Question

How has General Motors performed in terms of revenue and profit this past year? (has revenue grown, did profit slip)

How has net income performed in the past 4 quarters and 5 years? What is the market capitalization for the company? Has it grown in the past year?

Please cite sources.

Thanks!

Answer 1

General Motors (NYSE:GM) said that its U.S. sales fell 2.7% in December, as sales of its new pickups weren't strong enough to overcome big year-over-year declines in sales of its sedans.

For the full year, GM's U.S. sales were down 1.6% from 2017.

Most of GM's rivals also lost ground year over year in 2018. The big exception was Fiat Chrysler Automobiles (NYSE:FCAU), which rode its pickup-and-SUV-heavy lineup to a solid sales gain.

Automaker	2018 U.S. Sales	Change vs. 2017
GM	2,954,037	(1.6%)
Ford Motor Company (NYSE:F)	2,485,222	(3.5%)
Toyota	2,426,672	(0.3%)
Fiat Chrysler Automobiles	2,246,467	8.4%
Honda	1,604,828	(2.2%)
Nissan	1,493,877	(6.3%)

GM put a lot of money and effort behind revamping its entire line of crossover SUVs in 2016 and 2017. As expected, it reaped the benefits in 2018, with five models setting new sales records:

Vehicle	2018 U.S. Sales	Change vs. 2017
Buick Encore	93,073	5.7%
Chevrolet Equinox	332,618	14.5%
Chevrolet Trax	89,916	13.4%
Chevrolet Traverse	146,534	18.6%
GMC Terrain	114,314	33.8%

Midsize pickups

While sales of GM's full-size pickups were roughly flat in 2018 (more on that below), its one-size-down Chevrolet Colorado and GMC Sierra each had a good year; sales were up 19% and 4.3%, respectively.

The Chevrolet Bolt EV

You may have heard that U.S. sales of the little electric Chevy fell almost 23% in 2018, but that's only part of the story. GM only produces the Bolt in one factory, in Orion Township, Michigan, and exports it to several markets around the world.

What happened was that demand in Canada and South Korea exceeded GM's expectations, so it sent more Bolts out of the U.S. -- leaving its U.S. dealers with tight supplies for part of 2018. We won't have final full-year totals for another day or two, but it's already clear that higher Bolt sales in Canada and (especially) South Korea offset most or all of the decline in U.S. sales of the electric Chevy.

GM is already addressing the supply issue: It increased production of the Bolt in the fourth quarter of 2018. The company said today that it expects sales of the Bolt in the vehicle's major markets (the U.S, Canada, and South Korea) to rise in 2019.

What didn't work for GM last year

Full-size pickups

The jury is still out on GM's all-new full-size pickups, the Chevrolet Silverado and GMC Sierra, but we know this: 2018's sales were flat versus 2017's.

To be fair, GM was selling a mix of old and new models for much of 2018, which complicates the task of gauging the new trucks' success. And to its credit, it has been stingy with incentives on the new trucks.

But by the simplest of measures, GM's pickups had a tough year: Sales of FCA's Ram pickups rose 7% in 2018, while Ford's market-leading F-Series gained 1.4%.

Sedans
More and more buyers are choosing crossover SUVs over sedans. That's good news for GM's crossovers -- but it's not so good for the company's sedans. Most of GM's sedan models were overhauled in the last few years, and most of them are very competitive with the best global rivals -- but most saw sales plummet in 2018.

GM has responded by announcing the closure of several North American factories that make sedans: A number of formerly big-selling models, including the Chevrolet Cruze and Impala, and a few critical favorites like the superb Cadillac CT6, will be going away after 2019 -- as GM, like many rivals, focuses on higher-profit SUV and truck models.

The upshot: GM is choosing profit over sales right now
GM is willing to give up on slumping sedan models because it wants to maximize its profit margins -- not only on general principles, but because it's investing heavily in a new generation of battery-electric vehicles that will begin rolling out in a few years.

In 2018, GM reported strong full-year earnings per share-diluted-adjusted. Results were driven by strong pricing, surging crossover sales, successful execution of the company’s full-size truck launch, growth of GM Financial earnings and disciplined cost control. Full year automotive adjusted free cash flow of $3.8 billion includes the impact of $600 million in pre-funding payments to certain non-U.S. pensions.

In the first quarter, GM introduced the first production ready autonomous vehicle built for operating safely with no driver or manual controls. Cruise’s integrated approach to software and hardware development attracted $5 billion in external capital during the year. In the second quarter, GM announced a plan to place GM Korea on a path toward enterprise-level proftability. In November, the company announced steps to align its product portfolio and capacity in North America with changed consumer preferences and transform its workforce to position the company for long-term success. To date, nearly 950 hourly employees have been placed into U.S. plants with products in key growth segments.

Since 2015, the share of U.S. industry sales of crossovers and trucks has risen 12 percentage points and in China by 7 percentage points. To capitalize on these trends, GM has revamped its crossover lineup and is launching all-new full-size pickups that will be followed by full size SUVs early next year. In the U.S., GM delivered nearly 3 million vehicles, helped by crossover sales that topped 1 million for the year. Average transaction prices were a record of nearly $36,000, while incentives as a percent of ATPs fell 0.3 percent year over year. Combined sales of the Chevrolet Silverado and Colorado, and the GMC Sierra and Canyon, rose 3 percent versus 2017. In the midst of a softening market in China, GM delivered 3.65 million vehicles. Cadillac deliveries in China surpassed 200,000 units, rising 17.2 percent for the year, while the brand’s global sales increased 7.2 percent. Through Dec. 31, 2018, the company sold 8.4 million vehicles globally. For details on GM’s global sales.

In January, GM announced that Cadillac will lead the company to an all-electric future, revealing the brand’s plan for its frst fully electric vehicle. Following the success of the XT4 compact luxury SUV, Cadillac revealed the all-new three-row XT6 crossover. The brand also hinted at a future Escalade and upcoming performance sedan. To continue this product momentum, Cadillac will launch a new model every six months through 2021.