General Motors approved another $6 billion share buyback as the Detroit automaker continues to gain momentum into 2024.
Tuesday’s announcement follows a $10 billion share buyback authorization last November. Shares of the Detroit automaker rose 2% to $48.52 on Tuesday, while broader U.S. markets fell. GM shares are up 34% since the start of 2024.
GM, which announced in April that it would relocate its business Headquarters in Detroit to a new office downtown next year the dividend will also be increased from 9 cents per share to 12 cents per share.
This year has proven to be a bit of a renaissance for the storied company, whose shares fell to around $26 late last year. Aside from the pandemic in spring 2020, GM shares hadn’t fallen this low in a decade.
GM became one first-quarter profit of $2.97 billion, up 25% from the same period a year earlier, boosted by strong deliveries of pickup trucks and other higher-profit vehicles. Although U.S. auto sales fell slightly early this year, the company has focused on profitability and controlling costs. It easily exceeded Wall Street’s revenue and profit targets and raised expectations for 2024.
GM’s revival comes as rival U.S. automakers appear to be treading water even as new car sales remain healthy. Ford shares are up less than 1% this year and the company’s first-quarter net profit fell 24% from a year ago.
Stellantis reported a sales decline in the first quarter and its shares are down nearly 7% this year.
Elon Musk’s Tesla reported a sharp decline in sales in the first quarter due to increased competition and a slowdown in electric vehicle sales. Sales fell by 9% during this period, the first quarterly annualized sales decline in almost four years. The drop in sales came even as the company implemented numerous and generous price cuts on some models. Tesla shares have lost almost a third of their value this year.
