General Motors (GM) reported higher profit thanks to the continued strengthening of the North American market.
GM, benefiting from continued strong demand from U.S. consumers for pickup trucks and other larger vehicles, raised its 2024 net profit range by $300 million to $10.1 billion to $11.5 billion.
"The team is doing well and making progress in all areas," Chief Executive Officer Mary Barra said in a letter to shareholders, AFP reported.
First-quarter net income rose 24% to $3.0 billion on 7.6% revenue growth.
U.S. auto deliveries were down slightly in terms of volume, but profits in North America rose thanks to "consistent" pricing and lower costs, the company said in a presentation.
"Our customers have been remarkably resilient in this period of higher interest rates," said Chief Financial Officer Paul Jacobson.
He said pricing was "essentially unchanged" compared to the previous quarter. The company still expects pricing power to erode slightly in 2024, although it has yet to see a decline in the surface of the market.
Vehicle inventories at GM's U.S. dealers rose to 534,000, well above the level seen in 2023. In recent years, inventories have been below industry targets due to Covid-19 disruptions and issues in the supply chain.
Current inventory equates to about 63 days of supply, which GM considers "pretty good" given that spring is a seasonally strong period for auto sales.
GM's strong position in its home market helped offset an operating loss of about $100 million in GM's China operations.
"We expect things to normalize a little bit and return to profitability," Jacobson said of China, pointing to upcoming auto premieres. /BGNES
