General Motors (NYSE: GM) reported strong quarterly earnings for Q4 2023 today, but electric vehicle fans might be disappointed with the company’s outlook.
GM beat Q4 estimates on revenue by reporting $42.98 billion, better than the $39.53 billion consensus estimate. Additionally, its EPS was $1.24, beating an estimate of $1.16.
Shares spiked over 7 percent at around 10 a.m. Eastern.
However, EV enthusiasts might be disappointed with what GM said about its EV business, admitting that it has slowed and the company is unsure of what to think about it.
“It’s true the pace of EV growth has slowed,” CEO Mary Barra said, “which has created some uncertainty.”
Barra said she does expect GM to be profit positive by 2H 2024. Those projections are based on the current expectations for EV demand and production growth. GM still needs to see where things are as the year goes on, though.
General Motors sidesteps loss of EV tax credit to offer big discounts for customers
“We won’t get to low to single-digit profitability until 2025,” CFO Paul Jacobson said about EBIT EV margins. GM expects to sell at least 250,000 EVs this year, ditching the goal of building 400,000 units by mid-2024.
It seems GM will operate on a fluid basis, adjusting its strategy as the year goes on. Barra said that GM can adjust its production and be more flexible with other powertrains, especially hybrids, if necessary.
GM’s New EVs for 2024
Despite its tempering of expectations for EVs, GM will still launch six models this year:
- Chevrolet Blazer EV – Production started in Q4 and is currently ramping up
- Chevrolet Silverado EV RST – Up to 10,000-lbs towing capacity
- Chevrolet Equinox EV – Starting at just $34,995
- Cadillac Escalade IQ – 450-mile range estimated, Super Cruiser driver assistance
- Cadillac CELESTIQ – Handbuilt and ultra-luxurious
- GMC Sierra EV – Uncompromising pickup capability
What are Analysts Saying about GM
GM’s strong quarter had analysts bullish about 2024. Wedbush’s Dan Ives said:
“GM delivered strong results/better than expected 2024 guidance. This was an important quarter to help regain Street confidence that has been shaken the last few quarters with the EV vision in flux and Cruise black eye. GM said it would spend $1 billion less on Cruise than in 23.”
Despite the slacking EV growth, Ives seems encouraged by GM’s report.
Wedbush maintained its ‘Outperform’ rating on the stock and kept a $40 price target.
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