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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.

2019 GMC Sierra AT4 gives Raptor and Ram a new off-road rival

The 2019 GMC Sierra AT4 blends off-road hardware into a modern, thoroughly updated pickup truck that doesn't skimp on power, luxury, or safety equipment. From its higher suspension setup to its available carbon-fiber cargo bed and the new MultiPro tailgate, the 2019 Sierra AT4 is a direct shot across the bow — or cargo beds, if you prefer — of staunch rivals like the Ford F-150, Dodge Ram and Toyota Tundra. Revealed tonight in New York City, ahead of this week's New York International Auto Show, the truck may seem to be in a strange setting. Then again, with the amount of tire-swallowing potholes currently scattered around the Big Apple, a rugged truck like the Sierra AT4 could be the perfect vehicle for either off-road excursions or an especially bumpy commute. Riding two inches higher than the standard 2019 Sierra, the AT4 comes with standard features like all-wheel-drive with a two-speed transfer case, locking rear differential, Rancho monotube shock absorbers designed specifically for off-roading, along with skid plates and 18- or 20-inch alloy wheels fitted with all-terrain tires or optional, mud-loving Goodyear Wrangler Duratecs. Hill descent control and GMC's Traction Select system are also standard. The latter of these two lets the driver choose between preset drive modes, suitable for various types of terrain and weather conditions. The system then adjusts throttle response, shift points, and the electronic stability control according to each mode. Related: 2018 GMC Sierra 1500 buying guide "The 2019 Sierra AT4 is designed for the customer who wants an elevated presence on the road and the capability to venture off life's beaten path," said Duncan Aldred, vice president of Global GMC. "It's also the beginning for the AT4 brand, which will be seen on every vehicle in our lineup in the next two years." Based on the new 2019 Chevrolet Silverado, the GMC Sierra (including the AT4 model) looks to stand out from its corporate cousin in terms luxury touches, along with some subtle exterior details. For the AT4, these visible differences include a body color grill surround and bumpers. Meanwhile, the inner grille, front fog-lights and faux fender vents feature a black-chrome finish. It's not flashy, which is probably exactly what GMC wanted for its upscale truck. The standard engine is a 5.3-liter V8, though buyers can choose an optional 3.0-liter turbo-diesel inline-six or 6.2-liter V8.

GM able to add diesel to half-ton pickups if market demands it

A few years ago, the trend in half-ton pickup trucks was ultra-luxurious trims, often with the words "limited" or "platinum" tacked on after the model name. That was well and good, but we like this latest fad a lot more - diesel engines. First, Ram came to bat with a 3.0-liter, V6 turbodiesel for the 1500, then Nissan announced that the next-generation Titan would be getting an eight-cylinder Cummins diesel.
Now, word is coming in from AutoGuide that General Motors can, if it so chooses, drop a diesel engine into its light-duty trucks. The plot thickens, though, as it turns out that said diesel would be the same one Ram is using for its truck. According to AG, that engine comes from VM Motori, which GM owns a sizable chunk of. Therefore, GM can snag the 3.0-liter, V6 diesel for its trucks just as easily, if not more easily, than Ram.
If it's so easy for the Detroit-based manufacturer to access the engines, why not offer the a diesel-powered Sierra and Silverado from the start, then? According to GM spokesman Tom Wilkinson, The General doesn't seem so confident in a diesel pickup outside of its HD offerings. According to Wilkinson, the cost-benefit ratio doesn't line up for customers, thanks to both the impact on the truck's sticker price and the higher price of diesel, in general (the national average for a gallon of diesel is 43 cents more than a gallon of 87-octane unleaded).