GM forecasts ‘significantly better’ earnings as chip shortage eases

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General Motors expects financial results in the first half of 2021 to be significantly better than previously forecast as shipments of semiconductor chips pick up in the second quarter, the automaker said Thursday.

The Detroit-based company also said it would ramp up production of large and medium pickup trucks, with about 1,000 additional Chevrolet Silverado HD and GMC Sierra trucks per month, starting in mid-July and an increase in shipments from Chevrolet Colorado and GMC Canyon with approximately 30,000 total units as of mid-May.

Shares of the company, which only recently resumed operations after factories were shut down due to a global semiconductor chip shortage, rose 3% before the bell.

“The global semiconductor shortage remains complex and highly volatile, but the speed, agility and dedication of our team … has helped us find creative ways,” said Phil Kienle, GM vice president, North America Manufacturing and Labor Relations.

Demand for new vehicles has increased during the pandemic as consumers prefer to travel by private car rather than public transport.

The company said it was “optimistic” for the full year and expects to share more information during its second quarter conference call on Aug. 4.

It had previously told investors it expected adjusted earnings before interest and taxes for the first half to be about $5.5 billion.