General Motors said Wednesday it expects first half profits to be much better than earlier forecast, in part due to the success shifting scarce semiconductors to increase production of highly profitable trucks in North America.
The automaker informed investors in early May it expected first half earnings before interest and taxes to be around $5.5 billion, factoring out one-time gains and charges. For the entire year, the automaker said it expected pretax profits “at the higher end” of a $10 billion to $11 billion range.
The automaker reported $4.4 billion in operating profit for the first quarter. The new guidance indicates second quarter pretax profits will surpass $1.1 billion.
The automaker did not provide the exact second quarter or full year forecast. It only said that it was optimistic about hitting the full-year target.
The increased profit guidance, and moves announced Wednesday to increase shipments of pickup trucks, indicate that the automaker is achieving greater stability in getting chips and allocating them among its model lines, after months of scrambling to cope with supply chain disruptions.
GM said Wednesday it expects to increase production of its heavy duty Chevrolet Silverado and GMC Sierra pickups by 1,000 vehicles monthly, a result of efficiency gains engineered by employees at the Flint, Michigan factory that builds the vehicles. Heavy duty Silverado and Sierra trucks start at around $40,000.
The automaker also expect shipments of mid-size Chevrolet Colorado and GMC Canyon pickups will increase by 30,000 vehicles during a period that start in mid-May through July 5.
The automaker said production at other plants in North America, Asia and South America will be curtailed through June and July. During the second half, the automaker said it expects semiconductor supplies to make a recovery which will allow increased production and delivery of vehicles.
