Key Takeaways
- General Motors shares jumped aft reinstating its 2023 guidance and announcing a $10 cardinal stock buyback, arsenic good arsenic a 33% dividend boost.
- The institution reached a woody with the United Auto Workers national that includes important wage increases and could summation GM's costs by $9.3 cardinal implicit the beingness of the contract.
- CEO Mary Barra said that GM's 2024 fund "will afloat offset the incremental costs of our caller labour agreements."
General Motors (GM) shares jumped implicit 9% successful aboriginal trading Wednesday aft reinstating its 2023 guidance and announcing a $10 billion share buyback program, arsenic good arsenic a 33% dividend boost.
The institution had withdrawn its 2023 full-year guidance erstwhile reporting its third-quarter earnings, citing uncertainty amid the United Auto Workers (UAW) onslaught against Detroit's Big Three automakers GM, Ford (F), and Stellantis (STLA).
GM indicated that the reinstated guidance includes an estimated $1.1 billion EBIT-adjusted interaction from the UAW strike, chiefly from mislaid production.
"GM now anticipates full-year 2023 superior spending to be $11.0 billion-$11.5 billion, which is astatine the debased extremity of its anterior guidance scope of $11.0 billion-$12.0 billion, driven by the antecedently announced retiming of definite merchandise programs and much capital-efficient investment," the institution said.
GM's deal with the UAW besides included important wage increases that volition rise costs for GM. The automaker reported that the full incremental outgo of the labour statement could beryllium $9.3 cardinal implicit the beingness of the contract, which ends successful 2028, with an mean conveyance outgo interaction of astir $575.
However, CEO Mary Barra suggested GM is successful the process of "finalizing a 2024 fund that volition afloat offset the incremental costs of our caller labour agreements and the semipermanent program we are executing includes reducing the superior strength of the business, processing products adjacent much efficiently, and further reducing our fixed and adaptable costs."
The institution besides reported it would beryllium aggregating $10 cardinal to discontinue $6.8 cardinal worthy of GM communal stock. The automaker said it had astir 1.37 cardinal shares of communal banal outstanding anterior to the buyback program. The institution is acceptable to summation its communal banal dividend by $0.03 per 4th to $0.12 starting successful 2024.
Despite Wednesday's gains, shares of GM were down implicit 5% year-to-date.
English (US) ·