On Wednesday, the 6th of February, 2019, the General Motor Co. had posted a better-than-anticipated quarterly profit, largely boosted by high-margin pickup sales & small SUV sales in the US market.
Apart from that, a slash on spending had also tallied on quarterly earnings, which were well above Wall Street’s expectation.
Citing data from the quarterly earnings report, the entire profit of United States’ number one automaker came from North America, catalyzed by the overhauling sales of lucrative pickups and SUVs, while the GM operations in South America and China had botched to proffer anything at all.
Following the release of the data, the share price of General Motor Co. jumpstarted, gaining over 0.81 percent so far to 39.62 listed in NYSE, although earlier at the day, it had retested key resistance at 40.37, posting a gain of over 1.5 percent.
A much stronger-than-expected fourth-quarter profit, catapulted by strong corporate earnings result, stood in alignment with its job cut programs, since it had announced on December 2018, that, the company would be halting production on five of their North American manufacturing plants, slashing over 15,000 full-time workers.
So far, it had been reported to trim 4,000 of its workforces related to IT sectors, despite repeated criticism. Addressing to the necessity of the cutbacks, the Chief Executive Officer of General Motor Co., Mary Barra said in a post earnings announcement, “We can’t run at a 70 percent utilization.
We had to improve that ... It’s a transition we have to go through. ” In fact, it is a well-known industry rule of thumb for the automakers, not to operate plants below 80 percent capacity.