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GM profit dips on truck changeover, but beats estimates

DETROIT — General Motors on Thursday reported a higher-than-expected quarterly profit despite a drop in production of high-margin pickup trucks, as it gears up for new models that are expected to boost profits next year. Like rivals Ford and Fiat Chrysler Automobiles, GM is banking on highly-profitable Chevy Silverado and GMC Sierra pickup trucks to lift profits, as consumers shift away from traditional passenger cars in favor of these larger, more comfortable trucks, SUVs and crossovers. During the first quarter, the process of changing over to GM's new pickups resulted in a drop in production of 47,000 units. GM Chief Financial Officer Chuck Stevens said the production drop had resulted in a drop in pre-tax profit of up to $800 million. Earlier this year, GM said its 2018 profits would be flat compared with 2017, but expected its all-new pickup trucks would boost margins starting in 2019. On Thursday, GM reiterated its full-year 2018 forecast for adjusted earnings in a range from $6.30 to $6.60 per share. The automaker said capital expenditures were more than $500 million higher in the quarter because of investments its new pickup trucks and a family of low-cost vehicles under development with Chinese partner SAIC Motor Corp. On Wednesday, rival Ford said it would stop investing in most traditional passenger sedans in North America. CFO Stevens told reporters on Thursday that GM has "already indicated that we will make significantly lower investments on a go-forward basis" in sedans. 2019 GMC Sierra View 21 Photos GM benefited from a lower effective tax rate in the quarter, but adjusted pre-tax margin fell to 7.2 percent from 9.5 percent a year earlier. Stevens said the company's profit margin should hit 10 percent or higher in the second quarter and for the full year. GM said material costs were $700 million higher in the first quarter, and it expects those costs to continue rising. The automaker said it would counter those increases with cost cutting measures. "It is a more difficult environment than it was three or four months ago," Stevens said when asked about rising commodity prices from potential steel and aluminum tariffs announced by the Trump administration. "But we are confident we can continue to offset that." The company reported quarterly net income of $1.05 billion or $1.43 per share, a drop of nearly 60 percent from $2.61 billion or $1.75 per share a year earlier. Analysts had on average expected earnings per share of $1.24.

GM execs fired over fraudulent India emissions testing

General Motors hadn't had a recall in India since 1995. That changed when it was discovered that certain employees were playing tricks with local emissions testing in order to ensure passing grades for engines. More than ten GM Powertrain employees in India and the US have been let go over the ensuing emissions flap, including Sam Winegarden, VP of global engine engineering, a man who has been with the company since 1969, leading development of some marquee powerplants.
According to Automotive News, an internal investigation revealed that employees "violated testing procedures," sometimes swapping specially prepared low-emissions engines during testing regimes for the Chevrolet Tavera SUV equipped with the 2.0-liter and 2.5-liter engines. Employees were also manipulating weights in order to get vehicles placed into different emissions categories. The discovery has led to GM recall the 114,000 Taveras produced over an eight-year period and halting their production and sale.
The Economic Times of India reports that the issue is due to "a faulty component." GM has developed a solution to the issue, and once it is validated in testing and approved by the Indian authorities, the recalled vehicles will be fixed at dealers and production will resume.

Camaro-based Trans Am SE Bandit Edition borrows Burt Reynolds

For some reason, modifying modern Chevrolet Camaros into the lurching, reincarnated shells of the Pontiac brand is still a thing. If you're the perverse sort that likes this kind of thing, you should check out the latest product from the Trans Am Depot, which comes complete with an endorsement from the star of Smokey and the Bandit, Burt Reynolds. Yes, the new Trans Am SE Bandit Edition has been signed and endorsed by the man himself, but what's important here is not the signature on the dash, it's the bits of Camaro that have been modified. Aesthetically, that means a Bandit-and-Frog-approved set of T-tops, a front-opening hood with a very large, prominent shaker scoop, an equally large and prominent screaming chicken, and Trans Am-inspired front and rear fascias. And naturally, Burt Reynolds' signature adorns the dash. There are plenty of reminders in the cabin about this car's Hollywood inspiration, too. Bandit decals can be found on the front headrests and center console lid, there are chicken wings on the Camaro-spec plastic door inserts, and the black-and-tan color scheme matches nicely with the exterior look. And power? Well, Sheriff Buford T. Justice would have a lot more trouble keeping up with this Trans Am than he did with the original. The 7.4-liter LSX V8 has been paired with a 2.9-liter supercharger which is good for 840 horsepower. It's fast and loud, and even if you can't get behind the look (we can't), at least this Camaro-in-Trans Am's clothing can impress with its performance. The Bandit Edition is limited to just 77 units with prices starting around $115,000. You can check out the official video from Trans Am Depot, which comes with a decent helping of Burt Reynolds, up top. Related Video: