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General Motors increases investment in electric car production in Brazil
The American company General Motors has announced investments in the production of electric cars in Brazil. The company plans to invest USD 1.4 billion over 5 years in producing environmentally friendly transport. This step will allow GM to accelerate the production of electric cars in the country.
It is worth noting that Brazil remains a country where the development of electric transport is prolonged. Unlike other countries, there are no initiatives to promote battery-powered cars. On the other hand, the American manufacturer was the first of the traditional car manufacturers to decide to invest in electric vehicles. The impetus for this was new government regulations. At the end of 2023, local authorities published improved principles for the activities of the automotive sector. Following GM’s announcement, experts expect other major companies to announce plans to expand electric car production.
Fabio Rua, who represents GM in Brazil, said the company’s investments aim for sustainable development. The manufacturer wants to change local attitudes towards environmentally friendly technologies. The company believes its commitment to fossil-fuelled cars has left the country far behind regarding climate change. However, Brazil is well positioned to become one of the world’s top three markets for electric vehicles.
The financial success of the company
General Motors is implementing a large-scale development strategy that has yielded excellent results. The company completed the year 2023, generating revenues that exceeded analysts’ forecasts. Experts believe that the company will maintain a good pace in the current period despite possible difficulties in the global economy.
According to the forecast, the company will reach the next level in 2024:
- net income will be in the range of USD 9.8 billion to USD 11.2 billion;
- earnings per share in the range of USD 8.5 to 9.5;
- income from operations, including interest and taxes of USD 12 to 14 billion;
- adjusted cash flow guidance of USD 8-10 billion.
These forecasts exceed the company’s guidance for 2023, indicating a high level of confidence among experts. General Motors increased revenues by 10% to more than USD 171.8 billion in the previous period. In the 4th quarter of 2023, net income totalled USD 2.1 billion.
At the same time, the company continues to face several difficulties. First and foremost is the slowing momentum in the company’s key markets. In the fourth quarter of 2023, profits in North America were 45% lower than in 2022. China is the second largest market in terms of sales, and there was also a decline. Annual revenue fell by 45% to USD 446 million, a drop of 54% in Q4.