General Motors' Chief Financial Officer, Paul Jacobson, announced during an investor day event that the company anticipates its adjusted earnings in 2025 to be similar to the current year's results. GM's adjusted earnings before interest and taxes (EBIT) target for 2024 is set between $13 billion and $15 billion, translating to $9.50 to $10.50 per share. This is an increase from the previous estimate of $12.5 billion to $14.5 billion, or $9 to $10 per share.
Meeting the 2024 target and achieving similar earnings in 2025 would be a significant accomplishment, especially given the slowing sales in the automotive sector and reduced consumer spending. Many on Wall Street predict a more challenging year for automakers in 2025. However, Jacobson refrained from providing detailed financial targets for 2025 before the company's official guidance release early next year.
The CFO anticipates increased profitability from GM's electric vehicle (EV) segment, with earnings expected to rise by $2 billion to $4 billion. Sales and profits from traditional gasoline-powered vehicles are also predicted to grow, further boosting overall profitability. Jacobson noted that, based on current assumptions, GM plans to launch eight new models with an EBIT margin approximately 9 percentage points higher than previous models.
Capital expenditure for GM in 2025 is expected to remain consistent with this year's levels. For 2024, the company's financial guidance includes projected capital expenditures ranging from $10.5 billion to $11.5 billion.
GM CEO Mary Barra stated that the company plans to produce and wholesale around 200,000 electric vehicles in North America in 2024, aiming to achieve profitability based on production and contribution margins by the end of the year. This target is lower than the previous goal of 200,000 to 250,000 EVs, with an earlier target set at 300,000 units.
