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AP DETROIT prices of used cars are down, the U S sales are slow start, Auto stocks are growing and interest rates are rising again, General Motors is sticking to its earnings forecasts.
Chuck Stevens, chief financial officer of GM, told Thursday industry analysts that the company is optimistic for several reasons the sale of its European unit save GM money, he predicts US sales will rebound later in the year, and provides new SUVs to seek higher prices.
In January, the Detroit automaker predicted profit before tax for the year from June to June 50 per share, against June 12 he did in 2016.
Last month GM unloaded its brands Opel and Vauxhall European French automaker PSA Group for about 2 33 billion February 2 billion, reversing the third largest car market after nearly two decades of futile efforts to make the world money.
Stevens said the sale, expected to close by the end of this year, cutting 400 million loss, and also frees 1 billion in capital spending that was heading to European centered products GM also avoids future costs to comply with regulations strict European environmental, Stevens.
Although the US auto market slowed in the first quarter, GM expects sales to recover and end of 2017 to approximately 17 5 million, close to last year's record of 17 55 million, the CFO said Stevens acknowledged that incentives such as loans at low interest rates and rebates are rising, but also said that average selling prices for GM vehicles also increases.
Inventories increased to end the offer 90 days of cars and trucks Mars This should fall to a 70-day supply by the end of the year, Stevens said With thousands of new cars coming out of leases, GM will manage the supply by selling them as certified pre-owned vehicles and may even try to work with companies deals carpooling Lyft and Uber, he said.
GM oldest crossover SUV portfolio in the industry, making it necessary to exclude the vehicles, Stevens said, but that will change this year with the launch of the new Chevrolet Equinox SUV and larger as the GMC Acadia, Chevrolet Traverse and Cadillac XT5.
As we come out of this transition to the new portfolio, we will see a recovery in transaction prices with incentive spending unless we launch new products, Stevens told a conference call.
The company will also close truck plants in the third quarter to prepare the launch of a new pickup truck full in 2018, Stevens said.
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