GM is increasing its quarterly dividend by 33% and initiating a $10 billion share repurchase program.
GM's new labor deals will cost it $9.3 billion, translating to about $575 per vehicle over the life of the deals.
The company is also reinstating its 2023 guidance after a year of labor strikes and setbacks in its plans for electric and autonomous vehicles.
General Motors (GM) has announced several investor-focused initiatives, including a 33% increase in its quarterly dividend to 12 cents per share, an accelerated $10 billion share repurchase program, and the reinstatement of its 2023 guidance. This comes after a year of labor strikes and setbacks in its plans for electric and autonomous vehicles. GM's CEO, Mary Barra, stated that the company is finalizing a budget for next year that will fully offset the incremental costs of new labor agreements.
Despite high interest rates threatening car sales and capital burdens from its electric-vehicle effort, GM is trying to prove to shareholders that it can generate significant cash while still investing in technology. The company will advance $10.0 billion to the executing banks and will immediately receive and retire $6.8 billion worth of GM's common stock. The $10B buyback represents approximately 25% of the total market cap of $39B.
However, GM's new labor deals, following a lengthy U.S. strike, will cost it $9.3 billion. The additional costs through 2028 are for agreements with the UAW and Canadian union Unifor, translating to about $575 per vehicle over the life of the deals. GM's new guidance reduced expected net income attributable to stockholders for 2023 to a range of $9.1 billion to $9.7 billion, compared to the previous outlook of $9.3 billion to $10.7 billion.
GM's CEO, Mary Barra, stated that the company is finalizing a budget for next year that will fully offset the incremental costs of new labor agreements.
Despite high interest rates threatening car sales and capital burdens from its electric-vehicle effort, GM is trying to prove to shareholders that it can generate significant cash while still investing in technology.
The additional costs through 2028 are for agreements with the UAW and Canadian union Unifor, translating to about $575 per vehicle over the life of the deals.
GM's new guidance reduced expected net income attributable to stockholders for 2023 to a range of $9.1 billion to $9.7 billion, compared to the previous outlook of $9.3 billion to $10.7 billion.