On July 25th, General Motors announced its financial results for the second quarter and first half of the year.

General Motors' Q2 net profit increased by 52% and will increase cost reduction efforts

Image source: General Motors

In the second quarter of this year, General Motors' revenue was $44.7 billion, higher than the widely expected $42.64 billion of Reinitiv analysts; The adjusted Earnings before interest and taxes was US $3.2 billion, up 38% year on year; The net profit attributable to shareholders was $2.6 billion, a significant increase of 52% year-on-year. It is worth mentioning that this result includes $792 million in expenses related to the Chevrolet Bolt recall in 2021.

In the first half of this year, General Motors achieved a revenue of $84.73 billion, an increase of 18.1% year-on-year; The adjusted Earnings before interest and taxes was US $7.037 billion, up 10.2% year on year; The net profit attributable to shareholders was $4.96 billion, achieving a year-on-year increase of 7.1%.

Thanks to strong demand and strict pricing, General Motors has once again raised its full-year performance expectations. GM currently expects that the adjusted Earnings before interest and taxes this year will be between 12 billion and 14 billion dollars, 1 billion dollars higher than the forecast in April. In addition, General Motors has raised its net profit forecast for this year to $9.3 billion to $10.7 billion from the previous $8.4 billion to $9.9 billion. GM also raised its free cash flow forecast for its automotive business by $1.5 billion to a range of $7 billion to $9 billion.

General Motors CEO Mary Bora stated in a letter to shareholders, "Due to the incredible customer response to our new trucks and SUVs, as well as the strong execution of our business plan by the General Motors team, dealers, and suppliers, we are building positive momentum

GM also said that it was stepping up its efforts to cut costs, and currently expected to cut Fixed cost by $3 billion in the next two years, higher than the original plan of $2 billion. However, General Motors Chief Financial Officer Paul Jacobson emphasized that the company's more aggressive cost reduction measures will not include any additional layoff plans. At the beginning of this year, General Motors bought out 5000 salaried employees.

Bora stated that General Motors is implementing a "win with simplicity" strategy that will reduce order complexity, supplier costs, and vehicle manufacturing mix. For example, by bundling the functions and options of electric vehicles and internal combustion engines, General Motors plans to reduce the interior by 50%.

In terms of electric vehicles, Bora revealed that General Motors achieved its goal of producing 50000 electric vehicles in the first half of the year and is expected to produce "approximately 100000 vehicles" in the second half of this year. In addition, General Motors will continue to strive to achieve its goal of producing a total of 400000 electric vehicles from 2022 to mid-2024.

This article is reprinted from Gaishi Automotive Information Network