GM rebounds with $8.1B 2018 profit on strong pricing

Mary Barra's turnaround plan for GM already paying off with fourth-quarter earnings beat

"When GM delivers good business results, our eligible hourly employees in the US share in the company's success", said Mary Barra, GM's CEO and chairman.

The Detroit automaker, which made $11.8 billion last year, announced profit-sharing as part of its full-year 2018 earnings report. The most recent quarter included a $1.3 billion charge related to job cuts under a continuing restructuring in North America, offset partly by a tailwind from foreign tax credits. The latest payment will come in the February 22 paycheck. But it still played out well for profit-sharing checks, with about 46,500 union workers in the U.S. They will take home $10,750 each, less than last year's $11,500.

The reorganization will also result in involuntary layoffs to about 4,000 GM salaried workers, a person familiar with the matter told AFP last week.

However, GM is clear that its electric vehicles won't make money until "early next decade", Barra said. The company employs more than 3,000 people at its truck assembly plant in Allen County.

The company said Wednesday that it made $5.58 per share for the year. The auto manufacturer reported $1.43 earnings per share for the quarter, beating the Zacks' consensus estimate of $1.21 by $0.22.

"Our outlook for China overall is for the auto industry to be flat year over year", CFO Dhivya Suryadevara said.

The largest US automaker repeated its commitment Wednesday to make its entire vehicle lineup "all-electric", but provided investors with few details of those plans on a conference call after GM reported fourth quarter earnings that beat expectations.

General Motors Co. shares were trading at $39.64 per share on Wednesday afternoon, up $0.34 (+0.87%).

The Trump administration's tariffs on imported aluminum and steel raised prices of those commodities, costing the company more than $1 billion past year. Suryadevara expects another US$1-billion increase this year. GM Financial, the company's lending arm, earned $1.9 billion, nearly 60 percent more than in 2017.

'GM delivered another strong year of earnings in a highly volatile environment in 2018.

GM said on Wednesday that China's $300 million in operating earnings in the fourth quarter was offset by other global markets.

For the full year, GM made $423 million pretax from its worldwide operations, about one third of the $1.3 billion from a year earlier. Cruise Automation, GM's autonomous vehicle unit, lost $728 million, 19 percent more than a year earlier. The company had revenue of $38.40 billion during the quarter, compared to the consensus estimate of $36.31 billion.

The shares of General Motors Company (NYSE:GM) has been pegged with a rating of Neutral by Goldman in its latest research note that was published on September 11th, 2018. All of the company's profits came from North America, where sales of many smaller SUVs rose and the average sale price of a GM vehicle hit a record of $36,974, the company said.

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