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  • Writer's pictureRealFacts Editorial Team

GM's $6 Billion Share Repurchase Plan

GM water tower

General Motors (GM) announced a $6 billion share repurchase plan on Tuesday, following a $10 billion stock buyback initiative outlined last November. Investors generally favor buybacks as they reduce the number of shares outstanding and can increase earnings per share. GM shares gained nearly 2% Tuesday after this news, while competitors Ford Motor (F) and Stellantis (STLA) lost ground. Tesla (TSLA), the automaker with the highest market capitalization, continued its downward trend, further contributing to the declines observed during this challenging year. 

Aparna Narayanan, Investors Business Daily author, reported, “GM tied the new share repurchase authorization to profitable sales of its combustion-engine vehicles. The company is also ‘growing and improving the profitability of our EV business,’ GM CFO Paul Jacobson said in a news release. ‘This allows us to continue returning cash to shareholders.’” However, GM provided a somewhat mixed update on its emerging EV business. While demand for electric vehicles is increasing, it is lower than anticipated. The company now expects to produce 200,000-250,000 EVs in 2024, down from a previous target of 200,000-300,000. Initially, GM had aimed to build 400,000 EVs by mid-2024. This slowing of EV production may be appreciated by some investors due to its current unprofitability even though it is expected to drive future growth.


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