestrian down a San Francisco street.

Barra has said Cruise technology could generate $50 billion a year in revenue by 2030, but the unit’s effort to ramp up revenue-generating rides is in limbo.

Growth in U.S. demand for EVs has shown signs of slowing. Ford has cut production of its F-150 Lightning electric pickup to one shift, and added a shift of production at a factory that builds combustion Bronco SUVs.

READ: GM sees $9.3-B hit from labor deals, outlines $10-B buyback

Despite the uncertain market outlook, GM is trying to accelerate deliveries of its new generation of EVs in North America after struggling with Ultium battery pack production bottlenecks last year.

GM sold just 12,859 of its Ultium EVs in 2023. Its best-selling EV, the Chevrolet Bolt, has gone out of production.

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Barra told investors in October that Ultium vehicle production more than doubled in the third quarter.

TAGS: gm, projections, Tesla

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