GM reports nearly $10 billion in profit in 2022 despite headwinds
Published in Automotive News
General Motors Co. booked $9.9 billion in net income last year, down from 2021's $10 billion despite chronic supply chain woes, rising interest rates and a slowing economy.
Revenue for the year was $156.7 billion, up from the $127 billion GM collected in 2021. GM met its projected guidance of earnings before taxes with a record $14.5 billion. In the fourth quarter, GM made $2 billion in net income on revenue of $43 billion. In the fourth quarter of 2021, GM tallied $1.7 billion in net income on revenue of $33.5 billion.
GM's comparatively strong financial performance enabled the Detroit automaker to deliver profit-sharing bonuses of $12,750 to approximately 42,300 hourly employees — GM's highest such profit-sharing payout. The bonuses total $500 million for the year, the company said, or $1.2 billion over the past three years.
In 2023, GM expects adjusted earnings to be in a range of $10.5 billion to $12.5 billion. In a call Tuesday morning, GM CFO Paul Jacobson said the company is seeking $2 billion in cost savings in the automotive business over the next two years. But he stressed that would not include layoffs similar to those recently announced by other companies, especially big names in the tech sector.
"I want to be clear ― we're not planning layoffs," he said. "We're limiting our hiring to only the most strategically important roles and we will use attrition to help manage our overall headcount."
GM expects to achieve 30% to 50% of that $2 billion cost reduction this year, he said. The automaker also will reduce costs by "continuing to reduce complexity in all of our products," Jacobson said.
GM's net income margins for the year were 6.3%. Pre-tax earnings in GM North America totaled $13 billion, up from $10.3 billion in 2021, fueling record profit-sharing checks to eligible members of the United Auto Workers. GM International's pre-tax earnings were $1.1 billion, up from $827 million made last year.
GM's margins did shrink from last year's 7.9%. The automaker said it took a $511 million charge from its Buick dealer buyout program and a $657 million charge from exiting Russia following the Ukraine invasion. GM expects to incur additional charges with the Buick buyout program this year. Buick hasn't said yet how many of its 2,000 dealers are accepting a buyout instead of moving forward with the brand's all-electric future.
Earlier this month, GM said it sold 2,274,088 new vehicles last year, up from the 2,218,228 in 2021. GM reclaimed its throne from Toyota Motor Corp. as the top-selling U.S. automaker after losing the title in 2021. The Japanese automaker reportedly sold 2.1 million vehicles last year, a 10% decrease from 2021's sales.
Ford Motor Co. reports its earnings Thursday. Stellantis NV will release its financial results on Feb. 22.
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