Mary Barra, chairman and CEO of General Motors Company (GM), speaks during the Milken Institute Global Conference in Beverly Hills, California, on May 2, 2022.
Patrick T. Fallon | AFP | Getty Images
DETROIT – General Motors on Friday warned investors that supply chain issues will weigh heavily on its second-quarter earnings, while maintaining its previous guidance for 2022.
The Detroit automaker said it expects second-quarter net income to be between $1.6 billion and $1.9 billion and adjusted pretax profit to be in the range of $2.3 billion to $2.6 billion.
Analysts had expected GM’s net income to be about $2.5 billion in the second quarter, according to FactSet. GM did not previously provide guidance for its second quarter.
The automaker’s shares fell 2 percent after being briefly halted in premarket trading pending news.
The estimates were part of a statement from the automaker that revealed it had about 95,000 vehicles in its inventory that were built without certain components as of June 30, most of which were built in June. GM said it expects “substantially all of these vehicles” to be completed and sold to dealers before the end of 2022.
Despite the problems, GM stuck to previously announced 2022 guidance that included net income between $9.6 billion and $11.2 billion, adjusted pretax earnings between $13 billion and $15 billion, or 6.50 and 7 .50 per share, and an adjusted free car profit guidance cash flow range of between $7 billion and $9 billion.
In addition to inflation and other macroeconomic factors, the global auto industry has been grappling with supply chain issues caused by the coronavirus pandemic for more than a year — specifically, the supply of semiconductor chips that are used in vehicles.
The document was released before GM reported second-quarter U.S. sales that fell 15.4 percent from a year earlier
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