General Motors (GM) designs, manufactures, and markets cars, crossovers, trucks, and automobile parts worldwide. Through its subsidiary, GM Financial, the company provides automotive financing services and leases products through GM dealerships. GM is a US dominant business where it generates about 82 % of its revenues.
Throughout 2023, GM has been performing well. GM reinstated its guidance at the end of November to include an estimated USD 1.1bn EBIT-adjusted impact from lost production as a result of the UAW strike.
With an estimated liquidity (cash, marketable securities, and available credit facilities of USD 13.5bn) of roughly USD 29bn, GM has a strong balance sheet. The available liquidity could be crushed rapidly during a more severe economic slowdown that curtails consumer auto demand.
The credit spreads of GM’s bonds are wider compared to rating peers. For fixed-income investors, the main opportunities are in bonds issued by General Motors and General Motors Financial.