General Motors (GM) reported a loss for the fourth quarter, primarily due to a challenging market environment in China. Despite this, the company still exceeded Wall Street’s expectations for profit and revenue. GM is taking steps to engage with the U.S. government on regulations and has also announced substantial profit-sharing bonuses for its employees.
Earlier in the month, GM warned that its poor performance in China, where it has joint ventures, would lead to a write-down of assets and a restructuring charge of over $5 billion for the fourth quarter. The Chinese market has become tougher for foreign automakers like GM, as domestic companies such as BYD are improving vehicle quality and cutting costs, supported by government subsidies.
For the quarter ending December 31, GM posted a loss of $2.96 billion, or $1.64 per share, compared to a profit of $2.1 billion, or $1.59 per share, the previous year.
Excluding charges and other special items, GM reported earnings of $1.92 per share for the quarter, surpassing the $1.85 per share that analysts had expected.
The company’s revenue also increased, rising to $47.7 billion from $42.98 billion, which was above Wall Street’s forecast of $44.98 billion.
In a letter to shareholders, CEO Mary Barra highlighted that GM doubled its market share of electric vehicles in 2024 as it ramped up production. She also mentioned that, despite restructuring costs, GM saw positive equity income from its operations in China during the fourth quarter and is working with its partner to make further improvements.
In the U.S., Barra shared that GM’s hourly employees earned the highest profit-sharing bonuses in the industry, totaling over $640 million. Each worker will receive up to $14,500, which Barra pointed out is equivalent to more than two months’ worth of extra pay for employees represented by the United Auto Workers.
Barra also acknowledged the uncertainty surrounding trade, tax, and environmental regulations in the U.S., but emphasized that GM has been proactive in working with Congress and the Trump administration to address these issues.
In her remarks, Mary Barra emphasized the importance of a strong manufacturing sector and U.S. leadership in advanced technologies during discussions with the Trump administration. She noted that GM and the government share common ground and appreciated the ongoing dialogue.
While President Trump has made lowering gasoline prices a key part of his plan to address inflation, tariffs on Canada could drive up gas prices unless exemptions are made. Trump is also considering tariffs on Mexico and new taxes on China and other countries, which could negatively affect companies in the transportation and automotive industries, many of which operate in Canada and Mexico.
However, Barra expressed confidence that the situation would be resolved. She stated that GM believes the President wants to use policy and regulations to strengthen, not harm, U.S. manufacturers like GM. She also expressed optimism about continuing to work with the President and his team to find the right balance on these issues.
On the topic of tariffs, Barra mentioned that GM is actively working across its supply chain and assembly plants to prepare for and mitigate any short-term impacts.
During a conference call, Mary Barra explained that many of GM’s actions are either low-cost or no-cost initiatives. She emphasized that the company won’t commit significant capital without clear direction.
Barra also pointed out that no matter what happens in the U.S., GM has a diverse and expanding portfolio of both internal combustion engine (ICE) vehicles and electric vehicles (EVs) that are gaining market share. The company plans to remain flexible and efficient in executing its strategies.
Dan Ives of Wedbush noted in a report that GM ended 2024 on a strong note and continues to benefit from its investments. He believes GM is making significant progress in navigating the challenging EV market and balancing production with profitability, setting the company up for sustainable growth in the coming years.
Looking ahead, GM will introduce three new Cadillac electric vehicles in 2025: the Escalade IQ, Optiq, and Vistiq. Barra also mentioned that the company will feel the full impact of the new gas-powered SUVs launched in 2024, including the Chevrolet Equinox, Chevrolet Traverse, and GMC Acadia.
For 2025, GM is forecasting adjusted earnings in the range of $11 to $12 per share, surpassing the $10.86 per share analysts had projected. However, GM’s shares fell more than 11% on Tuesday.