GM Stock Rallies On Big Q3 Jump, 3 New EVs On Track For 2023 As Chip Supplies Improve| Investor’s Business Daily

James G. Cole

U.S. auto sales jumped 24% for General Motors (GM) in the third quarter, outpacing expectations, on strong consumer demand and better vehicle availability. But Q3 sales fell for Stellantis (STLA) and Toyota Motors (TM).




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GM stock and several peers rallied Monday, after a CarMax (KMX) warning sent car stocks tumbling last week.

Ford (F) and Honda Motor (HMC) are also among those teeing up to disclose September and Q3 sales.

Q3 U.S. Auto Sales Seen Modestly Lower

The annualized pace of U.S. new vehicle sales in September is expected to reach 13.3 million units, roughly in line with August, Cox Automotive estimates. By volume, sales in the third quarter are seen reaching nearly 3.4 million units, down slightly both year over year and quarter over quarter, following a sharp Q2 slump.

Cox expected GM, Ford and Tesla to be among the biggest gainers, year over year, in a Q3 market “still stuck in low gear” as supplies slowly improve.


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Tesla (TSLA) reported record global Q3 deliveries but missed views.

Here is how automakers are expected to perform in Q3, according to Cox Automotive. The results show sales volume, as well as sales growth or decline vs. a year ago.

General Motors

Q3 sales estimate: 539,028 vehicles, up 21.6%.

Results: GM sold 555,580 vehicles in Q3, up 24% year over year. In a release, GM touted improving chip supplies and vehicle inventories, as well as strong Bolt EV and pickup truck sales. But GM’s Q3 sales were down from 575,911 in Q2.

All of GM’s 2023 EV launches, including the Chevrolet Silverado pickup, Chevrolet Blazer and Chevrolet Equinox are on schedule, the company added.

GM stock rallied 2.3% in Monday’s stock market action. Shares sank nearly 10% last week and remain below the 50-day and 200-day moving averages.

Recently, GM started initial deliveries of two important new EVs, the Lyriq SUV and Hummer pickup. An Ultium battery factory finally began production recently. That will help Hummer and Lyriq production to increase in 2023, the company said in Monday’s release. Like other automakers, GM is shifting to electric vehicles from gas and diesel cars.

Toyota Motor

Q3 sales estimate: 513,846, down 9.2%.

Results: Toyota sold 526,017 vehicles in Q3, down 7.1% year over year. However, September sales of 179,050 vehicles were up 17.1% from a year ago. “Electrified” vehicles made up nearly 20% of September sales, including fully electric vehicles, fuel cells, hybrids and plug-in hybrids. Toyota’s Q3 sales were also down from 531,105 in Q2.

Toyota Motor stock rose 3.7% Monday. It sank to a 23-month low last week. On Friday, Toyota cut its October production goal by 6.3% to about 750,000 vehicles because of the chip shortage.

Ford Motor

Q3 sales estimate: 473,595, up 19.1%.

Results: Check back later.

Ford stock rallied 2.4% Monday. Shares remain far below the 50- and 200-day lines.

Stellantis

Q3 sales estimate: 388,481, down 5.5%.

Results: Q3 U.S. sales of 385,665, down 6%. Year to date, sales are down 12%. Stellantis’s Q3 sales were also down from 408,521 in Q2.

“Our dealers are making every effort to deliver upon each and every customer’s needs while we continue to deal with challenging industry supply constraints,” U.S. Head of Sales Jeff Kommor said in a Q3 sales release.

Stellantis stock rallied 3.4% Monday.

Honda Motor

Q3 sales estimate: 211,326, down 38.9%.

Results: Check back Monday.

Honda stock rallied 3.8% Monday.

Tesla

Q3 sales estimate: 126,844 premium and luxury EVs in the U.S., up 38.3%.

Results: Tesla reported record global Q3 deliveries that fell short of views. The EV giant blamed logistical challenges, but that could reflect China demand issues. Tesla will not break out U.S. sales, which likely were strong.

Tesla stock tumbled 8.3% on Monday, to their lowest levels since July. Shares reversed from near their 50-day and 200-day lines last week.

Outlook For Q4 Auto Sales

Analysts at J.D. Power and LMC Automotive expect production constraints to continue in October and lead to a “somewhat lumpy” fourth quarter. On Wednesday, analysts at Cox Automotive again lowered their full-year 2022 forecast, now predicting 13.7 million units, down more than 9% from 2021 and the lowest level in a decade.

Those warnings come after Ford cautioned on Sept. 20 that it could have 40,000-45,000 partially built vehicles in inventory at the end of the current third quarter, awaiting parts needed for completion. It still expects to complete and deliver those vehicles in Q4.

Car stocks sold off hard last week. Used-car dealer CarMax (KMX) badly missed earnings views Thursday, citing “affordability challenges” amid the rapid rise in interest rates. Moody’s downgraded the global auto industry to negative from stable, also citing customer affordability issues due to higher prices and weaker economies. It also noted higher costs for automakers.

Find Aparna Narayanan on Twitter at @IBD_Aparna.

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