GM, Ford, Stelantis see profits despite challenges

Stelantis CFO Richard Palmer was less optimistic about chip supplies than other automaker executives, predicting they will remain scarce for the rest of 2022.

“I think it’s improving,” he said, “but it’s a slow process.”

Despite low inventory levels and price increases on a number of critical materials, automakers continued to capitalize on new vehicle demand.

For GM, half of the inflation experienced in the quarter was driven by commodity costs. The other half is related to logistics and other supply chain challenges, Jacobson said.

“Pricing remains strong,” Jacobson said, “and it is higher than our estimate at the beginning of the year, helping to partially offset the incremental commodity costs.”

GM’s average transaction price rose 5 percent to $50,261, according to Cox Automotive. Cox said Stelantis jumped an average of 12 percent to $54,065 and Ford’s rose nearly 10 percent to $51,995.

“As long as production increases and inventory builds up, we see that demand remains high,” Krebs said, “and so we would expect pricing to remain relatively high.”

Also, automakers are saving money by not offering much in the form of incentives.

Cox said the average discount fell to $1,201 per vehicle for Ford, $1,906 for Stelantis and $1,705 for GM.

Ford’s Lawler said the automaker expects strong demand for the rest of the year, despite economists’ concerns about a potential slowdown.

“The industry is still running stronger than we can supply,” Lawler said. “At this point, we haven’t seen it slow down.”

Michael Martinez and Vince Bond Jr contributed to this report.

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