General Motors released third-quarter earnings Wednesday that beat analysts expectations on strong truck sales. Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $1.87, adjusted, vs. $1.25 expected
- Revenue: $35.79 billion vs. $34.85 billion expected
All of the automakers have been reporting higher material costs and other increased expenses stemming from the trade war, particularly between the United States and China.
That’s been punctuated by signs of weak demand for new cars overall, particularly in North America. A recent estimate from industry tracker LMC Automotive said North American new vehicle sales are expected to fall in October over the same month last year and face further pressure ahead.
“Affordability may be the canary in the coal mine for the level of auto sales as we close out 2018 and begin to look at 2019. Transaction prices are still edging higher,” said Jeff Schuster, president, Americas operations and global vehicle forecasts at LMC Automotive.
The Federal Reserve is expected to raise interest rates again in December, followed by three more rate hikes in 2019, he said. Drivers are buying more used cars, in the meantime.
“This is a combination that could cause consumers to be squeezed out of the new-vehicle market, putting pressure on volume even if other fundamentals are favorable,” Schuster said.
GM’s shares have fallen nearly 19 percent since the beginning of the year.
