01—Abstract
Summary
Summary of the 10-K filed February 5, 2020. Cited figures are marked; the original filing is the authoritative source.
General Motors Company (GM) reported its 2019 annual results, highlighting a challenging year impacted by a significant UAW strike that disrupted production and sales, resulting in an estimated $3.6 billiona unfavorable pre-tax impact.
Despite this, the company is strategically transforming, with significant investments in electrification and autonomous vehicle technology. GMNA sales decreased, partly due to the strike, while GMI faced headwinds from lower industry volumes, particularly in China. The company ended the year with solid liquidity and an investment-grade credit rating, indicating a resilient financial position despite operational disruptions.
GM is actively repositioning for the future of mobility, emphasizing its commitment to an all-electric future and ongoing development of autonomous driving capabilities through its Cruise segment. These strategic investments are coupled with ongoing cost-saving initiatives, including a transformation plan aimed at delivering substantial annual cash savings. Investors should monitor the pace of EV adoption, progress in autonomous technology commercialization, and the company's ability to navigate global economic and regulatory landscapes.
02—Key points
Key Highlights
- GM experienced an estimated $3.6 billion unfavorable pre-tax impact in 2019 due to a UAW strike that caused significant production and sales disruptions.
- The company is heavily investing in future mobility, including electrification (Battery Electric Vehicles) and autonomous vehicle technology (Cruise segment).
- GMNA (North America) sales declined, reflecting industry trends and strike impacts, with market share slightly down. GMI (International) also saw revenue decreases, with China being a key market facing headwinds.
- GM Financial reported revenue growth and improved adjusted earnings before taxes, indicating a healthy performance from its financing arm.
- The company maintained a strong liquidity position with $37.2 billion in total available liquidity at year-end 2019.
- GM is undergoing a strategic transformation aimed at significant cost savings by the end of 2020, projecting $5.5 billion to $6.0 billion in annual cash savings from its 2018 transformation plans.
- GM maintained an investment-grade credit rating from major agencies, demonstrating financial stability despite operational challenges.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2019, General Motors Co kept $0.05.
- Revenue$137.24B100.0%
- Cost of revenue−$110.65B80.6%
- Gross profit$26.59B19.4%
- Operating costs−$21.11B15.4%
- Operating income$5.48B4.0%
- Interest, other & tax$1.19B0.9%
- Net income$6.67B4.9%
Where FY2019 revenue went
$137.24B- Cost of revenue: $110.65B, 81% of revenue
- Operating income: $5.48B, 4.0% of revenue
- SG&A: $8.49B, 6.2% of revenue
- Other operating costs: $12.61B, 9.2% of revenue
Kept 4.0% as operating incomeOperating income $5.48B · 4.0%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2019filed February 5, 2020Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $137.24B$147.05B | −6.7% |
| Cost of Revenue | $110.65B$120.66B | −8.3% |
| Gross Profit | $26.59B$26.39B | +0.7% |
| SG&A Expenses | $8.49B$9.65B | −12.0% |
| Operating Expenses | $131.76B$142.60B | −7.6% |
| Operating Income | $5.48B$4.45B | +23.3% |
| Interest Expense | $4.42B$3.88B | +14.0% |
| Net Income | $6.67B$8.01B | −16.8% |
| EPS (Basic) | $4.62$5.61 | −17.6% |
| EPS (Diluted) | $4.57$5.53 | −17.4% |
| Shares Outstanding (Basic) | 1.42B1.41B | +0.9% |
| Shares Outstanding (Diluted) | 1.44B1.43B | +0.6% |
05—Questions
Frequently Asked Questions
What was the financial impact of the UAW strike in 2019?
The UAW strike in 2019 had a significant negative pre-tax impact on GM, estimated at approximately $3.6 billion on its Income from continuing operations and $5.4 billion on Net cash provided by operating activities.
What is GM's strategy regarding electric and autonomous vehicles?
GM is committed to an all-electric future and is investing heavily in battery electric vehicles (BEVs) and autonomous vehicle technology. The company is developing a flexible electric vehicle architecture and is retooling its Detroit-Hamtramck Assembly plant for dedicated EV production. Its Cruise segment is a leader in autonomous vehicle technology development and testing.
How did GM's major geographical segments perform in 2019?
GM North America (GMNA) saw a decrease in total net sales and revenue primarily due to lost production from the UAW strike and lower vehicle volumes. GM International (GMI) also experienced a decline in revenue, driven by lower industry volumes in key markets like China and Argentina. Equity income from its China joint ventures was also down.
What is the outlook for GM Financial?
GM Financial reported an increase in revenue and adjusted earnings before taxes (EBT-adjusted) in 2019, driven by growth in its retail and commercial finance portfolios and improved leased vehicle income. The outlook appears positive, although it notes increased used vehicle supply is expected to impact residual values.
06—Continue