GM boosted profits at STLA’s expense

General Motors announced that North American profits rose to nearly $4 billion as its revenue hit a record $41 billion—a 14% increase. While the margin may not have been as high as Stellantis seems to demand, GM profits were high and inventories were under control.

GM operates under a UAW contract very similar to that of Stellantis, and has invested heavily in making electric cars (EVs). Unlike Stellantis, which has not issued any statement regarding profitability from EVs but continually complains about the cost of creating them, GM expects EVs to be profitable in the final quarter of this year, and has cut costs on gasoline-powered cars by reducing unique parts and build options.

GM said it had strong demand and high transaction prices in North America, with higher volume in full-sized and mid-sized pickups. Stellantis lost a good deal of sales in full-sized pickups and postponed its promised new mid-sized pickup by one year, beyond the reach of the current UAW contract; Stellantis also said any promises made on new vehicles were subject to market changes and therefore, one assumes, not to be taken seriously.

GM raised its full year 2024 guidance to an adjusted earnings before interest and taxes of $15 billion, as Stellantis dropped their guidance. CEO Mary Barra wrote, “I want to be clear that we are not mistaking progress for winning,” as competition and regulations both intensify. She said the company was focused on higher margins for gasoline cars and profits for their electric cars. (Tesla, which only makes electric cars, had substantially higher sales than Stellantis in the last quarter, and is operating at a profit.)

Stellantis remains highly profitable in North America, but has continued to remove jobs, shut down facilities, and cut future products as leadership claims they will be losing money in the future—quite likely a self-fulfilling prophecy.