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GM Posts Quarterly Loss on Strike

Bill Koenig
By Bill Koenig Senior Editor, SME Media

General Motors Co. today reported a fourth-quarter loss and a lower full-year profit because of a strike by the United Auto Workers.

Detroit-based GM posted a quarterly loss of $194 million, or 16 cents a share, compared with a profit of $2 billion, or $1.40, for 2018’s fourth quarter.

GM lost four weeks of vehicle production during the quarter. The UAW conducted a 40-day strike beginning in mid-September. Revenue for the period declined 20 percent to $30.8 billion compared with a year earlier.

GM reported an adjusted quarterly profit of 5 cents a share. That was better than the 1 cent estimate consensus estimate from Refinitiv, according to CNBC.

For all of 2019, GM reported a profit of $6.7 billion, or $4.57 a share, down from $8 billion, or $5.53, the year before. Annual revenue slipped 6.7 percent to $137.2 billion. GM said the walkout had a $3.6 billion impact for the year.

The automaker forecast an adjusted 2020 profit of $5.75 to $6.25 a share. That compares with a 2019 adjusted profit of $4.82 a share. The company said it would benefit from a full year of sales of its redesigned Chevrolet Silverado and GMC Sierra pickups in 2020.

GM in its earnings report emphasized its plans to produce a line of electric vehicles. The company previously announced a $2.2 billion investment in its Detroit-Hamtramck factory to assemble a line of electric trucks and SUVs. Plans include a GMC Hummer EV. Production of electric pickups is scheduled to start in 2021.

GM also is investing in self-driving vehicles, also known as autonomous vehicles, or AVs.

“We are confident that our EV and AV strategies will drive shareholder value while improving the environment,” CEO Mary Barra said in a statement.

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