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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.

Disabled man realizes dream of driving with converted pickup truck

A man with a devastating illness is mobile once again thanks to a heavily modified pick up truck. He hopes he can help others in his situation gain the freedom of mobility they need to lead a normal life. Chris Sauerbaum has a physical disability resulting from chronic inflammatory polyneuropathy, a form of muscular dystrophy where the sufferer's immune system attacks their nerves. Sauerbaum lost both of his legs and is bound to a wheelchair. After 11 years of trying, he finally has a vehicle that he can drive. "You might as well be driving a Lamborghini," Sauerbaum told the York Dispatch as the driver side door extended to a lift to accommodate Sauerbaum's wheelchair. "Everyone comes up and talks to you. You come out looking like a Transformer." It wasn't easy getting transportation that fit his needs. First he bought a Chrysler PT Cruiser, which wasn't large enough to handle the equipment needed to convert the car for a legless driver. In 2013, Sauerbaum and his wife Heather Sloat appealed to local businesses and friends for donations. They raised $10,000 and were able to put a downpayment on a GMC Sierra. The truck then underwent $91,000 worth of upgrades. It was completely outfitted for Sauerbaum, with a large lift to bring his wheel chair up to the driver's seat and joysticks doing the work of peddles and the steering wheel. New York's Office of Vocational Rehabilitation paid for the conversion. "Think of it as a big remote controlled car. An 8,000 pound R/C car," Sauerbaum told the Dispatch. After a week and a half of learning the controls, Sauerbaum was able to drive with confidence again. He will no long need to rely on his wife to get him two and from work, an 80-mile trip each day. Sauerbaum and Sloat hope to start a nonprofit called Drive for Independence that will assist other wheelchair-bound people with the costs of getting a converted vehicle that suits their needs. "It's just one piece of the puzzle to get people to work," Sloat told the Dispatch. Related Video: Weird Car News GMC Driving Ownership Truck Videos disabled ms

GMC to get own model not shared with Chevy?

For years, GMC has existed as a brand without a single unique product, reconstituting Chevrolet trucks, SUVs and crossovers with more frosting in exchange for a few extra dollars. The Sierra is a Silverado, the Acadia a Traverse, and the Terrain an Equinox, although admittedly the latter pair are visually differentiated to a significant degree.
GMC could be set to expand beyond its Chevy-based roots, though. During last week's Detroit Auto Show press days, GM's product boss Mark Reuss was asked whether there'd ever be a GMC that wasn't taken from Chevy. "Oh, yes, you will," Reuss told the media. "The health of GMC is astonishingly good from a consideration standpoint." Reuss wouldn't elaborate on what the model could be, although we're quite happy to make some guesses. GMC has its bases fairly well covered, with a mid-size and full-size crossover, as well as a mid-size, full-size and HD pickup. We doubt GMC will be building a family sedan, sports car, or hatchback, so really, the only place we can see the brand going is into a smaller crossover.
Automotive News points out that the most recent small GMC showcar, the 2010 Granite concept (shown above), won't see production according to General Motors. That vehicle likely would have rode on GM's compact vehicle architecture, known internally as Gamma II, which underpins the Chevy Spark and Sonic, as well as the Buick Encore (and its overseas Opel/Vauxhall/Chevy counterparts).