The GM Board of Directors has announced the company will reinstate quarterly cash dividend payments to shareholders after it suspended this practice in April of 2020 due to uncertainty stemming from the COVID-19 pandemic.
The GM Board said Friday that it had authorized the reinstatement of a quarterly cash dividend on the company’s outstanding common stock at a rate of nine cents per share. The first dividend payments will be sent to shareholders on September 15th, 2022.
In addition, GM said it will once again undertake “opportunistic,” share buybacks amid increased confidence in the market. As a result, the GM Board has increased the capacity of the company’s existing repurchase program from $3.3 billion to $5 billion.
GM CEO Mary Barra said Friday the automaker’s recent financial performance, as well as the expansion of its EV product portfolio and domestic battery manufacturing infrastructure, has “improved our visibility and strengthened confidence in our capacity to fund growth while also returning capital to shareholders.” Company CFO Paul Jacobson echoed this sentiment, saying the automaker’s “consistently strong earnings, margins and cash flow, our investment-grade balance sheet, and the achievement of several significant milestones in our growth strategy enables us to invest aggressively,” and return excess free cash flow to shareholders.
The American automaker believes it is well-positioned for the future after investing billions in its North American electric vehicle and battery manufacturing infrastructure. Ultium Cells LLC, the company’s battery manufacturing joint venture with LG, will open its first plant in Warren, Ohio this month, while two other plants in Tennessee and Michigan will come online in 2023 and 2024, respectively. Its North American electric vehicle manufacturing base is also expanding, while its growing EV product portfolio covers key segments such as crossovers, pickup trucks, luxury vehicles, utility vans and hatchbacks. Key current and future EV models covering these segments include the GMC Hummer EV Pickup, Chevy Silverado EV, Chevy Equinox EV, BrightDrop Zevo 600 and Chevy Bolt EV.