GM is on the rise—but for now, EVs are holding it back, not leading the charge

Fortune04-25

Legacy automaker General Motors reported strong profits Tuesday, despite lagging sales in China and price cuts to some of its models. But beneath the surface, the automaker's strong financial ...

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But beneath the surface, the automaker's strong financial ...</p>\n\n<a href=\"https://finance.yahoo.com/news/gm-rise-now-evs-holding-184253554.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>GM is on the rise—but for now, EVs are holding it back, not leading the charge</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nGM is on the rise—but for now, EVs are holding it back, not leading the charge\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-04-25 02:42 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/gm-rise-now-evs-holding-184253554.html><strong>Fortune</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Legacy automaker General Motors reported strong profits Tuesday, despite lagging sales in China and price cuts to some of its models. But beneath the surface, the automaker's strong financial ...</p>\n\n<a href=\"https://finance.yahoo.com/news/gm-rise-now-evs-holding-184253554.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4585","symbol_name":"ETF&股票定投概念","start_time":0,"source_url":"https://finance.yahoo.com/news/gm-rise-now-evs-holding-184253554.html","article_id":"2430496039","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/0HDWmKzJusFzxhi_jsr0XA--~B/aD0xNjgyO3c9MjA0ODthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en/fortune_175/9317a95301e00db6daf754cbf65d27cb"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2430496039","pubTimestamp":1713984173,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Legacy automaker General Motors reported strong profits Tuesday, despite lagging sales in China and price cuts to some of its models. But beneath the surface, the automaker's strong financial performance is powered by gas: GM’s quarterly gains were led by its popular SUVs and gas-powered car lines, while producing EVs continues to lose the company money.GM’s stock went on a hot streak last quarter, buoyed in part by falling raw materials prices for its EV batteries. Share prices peaked at $45 in late March, up from a low of $27 last November. Its stock surged another 6.5% following the earnings release.GM’s EV project does show promising signs, though. Its production costs have declined, in part because bets on in-house battery manufacturing are finally paying off: Barra said GM tripled its battery production in the last six months, and GM said in its quarterly report that it plans to spend roughly $11 billion more on battery manu","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4585":"ETF&股票定投概念","LU0208291251.USD":"FRANKLIN MUTUAL U.S. VALUE \"A\" (USD) INC","BK4555":"新能源车","BK4566":"资本集团","GM":"通用汽车","BK4559":"巴菲特持仓","BK4588":"碎股","LU0320765489.SGD":"FTIF - Franklin Mutual US Value A Acc SGD","LU0648000940.SGD":"Natixis Harris Associates Global Equity RA SGD","LU0130102774.USD":"Natixis Harris Associates US Equity RA USD","LU0070302665.USD":"FRANKLIN MUTUAL U.S. VALUE \"A\" (USD) ACC","BK4574":"无人驾驶","LU0648001328.SGD":"Natixis Harris Associates US Equity RA SGD","BK4561":"索罗斯持仓","LU0130103400.USD":"Natixis Harris Associates Global Equity RA USD","LU0006061336.USD":"Blackrock US Small and MidCap Opportunities A2 USD","LU1201861165.SGD":"Natixis Harris Associates Global Equity PA SGD","BK4099":"汽车制造商","LU1201861249.SGD":"Natixis Harris Associates US Equity PA SGD-H","LU0211331839.USD":"FRANKLIN MUTUAL GLB DISCOVERY \"A\" (USD) ACC","LU0980610538.SGD":"Natixis Harris Associates US Equity RA SGD-H"},"translate_title":"通用汽车正在崛起——但就目前而言，电动汽车阻碍了它的发展，而不是引领潮流","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"GM":1},"content_text":"Legacy automaker General Motors reported strong profits Tuesday, despite lagging sales in China and price cuts to some of its models. But beneath the surface, the automaker's strong financial performance is powered by gas: GM’s quarterly gains were led by its popular SUVs and gas-powered car lines, while producing EVs continues to lose the company money. \nGM’s stock went on a hot streak last quarter, buoyed in part by falling raw materials prices for its EV batteries. Share prices peaked at $45 in late March, up from a low of $27 last November. Its stock surged another 6.5% following the earnings release. \nThe strategy that delivered GM’s strong financials represents a departure from the “all-in” EV strategy the company has been pushing for years. GM’s earnings are a win, but underline that the company will have to solve the problem of EV profitability to keep the ball rolling—a hurdle GM representatives say they’re on the verge of clearing.\n“There's no denying it: GM had a nice quarter,” wrote Piper Sandler analyst Alex Potter in a note issued after the earnings release. “However, as always, there's a caveat. GM's 2024 guidance… implies significant margin degradation in [the second half of 2024], due to rising EV sales. Nobody really knows how well (or how poorly) the EV launch will go.”\nGM’s EV rollout has faced a bumpy road, in line with the rest of the industry. GM has been one of the more aggressive legacy automakers when it comes to EV strategy, committing to phase out all of its gas-powered vehicles by 2035 and spending billions on new EV production capacity. But, along with its peers, it’s faced challenges: Its EV production numbers have routinely fallen below expectations, and it has yet to turn a profit on its electric models.\nEVs were in the backseat Tuesday, though. GM beat analysts’ expectations and raised its profit projections by half a billion dollars, to a target range of $12.5–$14.5 billion, largely off the back of its bread-and-butter gas-vehicle line. GM sold 3% more Chevrolet and GMC pickup trucks than a year prior, CEO Mary Barra told analysts in a call following the earnings release. In an SEC disclosure, GM cited strong sales of trucks and SUVs for generating increases in net sales and revenue.\nGM doesn’t specifically report the financial results of its EV line, but CFO Paul Jacobson said that the company continues to lose money on its electric cars. It, along with other automakers, has struggled to solve the puzzle of making EVs affordable for average consumers and profitable at scale. CEO Barra said that “EV adoption in luxury segments is higher and more resilient than in the broader market.”\nGM’s EV project does show promising signs, though. Its production costs have declined, in part because bets on in-house battery manufacturing are finally paying off: Barra said GM tripled its battery production in the last six months, and GM said in its quarterly report that it plans to spend roughly $11 billion more on battery manufacturing this year. (Falling commodity prices for lithium, a key component in EV batteries, have also provided a tailwind.)\nFurther, GM is bullish on EVs starting to make the company money, not lose it—potentially as soon as this year. GM spokesperson Jim Cain told Fortune the company expects its North American EV vertical to be profit-positive by the end of this year, largely due to increases in battery and overall vehicle production. \n“We feel pretty good about that… When we improve the profit margins, the EV portfolio becomes less of a drag overall,” Cain said. “We're in a process of rapidly scaling. We think we can potentially get to 200,000 to 300,000 units of EV production this year.”\nSelling more affordable EVs will be a priority for GM: The current market is dominated by expensive luxury offerings that remain out of reach for many consumers. Tax credits from the Inflation Reduction Act are helping, but Barra said GM expects to start rolling out low-price models such as a new Chevy Bolt EV late next year.\n“The next-generation Ultium-based Chevrolet Bolt EV is another,” Barra told analysts. “It's a profitable and capital-efficient program that will deliver one of the most affordable electric vehicles around when it arrives in late 2025.”\nTo an extent, the auto industry’s EV future is a shotgun marriage: When it comes to phasing out ICE cars and producing more electric units, the industry doesn’t have a choice. New federal rules require carmakers to dramatically reduce their emissions by 2032, effectively forcing them to switch most of their production to EVs. (GM is one of multiple automakers that has made internal commitments to transition its fleet to electric as fast as or faster than what the government is requiring.) That means GM and other automakers can only coast on profits from gas-powered vehicles for so long.\n“Even with the recent decline in battery raw material costs, EV profitability is challenging, particularly with new pricing pressure,” Wells Fargo analyst Colin Langan wrote in a note following GM’s earnings release. “However, US fuel economy regulations will likely force automakers to sell EVs to meet targets.”\nThis story was originally featured on Fortune.com","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2430496039"}