GM upbeat on full-year earnings despite quarterly profit drop

[DETROIT] General Motors on Wednesday reported stronger-than-expected results for the third quarter despite a drop in revenue and profit and said full-year earnings would be at the high end of its previous forecast.

GM said adjusted earnings per share in the quarter dropped to US$1.52, from US$2.83 a year earlier, citing the global semiconductor shortage. Analysts had expected US$0.96 a share.

In a letter to shareholders, chief executive Mary Barra said, "We now believe GM's full-year results will approach the high end of our guidance, which is for EBIT-adjusted in the range of US$11.5 billion to US$13.5 billion." GM said third quarter results dropped mainly because of lower wholesale shipments to dealers due to the continuing shortage of chips and increased commodity and logistics costs.

The company said the negative impact was partially offset by strong pricing on full-size pickups and SUVs and an agreement by supplier LG Electronics to cover most of the anticipated US$2 billion in costs related to the recall of Bolt EV and Bolt EUV.

REUTERS