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On October 22, one of America's largest automakers, Detroit Big Three mainstay General Motors ( GM ) , reported better-than-expected earnings that surprised many keen Street observers. The company reported that during the third quarter of 2024, its adjusted earnings before interest and taxes rose 15.5% to $4.
1 billion, while its revenue jumped 10.5% to $48.757 billion.
It attributed this to well-managed inventories, controlled incentive spending, and the strength of its EV and internal combustion engine catalog. 💰💸 Don’t miss the move: SIGN UP for TheStreet’s FREE Daily newsletter 💰💸 "We have been able to grow our retail market share in the U.S.
with above-average pricing, well-managed inventories and below-average incentives," CEO Mary Barra told analysts on the company's third-quarter earnings call. "I want to be clear, though, we are not mistaking progress for winning. The competition is fierce, and the regulatory environment will keep getting tougher.
That's why we're focused on optimizing our ICE and EV margins." Chevrolet GM's profit drivers hit a rough patch Though the company raised its year-end pre-tax adjusted income from a range of $13 billion to $15 billion, to $14 billion to $15 billion, a new threat might put a speed bump in General Motors' path. Cadillac According to documents from the National Highway Traffic Safety Administration (NHTSA), the Detroit automaker has been under the microscope of two massive but separate recalls within the past two consecutive days.
On November 13th, the automaker issued a recall affecting 461,839 of its popular diesel-powered pickup trucks and full-size SUVs due to a defect that can cause the transmission control valve to fail and lock up the rear wheels, which can dramatically increase the risk of a crash. The list of vehicles impacted by the recall includes some of the automaker's most popular and profitable pickup trucks and SUVs across its brands. These include the 2020-2022 model years of the 1500, 2500, and 3500 models of the Chevrolet Silverado and GMC Sierra pickup trucks, as well as the 2021 Chevrolet Tahoe and Suburban, GMC Yukon and Yukon XL, and Cadillac Escalade and Escalade ESV SUVs.
Amazon/TheStreet As per GM, drivers of affected vehicles will experience harsh shifting before any wheel problems. “A transmission control valve in some of these vehicles may be susceptible to excess wear over time, resulting in a gradual loss of pressure within the valve that can cause harsh shifting. In rare cases, the rear wheels may experience a momentary lockup,” NHTSA documents say.
GM and the NHTSA say that the recall does not affect gas-powered versions of these vehicles, as diesel-engined versions use a different transmission. Affected vehicle owners can expect to see recall notices in their mailboxes around December 9, 2024. Affected owners are asked to contact their local GM dealerships, where new transmission control module software that will detect excess wear and prevent the wheels from locking up will be installed free of charge.
More Automotive: GM's transmission double-whammy General Motors' troubles are not limited to its passenger vehicles. In NHTSA documents released on November 14, General Motors issued a recall of 77,824 units of the 2022-2023 model year Chevrolet Express van and its sibling, the GMC Savana. Chevrolet According to the NHTSA, the recall specifically affects vans with very specific engine and gearbox combinations, particularly Express and Savana vans equipped with 4.
3L V6 engines and 8-speed automatics or the 4-cylinder motor with an 8-speed automatic. The agency says that these vans have transmission control module software that is "incorrectly calibrated," which can increase the risk of a crash. According to the NHTSA, incorrectly calibrated software can cause "harsh shifting or reduced power, [.
..] unintended deceleration or rear wheel lockup," as well as cause vehicles to "move in an unintended direction" in certain low-speed situations.
Related: Hyundai and General Motors join forces to revolutionize future cars Though the recall affects specific Chevrolet Express and GMC Savana vans and are not intended as passenger vehicles for most buyers, most Americans encounter them daily. They are often the choice of vans for small businesses and services like plumbers and contractors or even as hire vehicles provided by companies like U-Haul. GM says dealers were notified about the recall on November 7 and owners will be notified by mail starting December 23, 2024.
Dealers will be tasked with updating the transmission control module software, which is covered under warranty. General Motors, which trades under GM on the New York Stock Exchange is down 0.08%, trading at $57.
67 at the time of writing. Related: Veteran fund manager sees world of pain coming for stocks.
