December 3, 2022

Javier14mascherano

Born to perform

GM Sees Dip in Q1 Profits as New Vehicle Sales Struggle

3 min read

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General Motors saw its net and EBIT-adjusted income for the first quarter of 2022 come in slightly lower than the previous year’s results.

Barra at $7B EV announcement
GM Chair and CEO Mary Barra told shareholders the company had a “strong” first quarter in 2022.

She called it a “strong first quarter,” but clearly the auto company is still battling semiconductor and other material shortages hampering production of its most popular products. That’s showing up in severely reduced inventory on dealer lots, resulting in lower vehicle sales.

The company reported net income of $2.93 billion on revenue of $35.99 billion in Q1, which was down from the $3.02 billion in net income and $32.47 billion from the same period last year. The company’s EBIT-adjusted number was $4.04 billion, down from the $4.42 billion earned during the year-ago quarter.

The company’s net income margin was 8.2%, down from 9.3% last year and the adjusted margin came in a 11.2%, a drop from 13.6% a year ago.

Barra said the company is pushing to tackle the issues it — and almost all other U.S.-based automakers — are facing going forward.

The rest of the year

2022 Chevrolet Silverado LT
Barra said GM would be buoyed by its light-duty trucks, like the 2022 Chevrolet Silverado LT, in 2022.

“At GM, we rise to meet challenges,” she wrote in a letter to shareholders. “With strong demand for our vehicles, including our dramatically redesigned Chevrolet and GMC light-duty pickups launching now, our cost discipline and the progress of our growth plan, we are reaffirming our financial guidance for the calendar year.”

GM expects full-year 2022 net income in a range of $9.6 billion-$11.2 billion and is reaffirming its earnings guidance of EBIT-adjusted in a range of $13 billion-$15 billion. Full-year EPS-diluted of between $5.76 and $6.76, and EPS-diluted-adjusted of between $6.50 and $7.50.

The company tweaked the 2022 Chevy Silverado, looking to win back those who sharply criticized Silverado when the fourth-generation pickup hit market just three years ago — and, in the process, win back buyers who’ve been migrating to its archrival Ram.

While some of the updates are cosmetic, starting with a new grille design, the 2022 Chevrolet Silverado also gets more substantial updates, starting with an all-new off-road model, the ZR2. Two popular powertrain options are upgraded, as well, delivering more torque and towing capacity.

2023 Cadillac Lyriq
The company is focused on its transition to an all-electric line-up, including the recent rollout of the Cadillac Lyriq.

And, but for base “work” trucks, buyers will find significant upgrades in the interior, including more upscale materials and a switch to all-digital displays. The 2022 Silverado also gets a special version of General Motors’ hands-free Super Cruise technology.

Remaining focused on the shift to EVs

“Our confidence is strong as we accelerate our transformation, even in the face of a challenging macro environment,” Barra wrote.

The company is targeting to 1 million units of EV capacity by 2025, with production of 400,000 all-electric models annually “over the course” of the remainder of this year and all of 2023. That will include at least four new products, starting with the GMC Hummer Truck EV, which is already in production. The SUV model begins production next year.

The Cadillac Lyriq was next in the queue as it began rolling off the assembly line in Spring Hill, Tennessee last month. The Chevrolet Silverado EV, which was introduced at the Consumer Electronics Show in Las Vegas in January, is slated to begin production in early 2023. 

Those will be followed by the Chevy Blazer SS, beginning in mid-2023, and then followed by the company’s first sub-$30,000 EV, the Chevrolet Equinox. Also the Bolt is still on the roster.

“In North America, we expect to deliver record U.S. sales for the Bolt EV and Bolt EUV in 2022, even as we service customer vehicles now that production has resumed,” she wrote.

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