Q3 group revenue rose by 10.5% to a record US$48.76bn as consolidated wholesales rose by 5.3%. By Jonathan Storey
Following earnings beats in Q1 and Q2 2024, GM’s Q3 results not only outperformed consensus forecasts again, but were again accompanied by an upward adjustment of its full-year forecast. The market’s response was to mark the shares up by 8% on results day to a two-and-a-half-year peak as GM’s performance was particularly well received against the background increasing industry gloom and profit warnings at several rivals.
GM % change, Q3 2024 -v- yr ago
Q3 group revenue rose by 10.5% to a record US$48.76bn as consolidated wholesales rose by 5.3% to 1,033,000 units (please note the table below shows an 8.8% fall in retail sales, including the contribution by non-consolidated JVs in China).
Reported group operating profit was 21% higher at US$3.65bn. The reported figure included net non-recurring charges of US$417m, the major ones being US$190m for restructuring in North America and US$150m for restructuring of the Buick dealer network. In Q3 2024 net non-recurring charges amounted to US$123m.
GM operating margin (%)
On a recurring basis the company reported Q3 Ebit of US$4.11bn, up 15.5%. The net increase of US$551m reflected the following:
- US$1.0bn—price;
- US$0.9bn—volume increase in GMNA, partly offset by a small drop in GMI;
- US$(0.2)bn—net cost increases;
- US$(0.6)bn—adverse mix;
- US$(0.5)bn—other.
Sticking with the recurring figures, the company reported a 14.3% rise in GMNA’s Ebit to US$4.0bn but the division’s Ebit margin dipped to 9.7% from 9.8% in Q3 2023.
GMI’s recurring Ebit fell to just above breakeven from US$0.4bn, due to a negative contribution by the non-consolidated Chinese joint ventures. If the Chinese operations are excluded, GMI’s recurring Ebit margin improved to 5.1% from 3.8%.
GM Financial’s contribution to recurring earnings before tax fell by 7.3% to US$687m and the loss at Cruise improved to US$(383)m from US$(732)m due to the operation’s reduced activity.
| GM | Unit | 9Mo-24 | Q3-24 | H1-24 | Q2-24 | Q1-24 | |||||
| Group | Data | % | Data | % | Data | % | Data | % | Data | % | |
| Revenue | $ mil | 139,740 | 8.4 | 48,757 | 10.5 | 90,983 | 7.4 | 47,969 | 7.2 | 43,014 | 7.6 |
| Op. profit | $ mil | 11,262 | 34.4 | 3,651 | 21.2 | 7,611 | 41.8 | 3,873 | 38.9 | 3,738 | 45.0 |
| Pre-tax profit | $ mil | 11,075 | 19.5 | 3,717 | 7.3 | 7,358 | 26.8 | 3,643 | 20.3 | 3,715 | 33.9 |
| Net profit | $ mil | 8,838 | 12.6 | 3,008 | 0.5 | 5,830 | 20.1 | 2,877 | 14.8 | 2,953 | 25.9 |
| Employees | 000’s | 164 | 0.0 | 164 | 0.0 | 165 | 0.0 | 165 | 0.0 | 163 | (1.8) |
| Unit sales | 000’s | 4,257 | (7.2) | 1,477 | (8.8) | 2,780 | (6.3) | 1,432 | (9.5) | 1,348 | (2.6) |
| GMNA | 000’s | 2,326 | 0.8 | 790 | (0.8) | 1,536 | 1.6 | 827 | 2.7 | 709 | 0.3 |
| GME | 000’s | 2 | 0.0 | 1 | 0.0 | 1 | 0.0 | 1 | 0.0 | 0 | – |
| GMSA | 000’s | 305.0 | (8.4) | 110 | (8.3) | 195 | (8.5) | 111 | 2.8 | 84 | (20.0) |
| GMIO | 000’s | 1,624 | (16.5) | 576 | (18.1) | 1,048 | (15.6) | 493 | (26.3) | 555 | (3.0) |
| Per unit | |||||||||||
| Revenue | $ | 32,826 | 16.8 | 33,011 | 21.2 | 32,728 | 14.6 | 33,498 | 18.5 | 31,909 | 10.4 |
| Op. profit | $ | 2,646 | 44.8 | 2,472 | 32.9 | 2,738 | 51.4 | 2,705 | 53.5 | 2,773 | 48.9 |
| Pre-tax profit | $ | 2,602 | 28.8 | 2,517 | 17.7 | 2,647 | 35.3 | 2,544 | 33.0 | 2,756 | 37.4 |
| Net profit | $ | 2,076 | 21.4 | 2,037 | 10.2 | 2,097 | 28.2 | 2,009 | 26.9 | 2,191 | 29.2 |
| Per employee | |||||||||||
| Revenue | $ | 852,073 | 8.4 | 297,299 | 10.5 | 551,412 | 7.4 | 290,721 | 7.2 | 263,890 | 9.6 |
| Op. profit | $ | 68,671 | 34.4 | 22,262 | 21.2 | 46,127 | 41.8 | 23,473 | 38.9 | 22,933 | 47.7 |
| Pre-tax profit | $ | 67,530 | 19.5 | 22,665 | 7.3 | 44,594 | 26.8 | 22,079 | 20.3 | 22,791 | 36.3 |
| Net profit | $ | 53,890 | 12.6 | 18,341 | 0.5 | 35,333 | 20.1 | 17,436 | 14.8 | 18,117 | 28.2 |
| Sales | units | 26.0 | (7.2) | 9.0 | (8.8) | 16.8 | (6.3) | 8.7 | (9.5) | 8.3 | (0.8) |
| Return on revenue | |||||||||||
| Op. profit | % | 8.1 | 1.6 | 7.5 | 0.7 | 8.4 | 2.0 | 8.1 | 1.8 | 8.7 | 2.2 |
| Pre-tax profit | % | 7.9 | 0.7 | 7.6 | (0.2) | 8.1 | 1.2 | 7.6 | 0.8 | 8.6 | 1.7 |
| Net profit | % | 6.3 | 0.2 | 6.2 | (0.6) | 6.4 | 0.7 | 6.0 | 0.4 | 6.9 | 1.0 |
| Revenue by div. | |||||||||||
| GMNA | $ mil | 117,981 | 11.1 | 41,157 | 14.0 | 76,824 | 9.6 | 40,725 | 9.4 | 36,099 | 9.8 |
| GMI | $ mil | 9,897 | (17.6) | 3,517 | (18.8) | 6,380 | (16.9) | 3,298 | (16.6) | 3,082 | (17.3) |
| Auto Intra-Co | $ mil | 131 | 62 | 69 | 37 | 32 | |||||
| Auto total | $ mil | 128,009 | 8.1 | 44,736 | 10.5 | 83,273 | 6.9 | 44,060 | 6.8 | 39,213 | 7.0 |
| Financial svcs | $ mil | 11,760 | 12.2 | 4,031 | 10.7 | 7,729 | 13.0 | 3,918 | 12.0 | 3,811 | 14.0 |
| Other | $ mil | (29) | (10) | (19) | (9) | (10) | |||||
Outlook
GM began the year forecasting recurring Ebit of US$12-14bn for 2024. At the time of announcing its results for:
- Q1, it raised this to US$12.5-14.5bn;
- Q2, it raised the range again to US$13-15bn;
- Q3, it narrowed the range further to $US14-15bn.
Looking ahead to 2025, in CEO Mary Barra’s letter to shareholders, she said recurring Ebit is expected to be in a similar range to the forecast 2024 result. The letter mentioned four drivers: progress on EV profitability, along with rising sales and market share growth; a wide range of redesigned SUVs that are more profitable than the outgoing models; overall cost discipline and focus on capital efficiency; and improved performance in China.