GM Q1 earnings: Net income down 2.7% to US$2.9 billion as revenue rises 11%

DETROIT — General Motors on Tuesday reported first-quarter net income of $2.9 billion (all figures in USD), a 2.7 per cent decrease from a year earlier despite a double-digit revenue increase.

GM's global earnings before interest and taxes declined 8.4 per cent to $4 billion, while its North American profit equaled the $3.1 billion it earned in the first quarter of 2021. Global revenue rose 11 per cent to nearly $36 billion.

CEO Mary Barra, in a letter to shareholders, reaffirmed the company's 2022 adjusted earnings guidance of $13 billion to $15 billion. GM expects net income of $9.6 billion to $11.2 billion for the year.

“Our confidence is strong as we accelerate our transformation, even in the face of a challenging macro environment,” Barra said in the letter. “Our biggest growth opportunity in North America is in electric trucks. We’ve led the full-size pickup segment for two consecutive years, and we will lead the EV truck market as well.”

Chevrolet has logged about 140,000 reservations for the Silverado EV, set to launch next year, and continues to take additional reservations, she said. GMC has taken more than 70,000 reservations for the Hummer pickup and SUV combined.

GM plans to have 1 million units of EV capacity in North America by the end of 2025 and is targeting production of 400,000 EVs in this year and next year. The automaker aims to have an all-electric lineup by 2035.

Barra told reporters Tuesday that GM’s EV capacity is supported by early investments to build an EV value chain, along with the automaker’s proprietary Ultium battery platform.

GM will begin to consider EV volume, rollout timing and quality as it sets long-term compensation for executives, Barra said. The new measurement will be in GM’s 2021 proxy statement, which will be available Friday.

GM continues to work through the global microchip shortage, she said, and the automaker expects production this year to exceed 2021 production levels by 25-30 per cent.

“We are working deep into the tiered supply base for chips to make sure that, to the extent that we can, we control our own destiny,” Barra said.

GM's first-quarter U.S. light-vehicle sales fell 20 per cent, with all four brands posting declines largely because of supply chain disruptions. The automaker expects stronger sales in the second half of the year, Steve Carlisle, president of GM North America, said this month.

Despite the overall sales decline, GM began to expand its fleet mix. Fleet sales made up 24 per cent of total sales in the first quarter, compared with only 17 per cent of GM's total sales a year earlier. In the first quarter of 2020, before the pandemic significantly impacted the industry, fleet accounted for 28 per cent of all GM deliveries.

GM earned $328 million from international operations, up 6.5 per cent from a year earlier.

China equity income fell 24 per cent to $234 million from $308 million a year earlier.

Earnings from GM Financial increased to $1.3 billion, up from $1.2 billion a year earlier.