After a solid start to the year, General Motors is raising its earnings and cash flow expectations for 2023. GM is gearing up for a breakout year with several highly anticipated EV launches planned across some of the most popular auto segments.
GM expects a breakout year with EVs in 2023
General Motors sold over 20,000 fully electric vehicles for the first time in the first three months of 2023, surpassing Ford as the number-two EV maker in the US and increasing its market share by eight percentage points.
The growth was led by the Chevy Bolt EV and EUV models selling 19,700 alone in Q1, the third consecutive record sales month for one of the most affordable EVs on the market. Cadillac Lyriq sales also expanded to 968 in the quarter, while only two GMC Hummer EV pickups were sold.
Looking ahead, GM expects the momentum to continue with plans to produce 50,000 EVs in North America in the first half of 2023 and 100,000 in the second half.
GM has several high-volume EVs launching this year, including the:
- Silverado EV: Deliveries to begin later in the second quarter to the first 340 fleet customers. Production will ramp up in the second half of the year
- Blazer EV: Launching this summer
- Equinox EV: Launching this fall
The automaker mentioned “exciting news” will be coming in the next few weeks and months ahead on its growing EV portfolio of Chevy, Buick, GMC, Cadillac, and Brightdrop EVs. GM says the news will demonstrate that “work” and “range” are not exclusive terms for the Chevy Silverado EV and GMC Sierra EV, suggesting new trims will be unveiled.
Perhaps, most importantly, GM continues to build out its supply chain to support the growth with plans for four battery cell plants in North America targeting 160 GWh capacity. The automaker revealed news plans for a $3 billion battery cell factory with Samsung.
The battery cell production will enable GM to hit its target of producing 1 million EVs annually in North America by 2025.
GM Q1 2023 financial results
GM’s revenue rose 11% in the first three months of the year to $40 billion, beating Wall St. analyst expectations of $39.24 billion. In addition, GM generated $2.4 in net income. The growth comes despite net income margins slipping 26.8% YOY.
The automaker said it achieved record profits in the first quarter, excluding China. A challenging Chinese market caused lower volumes and pricing pressure from industry leaders.
The earnings growth comes despite higher interest rates and ongoing supply chain issues that have plagued much of the industry.
The strong quarter was enough for GM to raise its guidance for the year. GM now expects profits between $11 billion to $13 billion, up $500 million from its previous guidance.
GM is also expecting free cash flow between $5.5 billion and $7.5 billion, also up $500 million from previous estimates. The automaker says the higher expectations comes as it believed the second half would be more challenging than it’s shaping up to be.
Despite the risks, GM feels comfortable raising its guidance. The confidence comes as GM plans for a breakout year with EVs in 2023, including launching the Silverado EV, Equinox EV, and Blazer EV.
GM says launching the right models at the right price point will help fuel future growth.
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