General Motors Co. in Detroit today reported third-quarter income of $4 billion and earnings before interest and taxes-adjusted of $5.3 billion driven by strong sales of crossovers, full-size pickups, and large SUVs.
Highlights of the automaker’s third-quarter results include:
- EPS-diluted of $2.78, and EPS-diluted-adjusted of $2.83.
- EPS-diluted-adjusted includes a $0.05 gain from Groupe PSA revaluations.
- Income of $4 billion, and EBIT-adjusted of $5.3 billion.
- EBIT-adjusted margin of 14.9 percent.
- Revenue of $35.5 billion.
- Automotive liquidity of $37.8 billion.
- Automotive operating cash flow of $9.9 billion and adjusted automotive free cash flow of $9.1 billion.
- GM North America EBIT-adjusted of $4.4 billion.
- GM Financial EBT-adjusted of $1.2 billion.
In North America, GM brought in $4.4 billion in the third quarter, compared to $3 billion a year ago. Excluding the negative $1 billion impact of the 2019 strike, EBIT- adj. improved primarily due to continued cost actions and disciplined incentives, GM says. GMNA margins were 15 percent.
“This year, and the third quarter, is a testament to GM’s resilience,” says Mary Barra, chairman and CEO of GM. “We entered the pandemic in a strong position and acted decisively to keep our teams safe, conserve cash, and preserve liquidity, all while keeping our critical product programs on track.”
The automaker’s sales in China in the period grew 12 percent year-over-year as the market continued its recovery. Buick and Cadillac increased 26 percent and 28 percent, respectively.
The Wuling Hong Guang MINI EV became the best-selling EV model in China, and Buick started sales of the VELITE 7 all-electric SUV and VELITE 6 plug-in hybrid electric vehicle in the third quarter. In the next five years, more than 40 percent of GM’s new models in China will be new energy vehicles.
“Sales in the U.S. and China are recovering faster than many people expected, and GM is benefiting from robust customer demand for our new vehicles and services, especially our full-size pickups and SUVs,” says John Stapleton, interim CFO at GM. “These strong fundamentals and the positive impact of our transformation and austerity measures are helping us to deliver solid earnings, generate significant cash and quickly repay the debt we incurred during the early days of the pandemic.”
GM says its U.S. sales improved sequentially each month within the quarter, driven by sales of crossovers, full-size pickups, and large SUVs. The Chevrolet Blazer posted its best quarter ever and the Cadillac XT6 was up 45 percent compared to last year. Despite tight inventory, GM’s large pickup trucks sold well, especially heavy-duty pickups.
Through the third quarter, GM’s large pickups gained 1.7 percentage points in retail market share, leading the segment with 37.5 percent share, according to J.D. Power. GM says its all-new full-size SUVs are in high demand; the Chevrolet Tahoe and Suburban, and GMC Yukon and Yukon XL gained three percentage points in retail segment share since launching in the second quarter, according to J.D. Power.
GM reports its automotive liquidity was above target, ending the quarter at $37.8 billion. GM repaid $5.2 billion of its revolving credit facilities during the third quarter, and an additional $3.9 billion in October.
The automaker expects to repay the balance by year-end while maintaining a strong cash balance. GM achieved its cost savings target of $4 billion since 2018, including $200 million in the quarter. The company expects to continue making progress on the target range of $4 billion to $4.5 billion through the end of the year.