The new GMC truck will be on display on July 2, 2024 at Hanley’s Hilltop GMC’s sales lot in Richmond, California.
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General Motors It is set to report second-quarter revenues before Tuesday’s bell as investors see how President Donald Trump’s car rates will affect carmaker outcomes and how a full-year guidance update will affect it.
Automakers want tariff relief, but 25% collection and many auto parts on Trump’s imported vehicles remain in effect.
Amidst uncertainty, GM is trying to combat the risk of tariffs. Last month, the company announced it would invest $4 billion in several American plants, including moving or increasing production of two Mexican-produced vehicles to US plants. The company said last week it would move production of gas-powered SUVs and add pickup truck production to its home state in Michigan.
GM said in May that it believes it could ease at least 30% of the expected increase in tariffs, but its revenue guidance for 2025 reduced to include the $4 billion to $5 billion impact from automotive rates. The company said in the spring that its guidance took into account changes the Trump administration had made to tariffs. This includes reducing the “study” of industry tariffs for certain US parts.
GM CEO Mary Barra refused to say at the time whether the company planned to raise the price of the vehicle due to tariffs.
According to average estimates compiled by LSEG, here is what Wall Street expects:
Earnings per share: $2.44 Adjusted Recording: $46.4 billion
These results show a 3.3% decrease in revenues compared to a year ago and a 20.3% decrease in adjusted earnings per share. GM’s second quarter of 2024 included revenue of $47.97 billion, net income attributable to shareholders of $2.9 billion, and adjusted profits of interest and taxes of $4.44 billion.
The company’s full-year guidance, which was changed due to tariffs in May, includes adjusted profits before interest and taxes of between $100 billion and $12.5 billion.
GM’s annual forecast shows that net income attributable to shareholders has declined from $8.2 billion to $10.1 billion, and from $11.2 billion to $12.5 billion, while free car cash flows from $7.5 billion to $100 billion have fallen between $11 billion and $13 billion.
Investors also heard commentary on GM’s commitment to electric vehicles on Tuesday.
Trump’s new tax and spending bill, which he signed into law on July 4th, is set to end $7,500 tax credits for new electric vehicles and $4,000 credits for used EVs from September 30th.
As a result of the end of the tax credit, Barclays research notes last week predicted that the automotive industry would be slow to introduce EV models, while Deutsche Bank notes expected to take over EV sales from car manufacturers in the third quarter.
GM initially set a goal of offering EVS only by 2035, but has since said that slower than expected consumer demand will determine EV plans.
GM’s stock remains overweight with a price target of $56 per share, according to the average estimate compiled by FactSet.
This is developing news. Please update for additional updates.
