G.M. Posts Solid Profit as It Pushes to Take On Tesla in E.V.s
General Motors on Tuesday reported solid profits for 2022, after overcoming the computer chip shortages and softening demand that has slowed much of the auto industry last year.
The company reported $9.9 billion in net income, slightly below the total from the year before, while revenue rose 23 percent to $157 billion. It sold 3.6 million vehicles globally, up from 2.9 million in 2022.
“Our team rose to every challenge that was thrown at them in 2022,” G.M.’s chief executive, Mary T. Barra, said in a conference call.
In the fourth quarter, when rising interest rates began to slow sales of new cars and trucks, G.M. generated $2 billion in profit, an increase of 15 percent from a year earlier. Revenue rose 28 percent to $43 billion. Vehicle sales increased 30 percent to 967,000.
G.M. shares rose more than 8 percent in trading on Tuesday, closing above $39.
The automaker forecast that profit in 2023 will be $8.7 billion to $10.1 billion. “We expect that our momentum will help us deliver strong results once again in 2023,” Ms. Barra said.
She also said G.M. would seek to cut costs by about $2 billion and expected to reduce its work force through attrition. “We are not planning layoffs,” she said.
In electric vehicles, G.M. has been gearing up to compete head-on with Tesla, the leader. G.M. said that it expected to produce about 400,000 electric vehicles from 2022 through the first half of 2024, and that it would be capable of annual E.V. production of more than one million in North America in 2025.
A new battery plant in Ohio began production in August, and a second battery plant is to open in Tennessee this year. The company has started selling some high-end electric vehicles using battery packs made in Ohio, and it expects its E.V. sales to increase this year as it adds more affordable models, like an electric Chevrolet Silverado pickup truck and electric Chevrolet Equinox and Blazer sport utility vehicles.
All told, G.M. should have nine electric models available in the United States by the end of the year, Ms. Barra said.
To support its E.V. push, G.M. announced Tuesday, it is investing $650 million in a mining company, Lithium America, to develop a Nevada mine extracting lithium, a key battery ingredient. Production there is expected to start in 2026, Ms. Barra said.
But competition is getting keener. Automakers including Ford Motor, Volkswagen, Hyundai and Kia have also rushed new E.V.s to the U.S. market. And on Monday, Ford cut prices of its Mustang Mach-E electric S.U.V., after Tesla cut its prices in mid-January by as much as 20 percent.
Garrett Nelson, an analyst with the financial research firm CFRA, said more than 100 E.V. models would be offered in the U.S. market by 2025. “We view the risk of market oversaturation as very high, and an industry pricing war should pressure margins,” he said. “We remain skeptical that G.M. will achieve sales success with many of its new E.V. models.”
