General Motors Co. said today its fourth-quarter profit rebounded from a year-earlier loss, fueled by results in its home North American market.
At the same time, the automaker cautioned a semiconductor shortage, which is affecting the global auto industry, will trim its 2021 profit.
Detroit-based GM posted a quarterly profit of $2.8 billion, or $1.93 a share, compared with a deficit of $194 million, or 16 cents.
Leading the way was the automaker’s North American unit which reported an operating profit of $2.6 billion.
The company has mostly gotten out of producing passenger cars in favor of higher-profit trucks, SUVs, and crossovers. GM is relying on such vehicles for earnings while it invests in electric and self-driving vehicles.
The quarter capped off a year where GM saw its factories shut down in March to try to slow the spread of the novel coronavirus (COVID-19). The company reopened factories in May with new safety procedures. GM also produced ventilators for the treatment of COVID-19 cases.
“Once-in-a-century challenges like these are tough, but they also provide much-needed clarity and perspective,” CEO Mary Barra said in a letter to shareholders.
Barra also said GM’s move into EVs is the right strategy.
GM’s “commitment to an all-electric future is changing how people think about GM,” she said. “We’ve gone from being good stewards of a successful traditional automaker to being champions of growth”
GM is dealing with a new challenge this year.
The company forecast that the semiconductor shortage will reduce adjusted earnings before interest and taxes by $1.5 billion to $2 billion in 2021. The automaker currently has plants in Kansas, Canada, and Mexico on downtime while it ensures there are enough chips for its most popular models.
The automaker expects adjusted EBIT to total $10 billion to $11 billion this year.
GM’s full-year profit nearly matched its 2019 results despite the disruptions of 2020.
The company’s profit totaled $6.4 billion, or $4.33 a share, compared with 2019’s $6.7 billion, or $4.57.