By Dhirendra Tripathi
Investing.com – General Motors stock (NYSE:GM) fell over 7% Wednesday as the carmaker warned of semiconductor shortages, higher raw material prices and supply chain challenges even as it raised its forecast for the year.
The company lost market share in almost all segments and all geographies barring one and that weighed on the stock too. However, its share of the U.S. market for trucks rose to 31.2% from 30% a year ago.
It called the semiconductor shortage situation “fluid” and said it will look to prioritize products that have the highest-demand and are capacity-constrained.
The company expects to lose production of about 100,000 vehicles in North America in the second half while it anticipates commodity costs to rise by $1.5 billion-$2.0 billion, according to Reuters.
GM is not alone in suffering from semiconductor shortage. It has troubled almost all carmakers last one year as the pandemic-induced lockdowns in various parts of the world disrupted supply chains. Factories have been shut and production curtailed.
Prices of steel, rubber, glass and almost all inputs have risen. Shipping too has suffered.
Nonetheless, the company now expects full-year EBIT-adjusted in the range of $11.5 billion to $13.5 billion, compared to $10 billion-$11 billion previously.
According to Reuters, the more bullish outlook depends on GM having no vehicles stuck in inventory because of a lack of semiconductors.
Net income in the second quarter was $2.8 billion, or $1.90 a share, compared with a loss of $806 million, or 56 cents a share in the same period a year ago.