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General Motors posts record earnings, but global sales fall

General Motors started the year with record success. The automaker's $2.7 billion in adjusted earnings before interest and taxes was its highest ever in in the first quarter of 2016, up from $2.1 billion in from the same time period a year earlier. Net income grew to $1.95 billion, which was more than double the $953 million in the same period last year. The company's figures also beat analysts' predictions, according to the Detroit Free Press. Despite the financial growth, global sales actually decreased by 2.5 percent to 2.36 million vehicles. "We're growing where it counts, gaining retail share in the US, outpacing the industry in Europe and capitalizing on robust growth in SUV and luxury segments in China," CEO Mary Barra said in the company's financial announcement. GM did well in North America with an adjusted EBIT of $2.3 billion, up from $2.2 billion last year. Sales in the region also grew 1.2 percent to 800,000 vehicles. According to The Detroit Free Press, the company has been especially successful at selling more expensive models in the US. The company's average vehicle was $34,600 in Q1, about $3,000 more than the industry average. Elsewhere in the world, GM also showed improvement. Europe practically broke even after losing about $200 million last year, and Opel and Vauxhall sales grew 8.4 percent to more than 300,000 vehicles for the quarter. South America only lost $100 million, which was half as much as Q1 2015's $200 million loss. China remained flat at $500 million of income. Cadillac volume jumped 6.1 percent there, and Buick's deliveries increased 22 percent, thanks to the Envision crossover's success. GM Reports First-Quarter Net Income of $2.0 Billion 2016-04-21 EPS diluted of $1.24; First-quarter record EPS diluted-adjusted of $1.26 First-quarter record EBIT-adjusted of $2.7 billion GM Europe posts break-even performance DETROIT – General Motors Co. (NYSE: GM) today announced first-quarter net income to common stockholders of $2.0 billion or $1.24 per diluted share, compared to $0.9 billion or $0.56 per diluted share a year ago. Earnings per share diluted-adjusted for special items was a first-quarter record at $1.26, up 47 percent compared to the first quarter of 2015. The company set first-quarter records for earnings and margin, with earnings before interest and tax (EBIT) adjusted of $2.7 billion and EBIT-adjusted margin of 7.1 percent.

Frustrated GM investors ask what more Mary Barra can do

DETROIT — General Motors Co Chief Executive Mary Barra has transformed the No. 1 U.S. automaker in her almost five years in charge, but that is still not enough to satisfy investors. Ahead of third-quarter results due on Oct. 31, GM shares are trading about 6 percent below the $33 per share price at which they launched in 2010 in a post-bankruptcy initial public offering. The Detroit carmaker's stock is down 22 percent since Barra took over in January 2014. After hitting an all-time high of $46.48 on Oct. 24, 2017, the shares have declined 33 percent. In the same period, the Standard & Poor's 500 index has climbed 7.8 percent. Several shareholders contacted by Reuters said GM could face a third major action by activist shareholders in less than four years if the share price does not improve. "I've been expecting it," said John Levin, chairman of Levin Capital Strategies. "It just seems a tempting morsel to somebody." Levin's firm owns more than seven million GM shares. Barra has guided the company through the settlement of a federal criminal probe of a mishandled safety recall, sold off money-losing European operations, and returned $25 billion to shareholders through dividends and stock buybacks from 2012 through 2017. GM declined to comment for this story, but the company's executives privately express frustration with the market's reluctance to see it as anything more than a manufacturer tied mainly to auto market sales cycles. GM's profitable North American truck and SUV business and its money-making China operations are valued at just $14 billion, excluding the value of GM's stake in its $14.6 billion Cruise automated vehicle business and its cash reserves from its $44 billion market capitalization. The recent slump in the Chinese market, GM's largest, and plateauing U.S. demand are ratcheting up the pressure. GM is one of the few global automakers without a founding family or a government to serve as a bulwark against corporate raiders. In 2015, a group led by investor Harry Wilson pressed GM to launch a $5 billion share buyback, and commit to what is now an $18 billion ceiling on the level of cash the company would hold. In 2017, GM fended off a call by hedge fund manager David Einhorn to split its common stock shares into two classes. Einhorn, whose firm still owned more than 21 million shares at the end of June, declined to comment about GM's stock price. Other investors said there were no clear alternatives to Barra's approach.

Junkyard Gem: 1978 Buick Skylark Sedan

Around the time that OPEC shut off the oil taps, The General realized that it was time to sell more small cars from GM divisions not previously known for such machines. The logical candidate for this project was the Chevrolet Nova, a rear-wheel-drive compact that shared much of its chassis design with the Chevrolet Camaro and Pontiac Firebird. The Nova-based Pontiac Ventura came out in the 1971 model year, and the Buick and Oldsmobile Divisions began producing their own badge-engineered Nova siblings for 1973 (Cadillac was late to the party, but eventually created the Nova-based Seville for 1976). At first, the Buickized Nova got Apollo badges, but the better-known Skylark name was applied to these cars for the 1975 through 1979 model years. Today's Junkyard Gem is one of those Nova-based Skylarks, found in a Denver self-serve yard. From the 1964 through 1972 model years, the Skylark lived on the A-Body chassis and was sibling to the Chevrolet Chevelle/Malibu, Pontiac LeMans/Tempest/GTO, and Oldsmobile Cutlass/442. After the 1975-1979 rear-wheel-drive X-Body phase, the Skylark name then went onto the unrelated front-wheel-dive X-Body chassis developed for the Chevrolet Citation. It's a Nova, sure, but Buick made sure that it had a bit more swank than its Chevy counterpart. Checked seat fabric with big square buttons! The base engine in the '78 Skylark was the 3.8-liter Buick V6, rated at 110 horsepower. GM had invested in a new crankshaft design for this engine the year before, so it no longer had the "odd-fire" cut-down V8 crankshaft that shook the fillings out of so many drivers' teeth in earlier years. An assortment of low-compression V8s from Oldsmobile, Chevrolet, Pontiac, and Buick were available as optional equipment as well, eventually leading to the "Chevymobile" lawsuits of a few years later. The base transmission in this car was a three-speed manual (I'm not sure if you could still get a three-on-the-tree column-shift manual Skylark in 1978, but a three-on-the-floor manual was available for sure). The very last three-on-the-tree car Americans could buy was the '79 Nova and its Olds Omega/Pontiac Phoenix siblings, while the final three-on-the-floor cars were the '81 Malibu and siblings. This car has the optional three-speed automatic.