General Motors Company · NYSE:GM
General Motors — Q2 2023 Earnings Presentation
45 slides from General Motors's earnings presentation, Jul 25, 2023
Slide 1: Strong First Half Builds Momentum
Strong First Half Builds Momentum Q2 2023 Earnings July 25, 2023
Slide 2: Table of Contents
Table of Contents Page 04 Q2 Highlights ICE Portfolio Optimization EV Acceleration New Business Growth Page 15 2023 Guidance Page 16 Summary of 2023-2025 KPIs Page 17 Long-Term Investment Opportunity Page 18 Financial Information Page 32 Supplemental Financial Information 2024 Chevrolet Trax 2
Slide 3: Information Relevant to this Presentation
Cautionary note on forward-looking statements: this presentation and related comments by management may include “forward-looking statements” within the meaning of the U.S. federal securities laws. Forward-looking Information statements are any statements other than statements of historical fact. For
Slide 4: Q2'23 Highlights
Q2’23 Highlights Winning with customers, delivering strong results EBIT-Adj. $3.2B Raising 2023 Strong core auto business performance Adj. Auto Free Cash Flow $5.5B full-year guidance for the driven by record quarterly revenue, with 2nd consecutive quarter stable incentives and inventory Achieved No
Slide 5: Customer Demand Drives Growth
Customer Demand Drives Growth U.S. Premium Trucks grow from a niche to a centerpiece • Highest-ever penetration of AT4 and Denali: 70% of GMC Sierra HD sales; nearly 50% of Sierra LD sales; more than 74% of Canyon orders • ~75% of Chevrolet Tahoe and Suburban sales are premium trims (RST, Z71, Premi
Slide 6: Go-to-Market Strategy Enhances Performance
Go-to-Market Strategy Enhances Performance Robust Pricing, Low Incentives, Balanced Inventory Drive Strong First Half Results • Q2 U.S. Average Transaction Price (ATP) $52,248, up $1,890 YoY and $1,600 from Q1’23 • Incentives as a % of ATP – Ended Q2 at 3.1% compared to industry average of 3.8%, nea
Slide 7: Investing in the Next Generation of Full-Size Trucks and SUVs
Investing in the Next Generation of Full-Size Trucks and SUVs Flint, Michigan Arlington, Texas Fort Wayne, Indiana $1B+ to produce the next $0.5B+ to produce the next $0.6B to produce the next generation of heavy-duty trucks generation of full-size SUVs generation of light-duty trucks Investments wi
Slide 8: Launched GM Envolve: New Customer Experience, New Vehicles
Launched GM Envolve: New Customer Experience, New Vehicles Extend our Lead in Fleet & Commercial Market One-stop customer experience Broadest product portfolio of cars, Growing suite of fleet-tailored for our industry-leading fleet trucks, SUVs and EVs in the industry, software services, including G
Slide 9: Chevrolet Silverado EV Work Truck: More Range = More Work
Chevrolet Silverado EV Work Truck: More Range = More Work Industry-leading 450 10,000 Deliveries begin soon mile EPA-estimated range, lbs. towing to commercial *EPA-estimated. Actual range may vary based on several factors, including 40% more than nearest capacity customers temperature, terrain, bat
Slide 10: New EVs in H2 Strategically Target Growth Segments
New EVs in H2 Strategically Target Growth Segments Q3’23 YE’23 Chevrolet Silverado EV Chevrolet Blazer EV Chevrolet Equinox EV Chevrolet Silverado EV BrightDrop Zevo 400 Cadillac CELESTIQ Work Truck Production begins Production begins RST First Edition Production begins Production begins Production
Slide 11: Cadillac ESCALADE IQ Reveal on Aug. 9
Cadillac ESCALADE IQ Reveal on Aug. 9 The brand’s first-ever all-electric full-size SUV, ESCALADE IQ represents the reinvention of Cadillac’s most iconic nameplate. 11
Slide 12: Expanding our Competitive Advantage
Expanding our Competitive Advantage Marcy, NY Wolfspeed, silicon carbide supply agreement Developing a more resilient, North American focused Rochester, NY manufacturing and supply chain ecosystem for EV growth EV component production Wakefield, MA Bécancour, Quebec Nanoramic, lithium-ion • CPOSCO C
Slide 13: Doubling EV Charging Access
Doubling EV Charging Access GM & Tesla Ultium Charge 360 Collaboration • GM will begin to integrate • Expanding charging access across home, North American Charging workplace and public spaces Standard (NACS) starting in 2025 • More than 134,000 chargers available to GM EV drivers through Ultium Cha
Slide 14: Cruise: Scaling Progressively Faster
Cruise: Scaling Progressively Faster • Reached the 3rd million driverless miles in just 49 days, nearly two times faster than the 2nd million • Doing 10,000 rides a week, recently hit 390 driverless AVs running concurrently across all operating cities • First million driverless miles safety report s
Slide 15: Raising CY 2023 Guidance
Raising CY 2023 Guidance* Expect to drive consistently strong core auto operating performance in 2023 $12-14B $7.15-$8.15 $7-9B EBIT–adj. EPS–diluted–adj. Adj. Auto FCF Previously $11-13B Previously $6.35-$7.35 Previously $5.5-7.5B 8-10% $11-12B 16-18% GMNA EBIT-adj. margins Capital spend + Battery
Slide 16: Summary of 2023-2025 KPIs
Summary of 2023-2025 KPIs Total Revenue of $225B+ in 2025 GMNA EBIT-adjusted margins of Total capital spending of Company (~12% CAGR) ~8-10% through 2025 ~$11-13B per year through 2025 (2024-2025 under review) 400K EV production EV portfolio at a low EV revenue of units from 2022 – H1 2024 Cell cost
Slide 17: Long-Term Investment Opportunity
Long-Term Investment Opportunity ~50% revenue CAGR Attractive Expect margin expansion Expect to double company in software and new Strong core auto business Revenue to 12-14% by 2030 with revenue to $275-315B businesses by 2030 while target revenue CAGR of Growth & Margin new businesses margins by 2
Slide 18: Financial Information
Financial Information 18
Slide 19: Second Quarter Financial Highlights
Second Quarter Financial Highlights $44.7B $3.2B $5.5B Revenue EBIT–adj. Adj. Auto FCF 979K 7.2% 16.3% Wholesale units EBIT-adj. Margin U.S. Market Share 19
Slide 20: Second Quarter Performance
Second Quarter Performance EPS-DILUTED-ADJ.; EPS-DILUTED-ADJ.1 EBIT-ADJ.1 ($B) & EBIT-ADJ. MARGIN1 EBIT-ADJ. & MARGIN $0.9B YoY increase mainly driven by strong core 7.2% auto operating performance, partially offset by LGES and LGE agreements (Collectively, LG 6.6% agreements), normalized GMF EBT, l
Slide 21: Second Quarter EBIT-adjusted ($B)
Second Quarter EBIT-adjusted ($B) Q2-2022 Q2-2023 $3.2 $3.2 $2.3 $2.3 $1.1 $0.8 $0.2 $0.2 $(0.3) $(0.5) $(0.6) $(0.7) GMNA GMI GM Financial Cruise Corp/Elims Total Company GMNA and GMI ex. China strong core auto Lower GMF EBT and higher Cruise operating performance, capitalizing on expenses in line
Slide 22: Second Quarter EBIT-adjusted Performance ($B)
Second Quarter EBIT-adjusted Performance ($B) GMNA: 171K GM Financial: $(0.3) GMI: (8)K Other Investments: $0.3 $1.2 $0.7 $1.7 $0.0 $3.2 $2.3 $(2.7) Q2-2022 Volume Mix Price Cost Other Q2-2023 VOLUME/MIX PRICE COST Increased YoY volumes as supply chain GMNA and GMI ex. China strong pricing Cost incr
Slide 23: GMNA Performance
GMNA Performance NET REVENUE ($B) EBIT-ADJ. ($B) $37.2B 11.2% 10.3% 10.9% Best quarterly revenue on record 783 787 833 8.0% 8.6% 662 723 $34.7 $35.5 $37.2 $3.9 $3.7 $3.6 $52K+ $28.8 $32.9 $3.2 $2.3 Strong Q2 GM U.S. ATP paired with ~0.2 pts of YoY market share gain Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q2-2
Slide 24: GMI Performance – Excluding GM China JV
GMI Performance – Excluding GM China JV NET REVENUE ($B) EBIT-ADJ. ($B) 7.8% 7.1% 0.1% 1.6% 4.0% $4.3 $4.0 $0.3 $0.3 $4.0 $0.1 $0.2 $3.8 $3.7 $0.0 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 EBIT-Adj. margin from GMI ex. China El WHOLESALES (000’S) Q2’23 HIGHLIGHTS Strong core auto b
Slide 25: GM China Auto JV Performance
GM China Auto JV Performance NET REVENUE ($B) EQUITY INCOME ($B) 6.4% 4.3% 2.1% 3.6% $0.3 $10.4 $10.4 (3.4)% $8.1 $0.2 $6.1 $5.8 $0.1 $0.1 $(0.1) Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Total China Auto JV NI/Rev WHOLESALES (000’S) Q2’23 HIGHLIGHTS 768 796 YoY equity income incre
Slide 26: Cruise
Cruise ($B) Q2 H1 Financial Performance 2022 2023 2022 2023 Revenue1 0.0 0.0 0.1 0.1 EBIT-adjusted2 (0.5) (0.6) (0.9) (1.2) Cash used in operating activities (0.5) (0.5) (0.8) (0.9) Cash, cash equivalents and marketable securities3,4 3.7 2.1 3.7 2.1 Increased Cruise expenses in line with expectation
Slide 27: GM Financial
GM Financial EBT-ADJUSTED ($B) ENDING EARNING ASSETS ($B) 44.6% 42.9% 45.9% 29.2% 39.7% 41.4% 27.9% 25.1% 21.5% 19.3% $104.2 $106.7 $109.3 $110.2 $112.8 $1.1 $0.9 $0.8 $0.8 $0.8 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Return on Average Tangible Common Equity GMF as % of GM U.S. R
Slide 28: Adjusted Automotive Free Cash Flow
Adjusted Automotive Free Cash Flow Q2 H1 ($B) 2022 2023 2022 2023 Net Income 1.6 2.5 4.4 4.9 Income tax and net automotive interest expense 0.7 0.5 0.8 0.9 EBIT adjustments1 - 0.2 1.0 1.1 Net loss (income) attributable to noncontrolling interests 0.0 0.1 0.2 0.1 EBIT-adjusted 2.3 3.2 6.4 7.0 GMF EBT
Slide 29: Automotive Liquidity and Debt
Automotive Liquidity and Debt AUTOMOTIVE LIQUIDITY ($B) TOTAL AUTOMOTIVE DEBT ($B) $39.5 $38.9 $15.1 $13.5 Strong liquidity levels support current and near-term macroeconomic and industry $24.4 $25.3 $17.8 $16.4 conditions Dec 31, 2022 Jun 30, 2023 Dec 31, 2022 Jun 30, 2023 Available Credit Faciliti
Slide 30: Regional Q2 EBIT-adjusted Performance ($B)
Regional Q2 EBIT-adjusted Performance ($B) GMNA GMI $0.9 $0.7 $0.3 $1.7 $0.1 $3.2 $2.3 $(2.5) $0.2 $0.1 $0.2 $(0.2) $(0.1) $(0.0) Q2-2022 Volume Mix Price Cost Other Q2-2023 Q2-2022 Volume Mix Price Cost Other Q2-2023 $5.4 $2.1 $0.6 $2.2 $(3.4) $(0.0) $6.8 $0.5 $(0.0) $0.1 $0.6 $(0.4) $(0.3) $0.6 Ye
Slide 31: Summary
Summary Q2’23 Results What’s to Come • Consistently meeting or exceeding our financial targets • Continue to execute with intense focus on operational excellence and profitability, on track to achieve our net $2B • Ongoing strength of core auto business paired with GMF cost reduction target strong r
Slide 32: Supplemental Financial Information
Supplemental Financial Information 32 32
Slide 33: Second Quarter GAAP Results
Second Quarter GAAP Results Q2 H1 All amounts in $B except EPS-diluted 2022 2023 2022 2023 Net revenue 35.8 44.7 71.7 84.7 Operating income 2.1 2.8 4.3 5.4 Net income attributed to stockholders 1.7 2.6 4.6 5.0 Net income margin 4.7% 5.7% 6.5% 5.9% EPS-diluted ($/share) $1.14 $1.83 $2.49 $3.52 Net ca
Slide 34: Global Deliveries
Global Deliveries (000's) Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 North America 687 663 729 707 805 U.S. 582 556 623 603 692 Asia/Pacific, Middle East and Africa 626 746 700 569 670 China 484 630 576 462 526 South America 107 130 124 106 108 Brazil 66 88 88 71 78 Global Deliveries – in GM Markets 1,
Slide 35: Global Market Share
Global Market Share Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 North America 15.6% 15.5% 16.2% 15.8% 15.6% U.S. 16.2% 15.8% 16.7% 16.4% 16.3% Asia/Pacific, Middle East and Africa 6.4% 6.5% 6.0% 5.4% 6.1% China 9.5% 9.9% 9.1% 9.1% 8.6% South America 11.8% 13.0% 12.8% 12.4% 12.5% Brazil 12.8% 15.0% 14.6%
Slide 36: Reconciliation of EBIT-adjusted
Reconciliation of EBIT-adjusted ($B) Q3 Q4 Q1 Q2 2021 2022 2021 2022 2022 2023 2022 2023 Net income attributable to stockholders 2.4 3.3 1.7 2.0 2.9 2.4 1.7 2.6 Income tax expense (benefit) 0.2 0.8 0.5 0.6 (0.0) 0.4 0.5 0.5 Automotive interest expense 0.2 0.3 0.2 0.3 0.2 0.2 0.2 0.2 Automotive inter
Slide 37: Impact of Special Items on GAAP Reported Earnings
Impact of Special Items on GAAP Reported Earnings ($B) Q2 2022 Q2 2023 Adjusted Adjusted Reported Special items Reported Special items (Non-GAAP) (Non-GAAP) Total net sales and revenues 35.8 — 35.8 44.7 — 44.7 Costs and expenses Automotive and other cost of sales 29.3 — 29.3 36.6 0.11 36.7 GM Financ
Slide 38: EPS-diluted-adjusted Reconciliation
EPS-diluted-adjusted Reconciliation Q2 H1 2022 2023 2022 2023 Diluted earnings per common share $1.14 $1.83 $2.49 $3.52 Adjustments1 — 0.12 0.65 0.82 Tax effect on adjustments2 — (0.04) (0.20) (0.21) Tax adjustments3 — — (0.33) — Deemed dividend adjustment4 — — 0.62 — EPS-diluted-adjusted $1.14 $1.9
Slide 39: Effective Tax Rate-adjusted
Effective Tax Rate-adjusted ($B) Q2 H1 2022 2023 2022 2023 Income Income Income Income Income Income Income Income before Effective before Effective before Effective before Effective tax tax tax tax income tax rate income tax rate income tax rate income tax rate expense expense expense expense taxes
Slide 40: Calculation of ROIC-adjusted
Calculation of ROIC-adjusted ($B) Four quarters ended June 30, 2022 2023 Numerator: EBIT-adjusted 12.1 15.1 Denominator: Average equity1 62.4 70.5 Add: Average automotive debt and interest liabilities (excluding finance leases) 16.8 17.3 Add: Average automotive net pension & OPEB liability 12.1 8.0
Slide 41: GM Financial – Key Metrics
GM Financial – Key Metrics Q2 2022 Q2 2023 H1 2022 H1 2023 Revenue ($B) 3.1 3.5 6.3 6.8 EBT-Adjusted ($B) 1.1 0.8 2.4 1.5 Total retail originations ($B) 12.8 13.7 24.4 26.7 Retail finance delinquencies (>30 days) 2.4% 2.5% 2.4% 2.5% Annualized net charge-offs as % of 0.6% 0.8% 0.6% 0.8% average reta
Slide 42: GM Financial – Return on Equity
GM Financial – Return on Equity Four quarters ended June 30, ($B) 2022 2023 Net income attributable to common shareholder 3.4 2.3 Average equity 14.8 15.2 Less: average preferred equity (2.0) (2.0) Average common equity 12.8 13.3 Less: average goodwill and intangible assets (1.2) (1.2) Average tangi
Slide 43: 2023 Guidance Reconciliation
2023 Guidance Reconciliation ($B) Year Ending Dec 31, 2023 Net income attributable to stockholders $9.3 - $10.7 Income tax expense $1.6 - $2.2 Automotive interest expense, net $0.0 Adjustments $1.1 EBIT-adjusted $12.0 - $14.0 Year Ending Dec 31, 2023 Diluted earnings per common share $6.54 - $7.54 A
Slide 44: For Additional Information Please Visit
For Additional Information Please Visit: https://investor.gm.com investorrelations@gm.com https://www.gmfinancial.com/en-us/investor-center.html investors@gmfinancial.com GM’s Investor Relations website contains a significant amount of information about GM, including financial and other information
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General Motors Company — Q2 2023 Earnings Presentation on 6ix