General Motors has announced a $6 billion share repurchase, adding to its momentum in 2024. This follows a $10 billion share buyback authorization from last year. The Detroit automaker's shares rose 1.4% to $48.21 on Tuesday. GM's shares have seen a 34% increase since the beginning of the year.
In addition to the share repurchase, GM has raised its dividend to 12 cents per share from 9 cents per share. The company also disclosed an $850 million investment in its Cruise autonomous vehicle unit to support operational cash needs until a long-term capital strategy is established.
Cruise, which faced challenges after an incident involving one of its autonomous vehicles in San Francisco, has been working on regaining regulatory approval. The company's license to operate its driverless fleet in California was suspended following the incident.
At a recent conference, GM's Chief Financial Officer mentioned a revised electric vehicle production forecast of 200,000 to 250,000 units for the year, down from the previous estimate of 200,000 to 300,000. The company is adapting to market trends, with electric vehicle sales in the U.S. currently trending at around 8% instead of the expected 10%.
General Motors has shown a strong performance this year, rebounding from a share price low of $26. The company reported a first-quarter profit of $2.97 billion, up 25% from the same period last year. GM's focus on profitability and expense management has been key to its success, surpassing Wall Street's expectations and raising its guidance for 2024.
Meanwhile, other U.S. automakers are facing challenges. Ford's shares have seen minimal growth, and its first-quarter net income dropped by 24% year-over-year. Stellantis reported a sales decline in the first quarter, with shares down nearly 7% for the year. Tesla, led by Elon Musk, experienced a significant sales decline in the first quarter, marking the first year-over-year quarterly drop in nearly four years. Despite offering price cuts, Tesla shares have declined by almost a third in 2024.
