General Motors (GM) 25 Apr 232023 Q1 Earnings call transcript

Good morning, and welcome to General Motors Company First Quarter 2023 Earnings Conference Call.

During the opening remarks, all participants will be in a listen-only mode. After the opening remarks, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, the conference call is being recorded, Tuesday, April 25, 2023.

I would now like to turn the conference over to Ashish Kohli, GM Vice President of Investor Relations. you. Thank

begin. may You

good review We the GM's of and us first you as XXXX. we financial morning, Julie, appreciate everyone. joining quarter Thanks, results for

on this call and were conference Relations issued Our are materials available GM's Investor website. morning

via this We call also webcast. are broadcasting

Vice today of Executive Q&A Cruise. GM President CEO and us Dan Jacobson, Barra, are Financial, Chair Kyle call. the of join of the Mary Berce, portion and Joining CFO; us will Paul and CEO; GM's GM's President CEO for also Vogt, and

we I'd the content governed first our Before begin, your be like attention language. The forward-looking page to to presentation. of direct will this the our call statements on by of

I'm the to turn that, Mary. call with delighted to And over

for efforts I team, unions, discuss involved, Once helped Dan our joining delivered appreciate us. Thanks, everyone customer and demand with including strong products. quarter our suppliers, of our Ashish, Paul, are for opportunity to GM to you and have the the our that this meet first we you. dealers, strong results good I morning, and again, Thank us glad Kyle, earnings, all our everyone.

inventory any commercial well sales, as of XX.X% U.S., and did in Highlights in and automaker, increase markets a margins. production quarter, discipline China, we outside share North and including retail we the EBIT-adjusted earned pricing. America, sales. which market include we and fleet record with We In earned are the where year-over-year leader the had of international our as U.S. largest it consistent market strong

points. sales position our to record moves quarter, the Bolt EVs the LYRIQ deliveries. up basis of This more EV by strength than second and XX,XXX on Cadillac in delivered U.S. We XXX share increased market rising the EV market and and EUV us the in

to margin. more anyone also a U.S. We than the trucks by in sell continue wide

the fixed faster cost these enterprise are we of originally billion has $X reducing empowering targeting have reductions our And and value line because will greater bottom will their reductions billion expected. through we're results; than flow we're fixed leaders even which to cost $X In bureaucracy; the we addition, we value be the teams of than are voluntary will to executive culture, by strengthening than to consistently structure more agile. ranks strong XX% separations, and which our help more delivered reduce our faster of

to prioritizing programs the are we accountable holding highest We projects impact. ourselves we're so every addition, have day. drive cost to In continues revenue single that be and understand the and raised, bar improvements

new at of and we the and world XXXX the the the to full launches, support on year EBIT. guidance billion. our ICE and ahead around performance business we strong new mix, us The As are EV $XX look we're launching opportunity products $XX of build to this billion earnings to range of with momentum ICE will able a and raise pricing

orders new at new the GMI, the is pickup XX,XXX growing, out a Trax, gate. heavy-duty week for In first of XX,XXX In orders than pickups in start sale. midsize new of the is Chevrolet in very more America saw Korea demand the more fast Brazil, And and Montana in high with Chevrolet placed the especially North off our end. than to

and truck the manufacturing through offerings franchise. niche design, Cruise. it like last we've our investments, evolved years, premium technologies And a did Over capability we from to Super a demonstrated

and Colorado, responding. the ZXX, of for XX% new Boss our dealer and orders Trail are customer models. high-end customers ZRX Our Chevrolet

that didn't top-of-the-line the orders is for orders are Canyon Denali XX% for for model GMC Silverado was XX% new are of a heavy-duty model. Last are GMC Last Chevrolet which XX% ATX And of Denali exist XX%. orders and year high-country Ultimate, higher-end it of was year, models. the the year, the it a XX%. ago. Sierra brand-new HD

growth into profitable extend as Our segments other well. opportunities

For win that customer customers Envista us will example, Buick help vehicles the GX and or and brands and scaled-back Trax walked from choice. Trailblazer away new Encore Chevrolet the from affordable

are a safety small and with long starting these starting technology designed, of standard beautifully all technologies, active include MSRPs $XX,XXX, of and with SUVs list packed driver they $XX,XXX. yet below below the four Trax All have assistance

a we've a the above the of how residual. ever just segment. As vehicles earned done and lease XX are, Trax in measure generation best points good the these previous this XX% That's

the affordable. the are said time, and that the writer sandbox our teams' resembles market go, and premium technologies it's as software As for be as master playing manufacturing gorgeous we and Envista are because its and the alone, in volumes cell said, EV another Lamborghini Envista, one production same hardware, rivals auto rises styling XXXX and our far At both deploying. share the as growing new might

North As year America this of of Paul course that in 'XX in half half the and first we the to XXX,XXX plan in 'XX, EVs the I and of XX,XXX second the have produce over EVs XXXX, including shared, half. double and first

far So us year, rise production more meet continue help LYRIQ, Cadillac to will demand. X,XXX pent-up and built we've this to than

Both zero, production GMC HUMMER and EV scaling. models are shipping is from factory

SUV. Our as pickup we HUMMER carefully additional the add cadenced is trim EV to and began ramp of EDITION production production series X

customers Ramos preparing and and the at and making BrightDrop the have for team at XXX the added production year, in now of team EV, the Arizpe EV EV vans, Zevo Blazer of XXX Zevo the as we've Equinox We half the the KMI great for fleet begins and progress second Silverado the is second launches half year. the in the of XXX built and already Ryder Purolator has customers. The XXX than more

Ultium weeks. of in next-use begin is at we the including LTM reach where of to applied we a capacity production by the rising at learned in to workers plants, be of end in hiring expect production full and this Tennessee, in our cell Everything Cells will will Ohio, year. we All enabled training which Ohio matter

EV. Orion Michigan in Township, the EV plant assembly to build our Chevrolet Sierra GMC transform to continues also the Work Silverado and

it's of Chevrolet to end will have time to the which that plan so EV year. now the We Bolt EUV the and far, very production, at happen progressed end

production, reopens to and XXXX this more trucks. to employment nearly XXX,XXX assembly have full terms expectation, are up our and reaches we'll in and EV and company-wide that EV Chevrolet than capacity triple, need measure We'll mutually build because customers' our GMC Orion exclusive When annually. and range electric trucks capacity work trucks a demonstrate will we'll not for

tuned. So stay

technology to we scale cost range we're optimizing drive also using fixed working at we announced will our Samsung and EVs, this at improvements pouch energy that Wallace partners. and new Center approaches SDI As costs Day. Battery morning we our margin to by This density, pioneered will Investor and And outlined add we cells cylindrical cells with for continue portfolio. to lower our and our prismatic includes

above Having in partners EV cell significantly North complexity annual cost. America use reduce us priority. and another assembly directly complexity our the million and multiple EV programs will between to integrate is to and allow expand subsystems expanding of weight, strong grow packs vehicle cells into capacity Reducing new units quickly, into more X and ICE segments battery shared

reduction complexity, software XX% can we experiences infotainment and important overall delivering example, all For reducing ICE future the our of by products. the focus entire quickly. part new much hardware screen on efforts related One includes on are complexity improved EV configurations more of configurations By our and reducing digital across our and of we portfolio.

which favorable expect CAM, will even as advantage 'XX, commodities also of 'XX We we've in to will competitive significant other the quantities bigger terms. supply starting material commercial and our that and on as well investments us purchase chain an nickel made because of in direct be lithium, allow

this will traditional can't the together of fundamentally coming deliver is a way EV automakers in competitive All margins. that narrative change that

the trajectory, get work and there people I a we but faster think. have have We much believe can right do, of than lot to we

to I Now before call expand of which like share to the would to I to an scale on continues Paul, the scope over Cruise, its operations. Kyle update turn and invite

Kyle, over to you.

over progress. like Mary. has X.X update XX% give completed our our fleet and brief XXX AVs. last We've accelerate. pace driverless driverless million continues concurrently Thanks, to quarter, by XXX increased to from the to Since operating miles, I'd on a

while miles than Our less will take first months the XX million million us to complete, next likely took three. miles about

over passengers from our and in we've users. significant limits had seeing early This quarter-over-quarter when retention liked, it is day, regularly on every strong We're growth completing where we're and with also trips operates. driverless but our X,XXX services well

San of Francisco. excited portion today, But hours of a I'm day now to share XX right our a fleet that driverless all across rides serving now, small is

to this driverless is as We're value. commercial the driverless it the fleet years making work to roll we of fleet soon has that the and can. needed us, in rest a our milestone represents real completing our as out For

of vehicles. supply a key of rapid is part scaling readily available Another

This of launch hitting Origin Fortunately, AV, and track the validated profitability ahead and our revenue Cruise testing Austin test-mile our in of and step vehicle billion is time-consuming purpose-built a today. on towards been expensive our collection. path and will on reducing almost in cost-optimized remain simulation, $X on entirely critical well XXXX. Origin, has to supervised historical the in slightly be reliance as We The in as soon.

to you. Back Mary. Thanks,

now Paul to over it deeper for turn dive And to I'm going quarter. Well, into thanks, the Kyle. a

execute same year thank the and continues and leveraging for has We're for pleased Thank our as a strong Kyle, important I'm vehicles time, new everyone. us with pricing morning, and products, while ICE transitioning stable. while Mary, to report you, our on team you, our the Thank continued to at joining to today. refreshed good business, strategically you portfolio driving robust demand transformation. start the the remained

on to half severance individuals, in the took the in mentioned, EV in exits occurring $X $X cost of battery majority benefit performance-based expect as the in towards X,XXX implementing XX% towards cell at roughly the with participated this billion also Ultium realize in now increase initial incremental We're we program, bring half And The voluntary back will volumes, the in Mary year, initiative, of billion we year. XXXX, which as Cells. our to who the this approximately we about target. of drive of excited steps production QX particularly second

crews, which do on cost revenue on from the is areas billion do and on. But bright the like vehicle our initiatives: in design growth just from We're following business, reduce initiatives. the of complexity everything. across drop cannot software-defined $X and focusing and focusing we the several projects come returns we're actions portfolio everything and offer biggest engineering The people throughout will We margin. vehicles, to remaining prioritizing one simply to manufacturing;

These of a our we at November And Investor additional discretionary we corporate medium- have outlined and also but spend. which lastly, aggressively IT in travel, we're a costs, on and marketing will on actions opportunities number near-term long-term being impact year, pursuing. Day tactical costs overhead to costs, last are including

battery integrated portfolio approach fully and a For example, developing we ecosystem raw taking materials. are to battery a

mix of scale advantages us source the miners, established will of early-stage pricing lower from as We of supply are the into a back volatility. half we and and giving meaningful both decade. These security

The cap under the year. Treasury validated also work guidance the Department's energy of with recent this fleet our EVs full for clean consumer battery entire $X,XXX chain supply purchase incentive on incentive our MSRP the qualifying

discuss let's Now dealer another inventory. topic, important

with As call, with X% last points some gained downtime, to which exactly earnings is and on to ease volumes our in did to end to that's demand, and dealer we X.X mentioned year-over-year. compared allowed started supply what the the we and stock constraints plan of production improved increased supply quarter. we flat Early quarter the share year, as proactively while began us plan December, outpace to this balance U.S.

in These the at out were actions year. our production XXXX laid metrics of guidance contemplated beginning the

time. SAR planning to deliveries unit million XX us out of take are range XX targeting seasonality to total We and XX and end still of with time production of from to fleet to schedules dealer this XXXX inventory, days timing although may a

lower was Now only business providing underlying a achieved Revenue despite $XX the results GM up in remains $XXX headwind EBIT-adjusted, $XXX lower We income year-over-year. million $X.XX pension earnings, billion diluted year-over-year, combined were adjusted. in let's EPS strong. that get into financial XX% the billion, million down QX margins evidence and $X.X and more X.X% EBIT-adjusted from results. quite company Total

auto working cash timing. driven year-over-year, was Adjusted capital free Financial headwinds expenditures by dividend seasonal higher and related flow GM to EV investments, flat capital essentially our

in retiring in However, later shares our X repurchase $XXX balance of to million we billion million stock $X.X this retiring early QX, strong used maturing year. and debt sheet

flow $X.X our to increasing $XX results. on the current in results $X.XX to our full $XX QX billion are in regional Given to billion more strong range to guidance EBIT-adjusted cash cover billion the after to we provide billion $X.X and the EPS adjusted $X.XX free details range, the outlook, I range. and diluted year automotive this the adjusted I'll

of of income, and costs. offset higher EBIT-adjusted QX and lower EBIT-adjusted were by reserve delivered and year-over-year, adjustments XX.X%. warranty pricing $XXX up commodity mix, higher million and America primarily partially margins by Results billion, driven $X.X volume, North pension logistics

largely $X.X carrying saw We billion driven a price by XXXX. into tailwind pricing XXXX quarter, the in increases the in year-over-year

We year-over-year moderate through benefit we the this pricing as year. expect to progress

all-new performance to However, our offset HD on midsize headwind. we anticipate pickups pricing partially this and pickups refreshed

strong, Demand our for sales with Sierra Silverado full-size of pickups full-size up X%. year-over-year and remains increased pickups our total

essentially steady demand We also has well our of pricing number April-to-date are in total consistent, flat, industry pickup position been volume. seeing in gained we're a as performance points continue healthy, also trending full-size Encouragingly, and X.X increase market to percentage one is levels sales. share inventory remains

of that lower EBIT-adjusted flat China environment been million greater-than-expected impacts, due down pressure, in aggressive offset. actions. pricing China and in volume continued actions $XXX competitive largely cost the was regulatory pricing as China income The industry challenging by has actions. navigates The for delivered very QX to the GM is equity million, vehicles ICE year-over-year, to taking and offset partially fact despite $XXX EV COVID-related and team both International changes

an improvement don't we year. expect the However, half second the until equity in income of

mix, headwinds. up were pricing, team GM with The year. by and International, has $XXX turnaround offset over continued and few higher equity logistics was volume record million, past years over the excluding the million last commodity currency costs another partially in by versus EBIT-adjusted executed The results foreign and income, quarter. driven China $XXX successful

a FX For year, covering we portfolio up on the pricing the more headwinds. strength be the leveraging full expect of to year-over-year than basis, and

in are moderately For for GM offset full momentum International, results International the year than more continued XXXX anticipated of to GM rest improved to results anticipate China. headwinds relative strong and 'XX. we The

as yields Financial expected new of quarter $XXX primarily by net expected, growth vehicle production result it of higher first Also, to a results income, since delivered vehicle adjusted reduced year-over-year, GM due portfolio. funds cost gains mix sales EBT partially million, the terminations. impacted by of loan QX effective lease on the on offset was down in driven XXXX over and leased higher lower new lower $XXX versus and net million in lease decrease XXXX, as while originations

enterprise ability cycles. providing impact metrics, support economic material balance We've to to recent liquidity seen key GM remained and Financial's banking sheet the due no strong, them the GM the across crisis.

$XX we earlier bonds and funds credit In a revolving issuances receiving debt cost while future improve and improve should fact, of of reprices. this GM Financial on upgrade month, Moody's. portfolio were upgrade able to credit bond GM ratings our spreads their This billion renew also as facilities from

GM Financial in $XXX GM dividend a also to paid QX. million

we year-over-year changed. to and continue expectations down of Our the Corporate not to the GM financial full dividends EBT year expenses $X growth initiatives. as quarter, $XXX XXXX slightly have in in million billion in adjusted range mid were similar invest

by year-over-year, stock-based the Crews in quarter increase this QX well $XXX million by XXXX. the compensation million inclusion $XXX spend in expenses an as of as expense driven operating up quarter, were versus

forward rest look of the agile our to dynamic we macro to the year, environment. adapt goal As is remain the and to

and incentives Our in price year pricing gradually QX is the updated cycle rest increases saw neutralized we benefit XXXX the guidance assumes the as we of taken in over increase. that

due higher contracts. logistics been costs and to estimated, have on stickier market originally than primarily prices index Commodity steel

modest For be and prior for year, flat costs versus tailwind. essentially we expectation now the full commodity logistic year-over-year expect our a to

is from least tax expectation energy XXXX $XXX clean credits EBIT-adjusted the benefit unchanged. Our production at million realize to in

did still quarters to improve next we issues XXXX X% in these And to QX, increase we volume wholesale logistics challenges the therefore, continue over availability are, XX%. and as gradually few expect and to experience we parts while year-over-year to expecting

we mentioned, our towards EV North Mary in X units XXXX. great As progress of million goal making America are capacity of

will strategically low platform deliver segments, the margins in see and to by As important us EVs we in high-volume help multiple and we benefits of digits mid-single the scale expand XXXX. launch the Ultium

I all In and want my of to two GM's members after potential long-term our profits optimism proud high. for how for years very efforts. Needless quarter to amazing I They've delivered of quarter thankful record also tireless their and despite external say, many executed am say remains closing, challenges. team for consecutive

our comments, concludes portion and opening the call. This move Q&A we'll now to of the

first Instructions] Our John question Bank [Operator comes with Murphy from America. of

open. is line Your

quarter the of I profitable year, time. lessons that that's mentioned course just mix through there the pricing couple wanted would the have last you are of that for to creating -- to and upside the business seems over first years managing be and price But the close something to been and some learned Paul, it neutral. like on reverse more

managing player, gained an just like into do about curious lessons what you in I'm are even be sort the you mean, kind give the going learned, able what you how four So being that the forward? the But current Tesla, think you from cutting launched. back though mentioned might of crossovers market. this in mix. And I were leaning HD face products first increasing and that that something price think of level higher the below to the threat that's of Because other this going in mean, if price quarter is that you then you talk about maybe I the Mary, you're is refresh, large can aggressively one maintain do you the XX,XXX, seemed in it pickups direction.

today. us Thanks Yes. kicking for off

around I of going think us. year, in the there's macro. the to were somewhat just we And in conservatively unpack conscious be recognition that planning to saying as by we your environment think need question. into lot said, I'll we start a macro I of very

normalization with XX and little seen QX. pricing incentives a in units some of bit SAR we about million certainly hadn't lower demand, to a that So

we've guidance, some up, can that the conscious macro. across forecast, that of sure we expect would And certainly, the And But make very comfortable because think that our I up reflected results that we're of still we if these in to see I despite half. we're we we back outperform hold demand taking the board. want

digested learned, was this a well, at weeks of vehicle plant When have balance steps And for I back important think those focused I to demand. down I'm certainly we share couple And increased volumes think, margins. capacity we when all to have really that to the the really sure period, to about the that I one I of you on took lessons market decision gained not learned that that asked a the quarter, production when we that think while forward. can time future look you is going inventories of on and valuable lessons we flat one over think take

demand trim responded mentioned the So, were clearly, a level on seeing for in you we a exist see Ultimate. strong trims. side, the for the their even ago, asking her and is demand year for with yet the trim didn't higher-end they've are remarks, it, what Denali is customers Mary that This orders.

So, for going lots think business we I forward. at, signs think encouraging about lots how to look there's of the

work done been the we've levels, the at for reduce the doing having we affordable components well mentioned. But right to end, very to because add, of Buick you I that Paul to Yes. across the really have and leverage able -- We're just John, high and vehicles. portfolio especially the would have the complexity also scale that Envista at Trax the that do trucks in the we've market. profitably of Envista, the

For instance, powertrain. has only X the Trax

about have think when people you that still way but market you a the doing mix, opportunity, in what to So, cover it can you've afford I I think talk for the well. big think, reduced really one lessons we're that learned, portfolio, the the continue I portfolio across to and going as complexity, the to but only ICE drive of is not EV

that I do two-shift Do adding might that North I require actually -- where And data, of up I than maybe like balance financial in you absolute in if lines that maybe execute higher step ask drop. extra I later would that? a given seeing on the in follow-up. shifts? CAPU thought. Taking That's straight into higher shifts. of this The America sort where was you're is have do one going much mean, you you based year? to just outlined are. it That's could And do on was just of volume mean, thing add how time. how you third you you sort get this XX%

managing adding You're lot going you now. right I you And optimal growing a start third optimally shifts, very XX% less volume, particularly as you're CAPU to that think the with start become if business number?

trucks we've where so time. varies full-size and out been obviously over Yes, John, it we SUVs are we pretty as much can running flat vehicle and type and by as on pickup

So but little got of we've aggressively manage a the something there's bit to board. across really that that's margins, the

are there the Should it think, be opportunities So, that. to see I demand, that of balancing most demand pick important we able piece to as can. do is we to up? But

the of if logistics finished, as the to components moderate that. move for some to shift inventory up take we centered down making sure well you'll see think around us too. be are to do we've to it So, it's as and those when make got really able capacities and that parts I the to growth, Opportunities need

But cost say fair to comes that's in? all that variable

Absolutely.

you. Thank

question comes Citi. Itay next with from Our Michaeli

open. line Your is

for questions two Just me.

scaling hope can informing metrics safety relative a seeing miles, future And on of, and on miles for is the expectations? you'll you're Paul, how experience year, -- of April, was for I X.X could about bit mentioned in any production that a, million for maybe you to an the share bit the America a hoping the we the performance product where on for First, metrics trucks? rest congrats talk the particularly then start secondly, those And how think have ramp maybe Mary should for earnings the the maybe, you with intense North you strong you the Kyle, driverless and cadence about plans and in Cruise?

thanks Yes, the question. for

we the the alluded I was cadence full the guidance we thought was going challenging. on to So, think The guidance. on half year more that be second to original side,

lap well So any building of there increases where see it. of last are that's as price as the in downturns demand, we kind we year as

So, second half little half. it I watching closely. We half, first bit second got of to a time be the We're story. to it's would a able say manage still

As in we to has April remarks, has prepared well continued the strong. us strong said very been as for be and

So, I still there, would we that the guidance bit say with one risk out the but little second a it's that even today. lies that half, in felt comfortable raising our

want Kyle, do And question on you to scaling? take Cruise the

I Yes, that. do can Sure.

quarter, now. are just on we this size side, way going. We'll very So up right move last in of on performance down more rapid just continuously how almost scaling, improvement to the soon. have in safety share up and phase fleet continue. burn that's or strong. we of our we that, for expect doubled that rate that we've we some scaling scaling we And another out is do and with But And the that keep the our the one happy of so as kind it fleet. surfaces to can We're bottleneck

Thank you.

Rod Our next Wolfe Research. Lache question with comes from

open. Your line is

market. in It's can you maybe the aggressive narrative. pretty like margin EV address great the I'm seeing does competition that developments and we're the changing about broadly China North look the in EV is both areas. in hear America hoping comments It just to

are of color America could dynamics as is And market real there just you Maybe kind strategic seeing to So surprising on time. provide little you? China? and you the observe how I both you was are that adjust in anything markets, you're you in if strategy a making North that adjustments wondering,

-- Rod, the question. me let So appreciate

China. with start me Let

still Pricing utilization. industry at is you recovering XX% very aggressive, now. of as Paul China, in got And As pretty is industry tough you fundamentals when you COVID. the It's look capacity said, from right know. the the

there's profitability You've and I I can perspective, country a competing. still be little look a look growth, XXX think But longer from tremendous that's mean, don't I strong that steady more have think can at. than and a the you got brands great if term still you market potential. state

we're launching perspective, Ultium right GM-specific a EVs from now the platform. right off So the

we right improvements 'XX across only that compete be but then at aggressively going allows as will we're operations. we and to perspective from our get are to EV price 'XX the products market in China I a not across us for also think structural us think that the years be pursuing key cost profitable, right

China industry So to in is is that the now I will the the the have number brands right be because positioned. do a and going of pricing the country, have where sort, that period we'll I there. think well we're and of in value and We with challenges competitors portfolio right have think EV

And frankly, portfolio ICE is right our strong. now,

assembly the From that's so funded U.S. going at and first a And the challenges. price is a to we main we're at now the LYRIQ module, then launching it's -- fund same out perspective, to look also getting time, enable us EVs as the plants, our with battery focus right from is One the twofold. vehicle the vehicle, Ultifi. Cadillac the launching We're the perspective, there. really

why said that. the accelerate, when where So to flowing new. pack, is that we focus really ramping, that is now, which That's plant very is and now why at we're cell to do enabling of very as to there's doing. That's cadence the we're beginning a module start going have and half the measured you're us curve second a battery on on we're see to the really we well, track even and the year of lot

mid-XXs. it there, vehicles Equinox When the I And XX,XXX think is on focused then perspective, the These the when be right look So with. to the from because in LYRIQ great. begin vehicles the going Blazer the I to a below XX,XXX; around them or think at starts price are we we're right you important. getting think we at really price that where out styling technology below, look very you at are they're XX,XXX; points at

While so we're strong, out there on we're customer working to really costs. because working response get these also the vehicles is

well doing drive EV $X that ICE billion a reduction structural that, perspective. on we're And is, we're as then looking we But And both how working tremendous indicated, the do those continue continue there. also and to on margin to so, there's from for look at an we're the cost going work and of we'll opportunities. Paul amount improvements

we So work continue costs, have can the to only going to well positioned But also that. believe, the the I XXXX. both for you and Italy, right challenges low- critical be achieve commodities, in around the the not focus but is margins as the -- we said, count Paul of pricing mid-single price and now, a we get right pricing are low to still with out, on mid-single-digit that vehicles we think even year this to so pressures,

on kind talk And just the amount obviously, you America? little billion And comment given of that of $X cost on we can North Great. the bit just of in that saw spending about costs, increase a the of mid-decade. components over keying off time, extent your thinking provide costs the in the we on and through the Can growth points that to about you be of some to should which initiatives, business? that certainly going go how trajectory changes up, structural are just thoughts breakeven

Rod. Thanks, Yes.

in higher had a we things. commodities lower On a America, pension and income, the costs, costs particular. little obviously, in logistics of So bit couple North

a uptick also in We costs. bit of saw warranty an

an of the across think bit repeat year won't throughout anomaly probably a I that's and the board.

being fixed placeholder as the about, said, the cost we're getting, So, program. that talked $X early traction on like I voluntary reduction, billion we the on still biggest controllable

really begin to the and late quarter So second accrue get savings start into really in the then savings will bulk the second year. half of probably $X billion of to

program, the really and package. a to good was chose way take who that that to kick employees that to So start grateful we're

grinding overhead as of side going lot lot we is talked forward, on a of other spend. discretionary a around about The

costs, in that got pretty the traction think as are on teams discretionary we getting savings well. get things costs board. we we've focused quickly across So, those spend, IT-related And marketing-related can on that

we with to XX% into So, where that's XXXX. accruing getting the feel remainder this year, about confident

of for the just pressures, think, to is more for not some the long that competitive Company. talked some an important, near-term about trajectory continue improve this dynamics Now those the effort but to offsetting we've of the term in margin I of

Paul, something be that at be color, spending intermediate any that growth of of initiatives, can capital that? would that level you you're structural outlook some uplift kind Is amount the who Just the the there'd for sort this costs? that to with and think held on think of term

obviously seeing where that's billion in recall, program if Yes. in but D&A, and that about you we Well, -- savings. some resulting talked we're pressure the $X offsetting

we're going do. that comfortable to That's we for. one to little but aiming can So bit of feel get that hurdle what be a over, we a that's

Thank you.

comes Dan next from with Our question Levy Barclays.

open. is line Your

buybacks. Interesting I as did an ask as are buybacks your about First, I'm But speaks see that share that in growth wanted you question share going quarter, and the open to approach type cycle you to liquidity your on on the profile. the you that and we're in spend guessing buybacks? ramp to going confidence into, to how there's to normalization -- of need share

as cyclical but our Well, allocation I we capital generation think what cash through at, first, business. in our we're quarter, move the look -- you and year, saw when is framework you reinvesting following first the the in

that the lead growth expansion and tremendous are this products, the that ICE we we've an margin and some to Cruise as growth BrightDrop from as well. that right are transformation, make on really to And going have both -- we we have we focus and an businesses EV with like think along think optimized perspective to

But And to that, cash look buyback. we we year. continue in confident we We to for felt share confident our with that guidance. our that. But the way I continue raising opportunities. confident those to felt be able go do we to to saw We're quarter-by-quarter going overall the feel position as evaluate think to in through doing

I EV the question, the then out second laid target. know you've mid-single-digit XXXX to low- margin And Great.

One great. that, But of question. standpoint out think know Rod's disclose of EVs a standpoint. the on your I of you you're beyond in light don't more If the today. touches margin in position in put competitors terms absolute this clearly so, would in obviously are has contribution be laid out if they where EBIT on environment, thoroughly current they've -- or are where that to an more I

with XXX,XXX be on you function volume? profit balancing that a have firm supply, going and You cost target nimble to But going the very or that given be dynamics Or ongoing of dynamics, to target. target? that going to XXX,XXX be EV is with this the purely are you're

Yes.

I'll can So that. in. Dan, Mary start jump with

we've to I with going we're think targets details firm aren't that, to infrastructure the more clear. of across board. when we cetera, fully now start those EV ramp utilizing the you will stages, the right early in become investment a lot made starting the up, at going numbers that not to that as be et very you look look just Because when meaningful, and profitability, give depreciate we're to already because not that at the

up we to be the realize the forward. So get pricing efficiency scale capacity drive or going the and cost efficiency ramp to targeting margins able benefits to be to need we're to that able the to those

we think look got where sure the is. it's we've to I that So demand make to one that

into quickly talked on We've middle back interest the look for, the orders we a about as we this work balance that that. get XXX,XXX for demand we've the have up of on together to ramping lot the and structurally, the of continue the do do a coming and as and picking costs. that see, to and speed up But and obviously part work can to We've for about we of taken got order and, feel scaling, But X we've the at indications lot announced the of there year. of as we and that you we'll is books that. pretty very all to ones million, vehicles confident

Paul, well. said it you

Thank you.

Adam comes Stanley. question next with Morgan from Jonas Our

open. is Your line

a expect confronted if are EV is way, message with On could interpretation clean least, earn I said energy trade-off? higher the to on -- a numbers But case the you'll million mid-single-digit aside, margins. portfolio here just require and to Rod's it the maybe that's want different to at you credits. EBIT-adjusted putting be Tesla's the But than question be I of low- going before impacts my and of follow in apologize. Dan up margins it XXXX, in again, to from and if both, to that Is you what you mid-single-digit the that on margin, make X in prioritize volume. a economics or my a the choice did choice that you just had choice of of couldn't that doing the you to be do doing kind

to portfolio. depending or Adam, going this our to going quarter, portfolio have, look profitable it's the that for I Yes. third believe going the to second, we're we'll right think that not do I'm I duplicating When we're at you work XXXX, as situation. ICE we're we're not mean, say, on I that, fourth sitting in toward growth. the portfolio, and

that are point We to at right there's have having because in meet very perspective. vehicles you the price get as they're EVs affordability recognizing the to a U.S., an being in sold points customer well, from where where different from the to targeted many competition

in know I you've of And about some written your notes. that

achieve with well we're to maintain look going to be we to the the million value. going the think portfolio, But residual value, we're profit the So the and margins. positioned smart, the value, be brand vehicle with right units X

nimble. going we're to but -- So be

luck reduction. cost products with make -- our put either/or to make continued as we're the So this to do going say, I'd right own just out and we an there,

you, Mary. Thank

Adam. Okay. Thanks,

a point, more And the a of lower are undergoing maybe changing markets saving run of tech I kind just Kyle. or had actions to of a environment. some capital companies cost restructuring lot A follow-up breakeven bit for given way give themselves

a a you actions as of rate huge lot just That's be new taken would in maybe could obviously that on advantage. But reduce I'm identified Now have a GM you to having of the wondering also luxury levels. forward that have a some going if partner burn you environment.

towards looking lot as for more is a efficiently. less question. of I for we the do big Yes. march We've been and really us. run a to focus Thanks which ways profitability, mean, for with

similar the so, Cruise activities the Paul seeing and rapid for focus well to GM, of incrementally really types we're in and results structuring terms therefore, And in there. scaling and board is But getting across those us, what some to profitability. the on closer mentioned streamlining doing of of of good some inside as

you. Thank

Wedbush. Dan with Our Ives next from question comes

open. Your line is

this been has say either you specific production and the cost the would the given from a that's development biggest on transformation quarter efficiency even surprise especially the EV Something perspective, what So happening? side, positive? on or where from

fact I've it's keep to were efficiency. how Great I on screen And would our to pleased extremely configurations I taking we so with the we really dialing ICE do to and multiple been XX%, finding with ways models software then features say about the that start to be the reduce right reducing advantage really how on that EVs, have question. organization the on When drive the by talked of way, well, it as in complexity able ability right platform. by benefits the the

That's Ultium rolled Ultifi. being what's really have now out we that and

And EV they're an strength and execution. out proud a of that customer perspective, that dealer seeing the product I'm think strong gives from so of what the just doing. knew of set, confidence lot reaction to really put is we in products we me the we're I I but also And that overall, that that of a had strong something then the team

finally, even I launches. launches, we're as think had we this haven't And rapid of year many then in a

is than looking as leadership optimize, of aggressively more the is team teams able out, way very a agile. cost complexity, for been become what signified still think we've the the I XX% out, do take are -- of to with structure which the decade, reduce and that more to working to taking

So, really it's have not -- I we're and we the only reducing products feel complexity. right

have we improvement perspective. a the driving really cost continuous mindset that think is from a I right culture

the most I'm are proud of. two those things Dan, So

Thank you.

Deutsche with next from Our comes question Rosner Bank. Emmanuel

open. is line Your

revenue as based assumption a pricing in any moderation of directionally in in of be some mean hoping the on terms of year Is Are then North America. your the your was an costs pieces? other going there important But result a that headcount little in terms right of and way? what reduction. I My some previous the bit cost. guess, I maybe should down the you first think comments, and you're maybe finer for could the are point I balance puts seems, I assuming a it of Paul, question, put of, takes of

I Emmanuel, we say pricing. expect would Yes.

So America North benefit $X.X a was pricing in quarter. the billion about

that we year or flat we're we end but point, we're whether we or cetera. at increases, net of lap -- we we're that's expect that up changes, assuming wouldn't I so essentially pricing As through giving through say et incentives the on planning last for and for year's back some expect that, planning this that pricing

if backloaded. I bit going But strong, to giveback most that's of the outperform then that said rest for I that's that probably a see the like And sort would earlier year. the assumption forward. of So, say to we of continuing little question, be a of we'll demand --

thought logistics down some little a we side, that other from essentially year-over-year. We logistics before. be and cost across moderation board. things bit kind where of We're in pressure in would flat. we've said, seen steel commodities I the and were seeing On now the some be Like

midpoint. the center overall, as and where XX%, up that's production, relatively for X% the year, of So on you we to we're said; pricing can kind projecting flat how at

us, of engineering Company's portion spent what currently the targets are to mid-decade? progress to Okay. some able would And of for EV then by guess, the tell some the is current be you're on figure EV? what prepared that your engineering not and the trying out I you targets, of and And share I CapEx towards to and CapEx we're guess maybe share as EV margin economics, understand I of

Yes.

That the still ICE transformation, about right capital next you through is on going EV over When that engineering the obviously, we're some work EV. at But the XXX% engineering we will and years. the have X/X we expense, we've the capital to now, look vehicles So side. is the side. largely, said go into few and on it's as mid-cycle doing

you. Thank

Paribas. with Our James comes Picariello BNP from question next

Your line open. is

next is costs thinking then just of how you the to to this now should range by $X And Can cost cash billion associated be relative to be the savings year? trending this for the effort clarify end structural year. targeting for the tied we GM's how about this year achieved

So fair question.

that guiding XX%, last expected when end high launched of year. we We're first in the to we to quarter, the get now we program to range. said, As XX% the

of we'll going to think seen. I some come So in about That is ultimately that the pressures we've offset XX%.

a full come of see we $X billion structural So may off costs. not

cash savings the million we don't largely get component from this have is with that. the will things associated costs whether voluntary identified, be significant program. that expect severance $XXX That of disclosed of we'll certainly, we will forward. with year. The of IT, complexity, the cash spent obviously we it's the travel, where charge that The going a marketing were biggest about But rest or some it. associated We

Got the been for starved years. of, Is that fleet it. think the product thinking U.S. about this almost mix year, the think mix profitability of three of as helping we the at this thumb channels of fleet just rule for dynamic? That's for potentially your of -- least mix fleet industry's helpful. general And fleet and I the then in U.S., have for about the industry the

fair contributor view And seeing a we're to as in a to Obviously, business chain our really drive isn't discount a on pricing really is volume to of that we be I historical margins. to anymore. going And strong and it's We're continue seeing there the fleet Yes, fleet side. grow think expect question. gains the fleet.

Thank you.

Our Brinkman question Ryan with JPMorgan. next from comes

is open. Your line

in for a though, America to quarters couple And it needle equity before more like thanks there, a time, want income loss-making seems impacted your of the do profitable. total earlier apart just around of profits used consolidated by comments I too closures. hand, there IO lowest other company with profitable from from flipping a for some be it the because, on on operations COVID on than to ask But and bit China. North than more hand, less was the the to one the mover

around end talk do You're the lineup close see most to to And EV you opportunity as what you such you market. is might probably the any the the of now a can to it COVID the guessing low to there the more So well-rounded at EV gap. that's have or about profitability be? higher-end factor? where I'm restore quarter, you incurred want to strong virus you that it spread one-time need maybe any in then as that other disruptions one-time paradoxically re-openings

kind So recent to those of letter XX,XXX of like half do in XXX,XXX, profitability us that 'XX help and of in in squeeze EVs What comment what in around how the launch, for the then terms And that in along over ramp you China the with maybe actions U.S., Ultium Ultium those about the shareholder the lines, that pricing market? impact operations in the light half? first you some produced your of in does are in 'XX think, can doubling back once your EVs anticipated thinking I EV to China?

that end, think Hongguang a the to think COVID need the EV great be the impact, business. the on we So But is on important now from impacted had really across low country us and SGMW, definitely Mini right China question. And And brand perspective, Baojun from the had we're build I the right right I from have for very perspective, our -- an a impacted with an perspective. strength Shanghai-specific what EV. to we've repositioning characteristics with the brand COVID

the execute Wuling S-GM venture. very so And important that we that Wuling in joint that's --

last good. in-country in couple venture, and the very S-GM we've off them. reaction because market the reception in seen was to good Ultium of and did getting launched just In the vehicles it's launch We weeks, of the some

addition to launched we're do really well also have able those. to got to plans forward. dynamic. the out them be we we'll China, the market. and on that's And new -- think we're we scaled we to just which to getting And pricing will why achieve go structural received, in we're they're So in report on getting it's measures we've those into taking We new, cap-remain EVs on, to as getting already the those costs, aggressive vehicles execute intended and place for Ultium in that continue going because brand and going

mid-single-digit it taxable of target the And then to lastly, I would this recent that just or thought XXXX, which refundable the against last the Great. wasn't low of against yet action, be EV act the Okay. with I benefit tax if credit then is with reiterated Because Inflation at the part. margin to your in then yet the pricing to how battery in the benefits just and and in that uncertainties Reduction JV from When excluded Solutions, you continues introduce target to EV Investor Act. against income, only shared. the November, LG regard encouraging negotiations 'XX about be you Day credit credits -- -- target portion energy would law applicable the any were think finalize it had Energy light manufacturing maybe partner, cost there target was exclude whether possibly the those the

we Samsung, those into into that have from details you to how mean, to IRA. it's any entered updated the margin knowing do Now mid-single low new the the the much the digits passed and that around you And with benefit Act, law, could have JV credits? do JV about regard I then on thoughts from

the credits shared relative JV? to be the would enter start maybe to a that thinking with JV how into finalize partner? additional already you And did going that So into an did your

that. So at Ryan, shot I'll take a

drew I help show around think when just EVs November, sort we we around two of lines gave it, in you that yes, to we're look you at guidance the back going. where

profitability. low credits. this We've for the that know assuming we're world to term, where credits. we're without was are that sure in that first the that the a got hitting So the mid-single aren't goals EV the get we make tax obviously make to we've maybe digits and That's long long sure vehicle to term, focused on you there normal tax for any

So the thing. is one vehicle program

et year of the credits it cetera, $X,XXX is. us to we feel again, be narrow would We $X,XXX getting might we million We said gap estimate and tax to that. The did thought. short get originally on specifically it, out the is we across board. vehicle about that between about going about parity shared, faster what low comment on second say ICE in $XXX not to profitability piece tax to vehicle any mid-single-digit the that the per to expect the that vehicle that our than of themselves. term, to But that on confident this credits We're helping deals, how

those have about go term, So ways how to by are we're longer to the stand the But we thinking it. that got vehicles themselves.

you. Thank

comes Our from Colin with last question Langan Wells Fargo.

open. Your is line

think of be targets sort on supply. be to to about material XXXX. to the you thoughts in industry? that lithium And leading think XXXX get you in you've place you capacity Curious raw hit you there's I EPA vehicles so what considering the the far. there, the have seems lithium targets? could will good by Do think guess, of then to are get about do EV we GM enough require enough by your securing XX% enough Do been getting in pretty capacity

that We lithium Paul it driven digesting as has climate out change. is let talk about to combat appropriate. can targets about sure bit to increase what got you going we means, a because customer through to else more on we've support details the out, make the that productive. this specifically. I'll being able continuing still And talk when lithium. little put -- demand, understanding -- 'XX being not into But and to we'll the at look is be what what's put by anything dig provide 'XX driven about we're be to Paul, EPA there -- then do them, specifically comment we're to But

Yes.

a longer-term across both do, we making ambitions. We with thing the doing we've not a Colin, So from been material also partners of for prudent battery lot work get to our security but that's to obviously, spectrum. supply scarcity perspective, of think a sure entire the for only raw multiple

looking at, year? for not that partnerships. or at this a We're we for procurement we're forming just year do contract big long-term looking So do

then joint that all the target So really relationships we And got do million vehicle structural. said by XX% with targeting we've X XXXX. set in where in to see POSCO, the as we've We because whether that's the Lithium electric XXXX. with venture vehicle up we're XXXX focused work Americas, done these did ultimately, and it's getting we're you production

now I securing infrastructure that we're think where building advantage. So is an

target also just ahead you're for two changes does could next contract, Got to in potential $X check, the the that years. it. wanted because incorporate of I And the annual bonus billion that your the UAW guidance like that signing the occur this the like from is that flow costs? UAW things sort of cash year of and add terms in stuff some And contemplates might contract?

working the sure make We leadership, are negotiate here. with working know together a solve to issues are then getting going identify negotiations, and We're sure the to we're building strong a the the challenges media becomes to of to we even we -- them at to new we're in place. and I good what it not aren't and the to mean, the making business get relationship

can I say And But done what the with continue to we've past, do. we'll we've in that so really beyond and to going drive always that's efficiencies, would we're that, not what we comment. demonstrated

and strong close All really right. believe reiterating I as have do, where deliver to of right EVs, lot continue we place execution the And all of I Well, have by work lot in what appreciate as the everybody. call. results. believe opened I we GM thanks, really products strategies And your questions a we shines. ramp to said I we a today. to that's to want there's I up although

We have what that's capability the going it to to people exactly that believe to going think. execute, we're And most we're than and I do. do faster

expand we Ultium. milestone they EVs really have for this breakout as And coming, think In I it's the a with year addition, their to operations. continue Cruise a for year is commercial that

and your really forward along I So appreciate the I look updates to time today. sharing way,

everyone So great day. a has I hope

you time. participation. this you Participants, disconnect may for at your Thank