GM quarterly profit jumps 16% as sales rebound late in 2022
DETROIT (AP) — Rising factory output led to strong U.S. sales at the end of last year, pushing General Motors' fourth-quarter net income up 16% over the same period a year ago.
The Detroit automaker made $1.99 billion from October through December, or an adjusted $2.12 per share, easily beating Wall Street per-share projections for $1.69, according to a poll of industry analysts by FactSet.
Quarterly revenue rose 28% to $43.1 billion, the company said, also beating estimates for $39.96 billion.
Shares of General Motors Co. jumped 4.6% before the opening bell Tuesday.
GM made record pretax income of $14.47 billion, the high end of its guidance of $13.5 billion to $14.5 billion. About 42,000 hourly auto workers will get profit-sharing checks of roughly $12,750, up from $10,250 in 2021. The profit sharing will cost GM about $500 million.
The company also announced that it will invest $650 million in Lithium Americas to jointly develop the Thacker Pass lithium mine in Nevada. Lithium is a key element in electric vehicle batteries, and GM says Thacker Pass is the largest known source of lithium in the U.S. and the third largest in the world. GM has plans to produce 1 million EVs per year by 2025.
GM's performance came against the backdrop of a slowing economy due to interest rate increases from the Federal Reserve. The Fed's key rate, which affects many consumer and business loans, is now in a range of 4.25% to 4.5%, up from near zero last March.
GM, like other automakers, had trouble keeping its factories running at full output during 2022, but the industry and the company started showing signs of recovery late in the year.
GM sold 2.27 million vehicles for the year, up 2.5% over 2021. But fourth-quarter sales were up 41% to more than 623,000. By the end of the year the supply of vehicles on dealer lots had improved 14% to almost 411,000.
Experts don't expect a return to normal vehicle supplies until sometime next year.
For the full year, GM posted net earnings to shareholders of $9.93 billion, down about 1% from 2021. That beat analysts' estimates of $9.95 billion.
GM said it expects full year net income this year in a range of $8.7 billion to $10.1 billion. The forecast for adjusted pretax income is $10.5 billion to $12.5 billion.