The impact of the COVID-19 pandemic on the auto industry can’t be overstated, with production issues, supply chain issues, shifts in customer demand, and countless other issues affecting every major automaker, including General Motors. Now, GM says that the current, ongoing COVID-19 outbreak in China will likely affect its Q1 2023 results.
Per a recent report from Reuters, GM has stated that it expects the COVID-19 situation in China to have an impact on first-quarter results, with Chief Financial Officer Paul Jacobson saying that the automaker was closely monitoring the macroeconomic environment. China’s decision to lift COVID-19 restrictions last December is believed to have led to a rapid rise in cases in the country, affecting consumer sentiment and GM’s business there as well.
“We think it’s going to impact first quarter, we’ll see if it bleeds into second quarter,” said GM CEO Mary Barra said at a recent conference.
Nevertheless, GM also stated that it is currently seeing no signs of slowing demand for automobiles in the broader market, despite economic concerns.
“We still have very good confidence in the market,” CFO Paul Jacobson said.
GM released its fourth-quarter 2022 earnings report late last month, which was headlined by $2.0 billion in net income on $43.1 billion in revenue. The latest figures show a 17.6-percent improvement to net income and a 28-percent improvement to revenue compared to figures from Q4 of the 2021 calendar year. According to GM, the upticks were driven by “wholesale volume growth and robust pricing across the portfolio,” and were partially offset by “mix normalization, commodity costs, and GMF [GM Financial] EBT” lower compared to the year-ago quarter.
During Q4 of 2022, GM recorded 1,551 million vehicle deliveries globally, an increase of 12,000 units, or 0.8 percent, year-over-year. The GM China auto joint venture posted $10.4 billion in revenue, $0.2 billion in equity income, and 796,000 vehicle wholesales, as compared to $13.6 billion in revenue, $0.2 billion in equity income, and 1,007,000 vehicle wholesales for the year-ago quarter.
Just a few days ago, GM declared a first quarter 2023 dividend of 9 cents per share on the company’s outstanding shares of common stock.