Photo: Via GM
Only a few weeks ago, GM announced that it was planning to double its revenue by 2030 but now it's announced a 25% drop in profit for the third quarter.
This isn't entirely unexpected. The global chip shortage has hit the entire industry with only a few outliers. Without chips, cars can't be built, shipped, and sold.
General Motors CEO Mary Barra had a positive spin on the situation saying "The quarter was challenging due to continuing semiconductor pressures...but it also includes very strong results from GM Financial, the recall cost settlement we reached with our valued and respected supplier and JV partner LG Electronics, and ($300 million) in equity income from our joint ventures in China."
General Motors still expects to crush earlier estimates for overall income though. In February they reported an outlook of $10 billion to $11 billion for 2021. The current outlook plans to hit at least $11 billion with a current maximum of $13.5 billion.
Interestingly enough, they also see the chip shortage affecting profit and revenue throughout the first half of 2022. "The company expects chip shortages will last into next year, but it will improve in the second half of 2022," Barra said of the situation.
It doesn't seem as though the downturn will affect the plan recently announced to bring more EVs to market. That includes the BrightDrop EV Vans that are being built right now for FedEx. It also includes the new Hummer EV, and the Silverado EV set to be revealed at CES in January.
Certainly, this is a small setback but with the companies future plans, it should rebound without too much trouble. New EV products will bolster the brand and until then. Cool stuff like the new Corvette Z06 and Chevrolet's 1001 horsepower crate engine will keep the company in good graces too.
General Motors CEO Mary Barra had a positive spin on the situation saying "The quarter was challenging due to continuing semiconductor pressures...but it also includes very strong results from GM Financial, the recall cost settlement we reached with our valued and respected supplier and JV partner LG Electronics, and ($300 million) in equity income from our joint ventures in China."
General Motors still expects to crush earlier estimates for overall income though. In February they reported an outlook of $10 billion to $11 billion for 2021. The current outlook plans to hit at least $11 billion with a current maximum of $13.5 billion.
Interestingly enough, they also see the chip shortage affecting profit and revenue throughout the first half of 2022. "The company expects chip shortages will last into next year, but it will improve in the second half of 2022," Barra said of the situation.
It doesn't seem as though the downturn will affect the plan recently announced to bring more EVs to market. That includes the BrightDrop EV Vans that are being built right now for FedEx. It also includes the new Hummer EV, and the Silverado EV set to be revealed at CES in January.
Certainly, this is a small setback but with the companies future plans, it should rebound without too much trouble. New EV products will bolster the brand and until then. Cool stuff like the new Corvette Z06 and Chevrolet's 1001 horsepower crate engine will keep the company in good graces too.
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