General Motors trucks collected huge profits despite the global semiconductor shortage crisis and the return of the epidemic, but investors indicated that they expect more from CEO Mary Barra, which led to a 7.8% drop in the stock of the most powerful American automaker.
The backlash to General Motors’ results highlights the uncertainty facing automakers in conjunction with the prevailing technical and economic turmoil. Toyota Motor and Honda Motor’s results have seen a similar backlash.
General Motors reported second-quarter net income of $2.8 billion, or $1.9 per share, compared to a loss of $806 million, or 56 cents, during the same period a year earlier.
Note that the report included the cost of a second recall of Chevrolet Bolt electric cars, which cost nearly $800 million. Excluding specific expenses, General Motors earned $1.97 per share, but analysts had expected earnings of $2.23 per share.
Analysts said the company’s full-year earnings guidance was conservative, knowing that it raised its pre-tax earnings outlook from $10-11 billion to $11.5-13.5 billion.
The General Motors truck market is facing threats from the Washington government, as the Biden administration is expected this week to propose tougher emissions limits from cars and an acceleration of the switch to electric vehicles, even though the company increased its spending in that area last month. Read more [General Motors Boosts spending on electric vehicles By 30%].
The epidemic crisis still poses a direct and indirect threat to the company’s business, especially with the spread of the new Delta strain that threatens the company’s workers in particular, and the stock market in general. Read more [Wall Street ends week lower after Delta dynasty fears].