Q4 2021 General Motors Co Earnings Call

February 1, 2022

Speaker 1: afternoon.

Good afternoon, and welcome to the General Motors Company fourth quarter 2022 earnings conference call. During the opening remarks, all participants will be in a listen only mode. After the opening remarks, we will conduct a question and answer session. We are asking analysts to please limit yourself to one question and a brief follow up to ask a question press star one on.

Your telephone keypad to withdraw your question Press Star two as a reminder, this conference call is being recorded Tuesday February one 2022, I would now like to turn the conference over to Rocky Gupta, Treasurer, and Vice President of Investor Relations.

Speaker 2: Thanks Jordan. Good afternoon and thank you for joining us as we review GM's financial results for the fourth quarter and calendar year 2021.

Thanks, Jordan good afternoon, and thank you for joining us as we review Gm's financial results for the fourth quarter and calendar year 2021.

Speaker 2: Our conference call materials were issued earlier this afternoon and are available on the GM investor relations website. We are also broadcasting this call via webcast.

Conference call materials were issued earlier this afternoon and are available on the GM Investor Relations website. We're also broadcasting this call via webcast.

Speaker 2: I'm joined today by GM's Chair and CEO Mary Barra, GM CFO Paul J.

And today about Gm's, chairman and CEO , Mary Barra Gm's CFO Paul Jacobson.

Speaker 2: GM Financial CEO Dan Burse and Cruse Co-Founder Kyle Boyce.

Financial CEO , Dan bursts and cruise cofounder Kyle Voigt.

Speaker 2: Kyle will be available to speak about Cruze's exciting progress in the Q&A portion of the call.

Kyle will be available to speak about cruise is exciting progress in the Q&A portion of the call.

Speaker 2: Before we begin, I would like to direct your attention to the forward-looking statements on the first page of the chart set. The content of our call will be governed by this language.

Before we begin I would like to direct your attention to the forward looking statements on the first page of the charts at the content of our call will be governed by this language. We will now turn the call over to Mary.

Speaker 3: Hey, thanks, Rocky. And good afternoon, everyone. Thanks for joining us. Before we get into our 2021 results and 2022 outlook, I want to start with some exciting news from Cruise, which is one of our most significant growth opportunities.

Hey, Thanks, Rocky and good afternoon, everyone and thanks for joining us I'll.

Before we get into our 2021 results in 2022 outlook I wanted to start with some exciting news from cruise, which is whenever most significant growth opportunities.

Speaker 3: Kyle, Dan Khan, Gil West, and the entire cruise team are doing great work, and they just delivered a key milestone on the drive to commercialization to commercialize cruise ride-share service. As Kyle has shared, cruise team members have been taking fully driverless rides in San Francisco since November to demonstrate and refine the software and hardware ecosystem we have created together. In fact, they have logged over 20,000 miles and completed more than 600 trips.

While Dan can Gil west in the entire cruise team are doing great work and they just delivered a key milestone on the drive to commercialization to commercialize cruise Rideshare service as Carla shared crews team members have been taking fully driverless rides in San Francisco since November to demonstrate and refine the software and hardware.

<unk> system, we have created together in fact, they have logged over 20000 miles and completed more than 600 trip.

Speaker 3: I rode in a driverless cruise a couple weeks ago and I can tell you it was the highlight of my career as an engineer and as the leader of General Motors. The ride is smooth and confident, it's like having an experience and a ten of driver behind the wheel.

I wrote in a driverless crews a couple of weeks ago and I can tell you. It was the highlight of my career as an engineer and as the leader of General Motors, the riotous smooth and confident it's like having an experience and a tenant driver behind the wheel.

Speaker 3: Now, as crews announce this morning, it is inviting members of the public to sign up for their own driverless rides through a wait list on the crew's website. This is the first truly driverless ride-hale service offered to members of the public in a dense urban environment.

Now as crews announced this morning. It is invited members of the public to sign up for their own driverless rides through a waitlist on the cruise website.

This is the first truly driverless ride hail service offered to members of the public in a dense urban environment to maximize its learnings crews will prioritize use cases that are all natural fits for autonomous ride sharing.

Speaker 3: To maximize its learning, crews will prioritize use cases that are on natural fits for autonomous ride sharing.

Speaker 3: This major milestone brings crews even closer to offering its first paid rise and generating $50 billion in annual revenue by the end of the decade.

This major milestone brings crews even closer to operate its first paid rides and generating $50 billion in annual revenue by the end of the decade.

Speaker 3: It also means that the Softbank Vision Fund will invest as planned another $1.35 billion in crews. This is another strong vote of confidence in the crew's team, its technology and the services it's creating. Additionally, crews continue to advance the strong relationship it has established with Walmart, where the team is making progress on driverless deliveries of groceries to customers every day.

It also means that the Softbank vision fund will invest as planned another $135 billion in crews. This is another strong vote of confidence in the cruise team its technology and the services. It's creating additionally cruise continues to advance the strong relationship. It has established with Walmart where the team is making progress on.

Driverless deliveries of groceries to customers every day.

Speaker 3: With this incremental investment and the investments from general motors and companies like Honda, Microsoft, and Walmart, Cruz is very well capitalized to scale its business when the origin production comes online at Vector Zero late this year. So, Kyle, congrats.

With this incremental investment and the investments from general Motors in companies like Honda, Microsoft and Walmart cruise is very well capitalized to scale its business. When the origin production comes online at factory zero late this year, so Kyle congrats.

Speaker 3: Now I want to turn to the significant investments we are making to expand both our battery cell and EV assembly capacity.

Now I want to turn to the significant investments, we are making to expand both our battery cell and EV Assembly capacity.

Speaker 3: We believe our strategy to scale a common ultim cell, components set, and platform will create significant long-term value for all GM stakeholders. We also recognize that we need to launch more EVs faster, so that's exactly what we are going to do.

We believe our strategy to scale, our common altium cell components set and platform will create significant long term value for all GM stakeholders. We also recognize that we need to launch more evs faster. So that's exactly what we're going to do.

Speaker 3: As you know, the GMC Hummer EV is already in the market. Cadillac Lyric deliveries begin in less than 60 days. An additional bright drop EV 600 production begins at Kami late this year, where we'll launch with an annual capacity of 30,000 units and the ability to nearly double production by mid-decade. The Chevrolet Silverado EV launches next spring, and the Chevrolet Equinox and Blazer EVs will also reach the market in 2023.

As you know the GMC Hummer EV is already in the market Cadillac lyric deliveries begin in less than 60 days and additional break dropped even 600 production begins at <unk> late this year, where we'll launch with an annual capacity of 30000 units and the ability to nearly double production by mid decade.

The Chevrolet Silverado EV launches next spring and the Chevrolet Equinox and Blazer Evs will also reach the market in 2023.

Speaker 3: We have the teams working to accelerate the volume curves for all of these launches and to resume both EV and EUV production as soon as possible. And we have set a target to deliver 400,000 EVs in North America over the course of 2022 in 2023.

We have the teams working to accelerate the volume curves for all of these launches and to resume bolt EV and EV production as soon as possible and we have set a target to deliver 400000 Evs in North America over the course of 2022 in 2023.

Speaker 3: As you know, we have also announced additional battery cell and assembly capacity investments in Michigan that will give us more than 1 million units of EV capacity in North America by the end of 2025, and this includes 600,000 full-size trucks.

As you know we have also announced additional battery cell and assembly capacity investments in Michigan that will give us more than 1 million units of EV capacity in North America by the end of 2025 and this includes 600000 full sized trucks.

Speaker 3: This is in addition to more than 1 million units of EV capacity in China over the same time frame. And I can tell you right now, 1 million units in North America won't be enough to meet the steep influxion in demand that we expect starting mid-decade for REBs. That's why we will continue to convert ice capacity to EVs and plan to invest in a third EV truck plan.

This is in addition to more than 1 million units of BV capacity in China over the same timeframe and I can tell you right now 1 million units in North America won't be enough to meet the steep inflection in demand that we expect starting mid decade for <unk>. That's why we will continue to convert ice capacity to <unk> and <unk>.

Planned to invest in a third EV truck plant.

Speaker 3: We are formulating plans for the truck plant right now, and we will share more as we work through the details.

Are formulating plans for the truck plant right now and we will share more as we worked through the details.

Speaker 3: Importantly, battery cells will not be a constraint to our long-term EV growth. Our ultim-celled JVs in Ohio and Tennessee come online in 2022 and 2023 respectively, and we will add capacity as demand grows. Our Ohio plant will launch with seven-day operations adding 10% capacity and 200 jobs. Cell production in Michigan is scheduled to begin in late 2024.

Importantly, battery cells will not be a constraint to our long term EBIT growth or altium cell Jv's in Ohio, and Tennessee come online in 2022, and 2023, respectively, and we will add capacity as demand grows our Ohio plant will launch with seven day operations, adding 10% capacity and 200.

<unk> cell production in Michigan is scheduled to begin in late 2024.

Speaker 3: And I'm sharing today that we will announce the location of our fourth US cell plan in the first half of this year.

And I'm sharing today that we will announce the location of our fourth U S cell plant in the first half of this year together. These plants will support Gm's EV volume growth and supply our customers and the rail trucking aerospace and Marine industries.

Speaker 3: Together, these plants will support GM's EV volume growth and supply our customers in the rail, trucking, aerospace, and marine industry.

Speaker 3: Equally important for our EV strategy for North America is that it is backed by a strong, more sustainable North American focused supply chain that includes lithium, rare earth material, permanent magnets, cathode active material, silicon carbide, motor stators, and more. To deliver this acceleration, we are pulling ahead significant investment into the 2022 to 2025 time frame. And we will share more details as we further refine our plan.

Equally important for our EV strategy for North America is that it is backed by a strong more sustainable North American focused supply chain that includes lithium rare earth materials permanent magnets cathode cathode active material silicon carbide motor staters and more to deliver this acceleration we are pulling.

[noise] ahead significant investment into the 2022 to 2025 timeframe and we will share more details as we further refine our plans.

Growing customer demand for the first wave of Altium products strongly supports these investments we already have more than 59000 reservations for the GMC Hummer EV pickup and SUV not surprisingly some of the first owners are very prominent figures in the sports and entertainment industries and their initial feedback has been just out.

Speaker 3: We already have more than 59,000 reservations for the GMC Hummer EV pickup and SUV.

Speaker 3: Not surprisingly, some of the first owners are very prominent figures in the sports and entertainment industries and their initial feedback has been just incredible. They expected a super truck and they got one.

Incredible they expected a super truck and they got one.

Speaker 3: Our next electric pickup will be the Chevrolet Silverado EV. More than 110,000 Silverado EVs are reserved so far, including reservations for more than 240 fleet operators, and the numbers keep growing every day.

Our next electric pickup will be the Chevrolet Silverado EV more than a 110000 silverado evs are reserved so far including reservations for more than 240 fleet operators and the numbers keep growing every day.

Speaker 3: Some of the world's largest fleet customers, including FedEx, Verizon, Merchants Fleet, and Walmart, are adopting bright drop vehicles and their technology. All told, we have more than 25,000 production reservations for bright drop cargo van. And customer interest in the Cadillac lyric is growing so quickly that we'll for go a new round to reservation and begin taking customer orders soon after the debut edition launches in March.

Some of the worlds largest fleet customers, including Fedex, Verizon merchant fleet, and Walmart are adapting bright dropped vehicles and their technology. All told we have more than 25000 production reservations for bright drop cargo vans.

Customer interest and the Cadillac lyric is growing so quickly that will forgo a new round of reservation reservations and began taking customer orders soon after that.

<unk> edition watches in March.

Speaker 3: One of our most highly anticipated reveals this year will be the Chevrolet Equinox EV, which we previewed in January . The Verge named it the best electric car of CES, saying, there's a perception that electric vehicles are luxury items, so when General Motors said the Equinox would come with a $30,000 sticker price, it's something worth noting.

One of our most highly anticipated rebuilds this year will be the Chevrolet Equinox, EV, which we previewed in January the verge named it the best electric car of CES, saying, there's a perception that electric vehicles are luxury items that when general Motors said, the equinox would come with a $30000 sticker price, it's something worth noting.

Speaker 3: The efficiencies created by the Altium platform are a key reason why we will be able to deliver truly affordable EVs like the E-Planet.

The efficiencies created by the Altium platform are accrete key reason, why we will be able to deliver truly affordable evs like the equinox.

Speaker 3: Affordable EVs are part of the market that startups aren't targeting, but they are key to driving mass adoption of EVs, which is a national and a global priority. That's why we plan to follow the Equinox with an even more affordable EV.

Affordable Evs are part of the market that startups aren't targeting but they are key to driving mass adoption of Evs, which is a national and a global priority. That's why we plan to follow the equinox with an even more affordable EV.

Speaker 3: Now let's shift and talk a little bit about our other GM growth platforms. Throughout the year, you will see the expansion of advanced vehicle technologies, new shopping tools, and continued progress at our new business startups. This spring, we will launch redesigns of the Chevrolet Silverado and the GMC Sierra 1500 pickups and offer them with SuperCruise, with expanded capabilities that include lane change on demand and hands-free trailering. These are first for the segment.

Now, let's shift and talk a little bit about our other GM growth platforms throughout the year, you will see the expansion of advanced vehicle technologies, New shopping tools and continued progress at our new business start ups. This spring, we will launch redesigns of the Chevrolet Silverado and the GMC, Sierra 500 pickups and offer them with <unk>.

<unk> crews with expanded capabilities that include lane change on demand enhanced free trailing these are first for the segment.

Speaker 3: In the same time frame, GM and our dealers will begin marketing CarBravo, our new used vehicle shopping service. This is truly a win-win. Our dealers will grow their business by offering customers online access to far more inventory than other services.

At the same time frame GM and our dealers will begin marketing car Bravo, our new used vehicles shopping service. This is truly a win win our dealers will grow their business by offering customers online access to far more inventory that other services in turn we expect to drive incremental GM and GM financial revenue by selling.

Speaker 3: In turn, we expect to drive incremental GM and GM financial revenue by selling products like OnStar Insurance, OnStar Connected Services, Accessories, and Financial Services. It will also help support strong residual values for off-lease vehicles.

Like Onstar insurance Onstar connected services accessories, and financial services. It will also help support strong residual values for off lease vehicles.

Speaker 3: Then next year, we'll roll out Altify, a new end-to-end software platform for EVs, AVs, and ICE vehicles that will have even more sweeping over-the-air capabilities than we have today. This includes the ability to back-cast features to the Cadillac Lyric. Altify will be the foundation for new GM-developed and approved third-party apps, in-car subscriptions, and other connected services that enhance the customer experience and expand our revenue through the life of each vehicle.

Then next year, we will rollout altafaj, a new end to end software platform for Evs Avs and ice vehicles that will have even more sweeping over the air capabilities than we have today. This includes the ability to back half features to the Cadillac lyric also <unk> will be the foundation for new GM developed and approved third party apps in <unk>.

Our subscriptions and other connected services that enhance the customer experience and expand our revenue through the life of each vehicle.

Speaker 3: We can and we will keep up our aggressive pace backed by strong results. We expect to follow our record EBIT adjusted earnings in 2021 with another year of record or near-record results in 2022, while investing significantly more year-over-year to accelerate our growth.

We can and we will keep up our aggressive pace backed by strong results. We expect to follow our record EBIT adjusted earnings in 2021 with another year of record or near record results in 2022, while investing significantly more year over year to accelerate our growth.

Paul will share more details on our results and guidance in his remarks, but before I turn the call over to him I would like to discuss our capital allocation strategy.

The prospect of continued strong earnings and free cash flow, even as we invest for growth naturally raises questions about resuming resuming a common stock dividend as we move forward, we will consider all opportunities to return excess capital to shareholders, but we will not reinstate a dividend at this time.

Our clear priority is to accelerate our <unk> plan and drive growth and we want to maintain maximum flexibility to invest as opportunities arise across our growth platforms, including many of the accelerated plans I've outlined today I think we've consistently demonstrated that we're a team that delivers on our commitments.

That's more important now than ever with the incredible opportunities in front of us.

So now I'm going to turn the call over to Paul who will walk us through the quarter and our outlook then Paul dam burst call vote, and I will take your questions.

Thank you Mary and good afternoon, everyone.

Truly appreciate you taking the time to join us.

As Mary mentioned, the strong results last year, including record full year EBIT adjusted and EBIT adjusted margins are a reflection of the hard work and execution from our team and the underlying strength of our business.

We're seeing strong demand for our products, especially our trucks and Suvs and we are striving again this year to produce as many of them as we can I want to thank the entire GM team once more for the execution during this past year.

The cash that we generate today is funding the transformation of GM in pursuit of the growth strategy, we shared last year at our Investor day, we.

We see a path to doubling revenue by 2030, while expanding margins with significant opportunities in software services, and new businesses and electric and autonomous vehicles.

Now, let's get into the results.

While we lose the well publicized global semiconductor challenges and continued pressure from Covid protocols throughout the world. The GM team once again delivered tremendous results in 2021 through our production prioritization and work across our value chain.

For the full year, we generated $127 billion in revenue $14 $3 billion in EBIT adjusted 11, 3% EBIT adjusted margin.

$1 seven in EPS diluted adjusted and $2 6 billion and adjusted automotive free cash flow.

In the fourth quarter, we generated $34 billion in revenue $2 $8 billion in EBIT adjusted eight 5% EBIT adjusted margin of $1 35 in EPS diluted adjusted and $6 4 billion and adjusted automotive free cash flow.

Free cash flow in the quarter was largely driven by working capital re one as we were able to complete in wholesale over 80000 vehicles that had previously been built without certain components as well as dividends from GM financial.

We saw improved semiconductor availability in the fourth quarter compared to the third quarter, which enabled us to increase our wholesale sequentially, while substantially reducing our inventory of vehicles built without certain components and we expect ongoing semiconductor availability improvements throughout 2022.

We also realized strong price and mix performance in North America through our production prioritization actions and our go to market strategy.

Additionally, used vehicle prices and strong credit performance continued to drive record results at GM financial.

Let's take a closer look at North America.

In Q4, GM North America delivered EBIT adjusted of $2 $2 billion as we continued to see robust customer demand for our products and tight dealer inventory driving strong transaction prices.

These results were somewhat better than our December updated guidance expectations as we saw continued volume and cost improvements on.

On a year over year basis in the fourth quarter, we saw volume decreases and increased investments in growth, partially offset by pricing and mix.

U S dealer inventories ended the year at around 200000 units of which only approximately 25% is grounded stock resulting in continued high sales turns of around 10 days.

Moving to GM international in the fourth quarter GMI EBIT adjusted was approximately 0.3 billion relatively flat year over year.

China equity income was <unk> $2 billion in the quarter with continued strong mix stabilization in pricing and material cost performance offset by semiconductor and commodity impact.

As we referenced last quarter, our international business outside of China has made substantial progress on our path to sustainable profitability GMI EBIT adjusted excluding China equity income achieved profitability in the fourth quarter. Despite continued semiconductor pressure and the Chevrolet brand has regained its retail.

Market share leadership in South America.

A few comments on GM financial in the Corp segment.

Jim Financial concluded another extremely strong year with Q4 EBT adjusted of $1 2 billion with record full year EBT adjusted of $5 billion GM financial paid an additional $1 $7 billion dividend in Q4.

That brings the total GM financial dividend to $3 $5 billion in 2021 equivalent to how much we paid for the company.

Going forward, we expect GM financial dividends to moderate as earnings normalize and we continue to grow the asset base.

Corp, EBIT adjusted in Q4 was down year over year by about $5 billion driven by the non recurrence of mark to market gains recognized in Q4 2020.

Now turning to our outlook for 2022 today.

We expect total company volume to increased 25% to 30% year over year with the majority of the increase occurring in the second half of the year, primarily due to the production constraints in the second half of 2021 sequentially.

Sequentially, we expect the positive trend to continue with Q1 wholesale volumes up 20% to 25% versus Q4 2021.

In 2022, we anticipate light industry sales of approximately 60 million units dealer stock to remain tight and the dynamic where production is the gating factor for sales volumes continuing into 2022.

As you think about the mix of this incremental volume remember that in 2021, we largely protected our high demand truck production as a result of the incremental volume in 2022 will be mostly weighted towards small and midsize Suvs and sedans.

Now, let's turn to our expectations for growth investments and margin.

A very important stage in the growth and development of some of our key businesses and we are taking the very intentional steps of investing heavily into them to accelerate our expansion.

<unk> expenses are expected to increase as they rapidly approach commercialization and higher around 500 additional employees, increasing their workforce by around 20% to advanced technology as.

As well as accelerate the operational infrastructure to grow and expand.

We also expect to see some wage rate pressures, we continue to attract top talent to the company.

Corporate expenses are expected to increase by approximately <unk> $5 billion as we expand the bright drop risen this business excuse me, including product development and manufacturing spend to prepare the CAMI facility for LCD production later in the year and expanded customer pilots for the <unk> electric cars.

Which we expect will drive software and services recurring revenue opportunities.

Continue to rollout onstar insurance across the countries. We're in 46 states today and expect to be in all 50 by the second quarter.

We're to develop new products at GM defense and continue to incubate new ideas to drive incremental growth and value in the future.

We're also expecting to invest another $1 $5 billion in expenses to expand software development and further accelerate our <unk> portfolio, which includes close to $1 billion of incremental engineering and software related development.

These investments are building the foundation to grow and accelerate our AAV EV and software businesses as we aggressively launch approximately 20 EV products in North America, and more than 30, EV products globally through 2025 and introduce ultra class.

These investments will also drive meaningful revenue growth starting in 2023, initially from Evs right dropping crews, but expanding the software and services as we launch <unk> and grow other new business opportunities such as Onstar insurance in Gms effect in the next few years.

We're now also expecting commodities and logistics cost pressure of two and a half a billion dollars year over year, primarily weighted to the front half of 2022.

From a non operating perspective, we expect a combined $1 billion year over year headwind from the non recurrence of mark to market gains we achieved in 2021 and a reduction in net pension income as we further derisked the planned asset profile.

I want to reiterate that despite all of this we expect to generate 10% North America EBIT adjusted margins in 2022 inclusive of the increased expenditures related to our growth investments and highlighting our ability to fund these initiatives through internally generated cash flow.

In China, we expect equity income from our joint ventures to exceed $1 billion and remained relatively flat year over year, we anticipate a modest increase in volume, which will be offset by a more normalized mix competitive pricing environment and increased investments as we prepare to bring more EV products to market.

We expect GM financial performance to be in the three and a half to $4 billion range as we do not expect a repeat of some of the 2021 allowance releases and we anticipate that credit performance in used vehicle prices will begin to moderate.

Assuming continued steady demand for new vehicles, no significant new economic or supply chain challenges in 2022, we expect EBIT adjusted in the $13 billion to $15 billion range.

Diluted adjusted in the $6 25.

725 range and adjusted automotive free cash flow in the $7 billion to $9 billion right.

Adjusted automotive free cash flow will be driven by strong earnings and working capital Rewind as volumes increase we expect capital spend to be in the $9 billion to $10 billion range in 2022, including investments in our also Altium battery cell JV and expect similar levels of spending over the next several years.

In summary, we had a strong finish to the year and our results are a reflection of the team's focus and execution in the face of the continued challenging environment.

In 2022, we expect strong commercial performance and we are aggressively reinvesting some of our short term EBIT improvement to accelerate our E V. A journey, while still driving similar results to our record performance in 2021.

This demonstrates the strength of our underlying business the strength of our truck and SUV franchises, our industry, leading customer loyalty and world class manufacturing and design capabilities. We will continue to leverage these competitive advantages as we vastly expand our battery cell and EV Assembly capacity in North America to lead the.

Industry.

This concludes our opening comments and we'll now move to the Q&A portion of the call.

A reminder to analysts we are asking to limit yourself to one question and a brief follow up so that they may get everyone on the call. Our first question comes from the line of Rod Lache with Wolfe Research. Your line is open.

Hi, everybody.

Congratulations on these results and the outlook.

I'll ask two questions first just financial one for Maryann. Paul you you guys have almost 22 billion of cash.

Your U S pensions now about fully funded <unk> got $40 billion of liquidity.

We've shown a lot of resiliency in different financial conditions, and operating conditions and are talking about $79 billion of free cash next year. So that's going to lead to some speculation on where the these investments could be that.

That youre contemplating.

<unk> instead of.

Cash returns. So can you maybe talk about or are there investments that youre thinking about that are large enough that would consume cash of that magnitude.

So rod Hey, Thanks for the question and you know as we look at it we're going to follow the capital allocation framework that we're going to continue to invest in opportunities that allow us to generate returns our return on invested capital of greater than 20% maintain an investment grade balance sheet, and then return the balance to shareholders.

We talked about a lot of it.

Pull ahead and acceleration to our EV strategy and you know as we worked through that we will follow that will look for those good investments and then we'll follow the capital allocation framework. So thinking J R. In February it's a little early to look at that but we'll provide more guidance for the year on that.

Okay.

I was hoping to ask a question of Kyle.

Youre currently.

Gratulation is by the way on the milestones that you've achieved.

These these operations look pretty impressive can you talk a little bit about what the operations look like in prime time, so during the day more congested periods.

2021, it seems like it's kind of a step between R&D and commercialization could you maybe give us a little bit more of a sense of what commercial scale will look like and what kind of pace of expansion, we should be thinking about it at one point you you.

We're talking about I think a new city every six months something along those lines, but any update on that.

Hi, Rod. Thanks for the question Yeah. There has been a very eventful day for us in a really good 2021 as we enter early commercialization.

Our approach to bringing driverless cars too dense urban environments has been a cautious and careful one.

Starting with limited hours of the day limited Geofence and what we're looking to do is confirm that the performance and functionality of our system matches expectations and also that we give the communities, where we're operating a little bit of time to acclimate, especially San Francisco, which is the first one first dense urban environment that's ever experiences. So.

We're going slowly and cautiously, but as we see things click and evidence that.

Performance is meeting expectations. The focus becomes exactly what you mentioned, which is how quickly can we expand this to cover our largest service area more hours serve more customers in San Francisco, but then beyond that and so we've been developing the foundational technologies.

To do those expansions in the background and we've learned a lot by our operation in other cities like Arizona.

Sorry in Arizona and in Michigan.

So we have a pretty good idea of what's around the corner, but we're gated by safety and we're just at the very early days. So it's hard to know our exact creative expansion.

Okay. Thank you.

Our next question comes from the line of John Murphy from Bank of America. Your line is open.

All right good afternoon everybody.

Your first question.

On the on the core business and when we think about the 25% to 30% increase in wholesale.

Imagine that mimics production I'm, just curious as you think about that.

In the context of a 16 million unit Saar it seems like there'll be some inventory build but not not not a lot. So if you wind up together with car Bravo. It does seem like youre pushing to keep Adp's high it makes it relatively high and maybe transition some of your entry level buyers were entry level product into the used car.

Market, which supports where there is more structurally going forward. It just seems like youre getting a very good circular reference keeping a lid on inventory and then winding it up with carb Bravo I mean, what is the real opportunity here on car Bravo and then ultimately what could it mean for sort of this inventory.

Inventory management on the new vehicle side. It just seems like it's a very intertwined very positive story.

Yeah, Hey, John Good afternoon, and thanks for the question.

What I would say that for 2022, it's largely more of a function of what we continue to believe as large pent up demand for new vehicles that hasnt been met in 2021 because of some of the production challenges certainly what we saw as we were able to complete those vehicles.

There was a little bit more going through the system.

Production and and as we've talked about in the prepared remarks, those vehicles continue to sell very very rapidly. So despite the production increases we saw in Q4.

Still not really building inventory that much and I think that's going to probably continue throughout the year with largely showing up in transit rather than on lots.

That's really on the consumer and I think that's the short term when you think about car Bravo I would think about it in terms of the volume and the access to inventory that we have through GM financial through the dealer network. It really is unprecedented level that gives customers much much better choice and variety across.

Across the country and we can do this in a coordinated fashion largely because of where we are with vehicles coming off lease the GM financial inventories across the board. So we actually see this as a really really strong opportunity in and of itself to expand the customer relationship and the entire sort of.

Universe of the customer that that we're working through and we talked about at Investor day.

Okay, and then just to follow up on that I mean, it seems that youre tightening up and growing the core to drive more profit to fund the future.

This cruise news today.

Just sort of add my congratulations too on that to everybody on the team.

As you grow in San Francisco, and then repopulate the strategy in other markets I mean, how do we think about the fleet and the capital required there to kind of follow up on Rob's question, I mean could there be a huge call on capital. So you could actually have very good returns and what is the earnings potential in that $50 billion I got I mentioned the margin is.

<unk> higher than the core business at 10%. So I mean, how should we think about those earnings.

In 2030, so capital requirement, we own the fleet, where the earnings go.

Yeah keep in mind, John that we announced last year that GM financial has committed.

Committed to a $5 billion line of credit to help finance the origin. So I think when we look at capital.

Our expansion as well as for the continued development, we're not seeing any constraints in that at all.

Cruise is very well capitalized they're very well prepared.

For the expansion phase as they continue to roll this out and achieve their milestone.

I'm sorry in the profitability potential on this I mean, it just seems like.

10% $5 billion as just.

And opening bid, it's probably a tremendous amount higher than that I mean, what are you roughly say good run rate.

Net profitability.

John I think as we look we see there's a huge first mover opportunity to go and provide an exceptional customer experience and so we're going to we do think there's tremendous.

Margin potential in this business, but we also think growth is really important and so youll see us balance that in the early days to really get a foothold a solid foothold in a leadership position. So you know down the road, we see tremendous profit, but we're gonna really we're going to scale fast.

It seems like a huge opportunity. Thank you very much.

Our next question comes from the line of Joe Spak with RBC capital markets. Your line is open.

Thanks, Good afternoon.

I appreciate the update on the Lordstown and Springhill holds themselves build out.

And when those are starting I was wondering if you could provide a little bit more color in terms of either from a run rate basis, or maybe just an absolute basis, where you think each of those.

Or how long, it's going to take those facilities to get up to their stated capacity and then maybe just.

A quick aside like sports center opening mid 'twenty, two where are you actually getting ultra michels for the hummer that bright dropping alert.

Today, we are getting those from from LG.

But as we look we're going to ramp up those plants as quickly as we can with one coming on line on 22, one on 'twenty three and then one late 'twenty four and one yet to be announced so.

We're going to accelerate those as fastest as we can as I said in my prepared remarks, we've already found ways to add capacity from an operating perspective and efficiencies in the plants. So.

We're just going to keep going full out because we see the opportunity for substantial EV volume growth in this period of time.

Okay, and then I guess following up on that and I know you've mentioned in your remarks, Mary Youre not you don't really think you are constrained by your your cell supply here, but it does seem like you have at least.

Over the next year or so maybe an allocation decision.

What programs those sales go to so for instance in 23 of both the Silverado and equinox. So how do you go about deciding whether it sort of goes towards.

You know potentially a more profitable vehicle or a segment, where you see less competition and more and more potential white space.

Well I think we're working to expand our capability to accelerate all of those models as I said you know, we're just seeing such strong demand and that's caused the team to really go back and look and say, okay, let's double down and go faster from an acceleration perspective, clearly the cells will be something.

Something that we'll look to grow as well one of the reasons why we're announcing the battery plant that we already did in Michigan and will shortly be announcing the fourth battery plant.

As well as continuing to work with LG. So.

Our focus right now not on tradeoffs, but on an Ah Ah, enabling as many as we can during this period of time and you heard me say that between 22 and 23, you know we want to our plan is to have over 400000 evs into market in North America, and we're just going to keep working to improve that and I have a lot of confidence in.

The GM team that when you give them a clear challenge they rightfully occasion.

Thanks.

Our next question comes from the line of Adam Jonas with Morgan Stanley . Your line is open.

Thanks, everybody I had a question about the EV models and implied volume per SKU.

I ask it like this if you were starting an EV companies from scratch would you.

Launch 30 different models over a three or four year period I understand why.

I guess I understand why GM with the brands in different regions and things that attempted to do it but if you had the alternative where we consider the alternative of.

Higher volume in hundreds and hundreds of thousands of units per model, but a small number of models.

So so Adam.

We're going to we're going to go for both and kind of General Motors perspective, I think when you look at how we've approached the technology and the investments we've made in all Tam and how we're looking at the portfolio of full portfolio because again, if you look at and by the way. We think several of those models are going to be.

Over 100000 units or more than that.

We do that so I really would say Adam we're going for both and it's one thing when you're looking at the market when it's 2%, 3%, 5%. We're looking by 20 2030 to be in the 40% to 50% adoption and to do that you've got to meet the customer where they're at and that's why you look at the equinox It has to.

Significant that can be the the more affordable EV.

<unk> that we're going to be doing that really gets into another very important part of the market. So you have to have the proper market coverage otherwise the customer is going to have to make tradeoffs and because of Gm's capability. You know like general motors at any one point in time, we have almost 100 programs in flight, meaning in concept to being launched.

The capability the GM team has so we're moving with the speed of a startup with I think industry, leading technology and our platform. But we're also then leveraging that capability that GM has to attract and gain share and grow because of the the vehicles that will have that meet their needs.

Thanks, Mary just as a follow up how certain are you that the quality problems that you had with your battery partner have been resolved, obviously, you're implying there is some improvement but could you tell us are all the issues behind you or are there still some issues that you're working through in real time. Thanks sure. So Adam.

We're already putting new battery packs into existing bolt evs and avs, we wouldn't be doing that if we didn't have confidence.

LG technical team and the <unk> team have worked together, we believe as we said before that it was to vary.

Rare manufacturing defects that caused the issue and if you look at the low number of issues, we had yet the the extraordinary action that we took with recalling the you know the entire population that's our commitment to safety and so we have found the issues, we've put a lot more robust processes into the manufacturing.

Process and changed the way the pricing processing is to make sure. We don't have that issue I'd also note that the that was rich learnings that we had from our LG partners that have been incorporated into Altium. So you know again the experience that we've had of selling bolt evs for awhile and bolt Evs.

All of that learning is translated in it gives me great confidence in the quality of the Altium platform and the packs that were putting into the bolt evs in either of these right now.

Thanks Mary.

Thanks, Adam.

Our next question comes from the line of <unk> Kelly with Citi. Your line is open.

Great. Thank you good afternoon everybody.

Just two questions, maybe first going back to a Z from Marion Kyle, but maybe I think in the past you referred to the opportunity and personal consumer AZ as upside potential through 2030 target I was hoping you could update us on the vision you have for consumers.

As well as our cruisers role within that in the long run.

Well for right now with a significant announcement that cruise made today. We want you know the team like 99, 9% focused on making sure that we seize the significant opportunity in ridesharing rideshare delivery.

And we said most recently at the end of last year that we see and at CES that we see the opportunity for potentially as early as mid decade, yeah personal autonomous vehicles, which is a.

A really an additive thing for cruise because it puts more nodes on the network. It opens up another another market. So we're very focused on rideshare and rideshare delivery. So this is something that we see potentially an and mid decade that we can make both businesses grow so a huge opportunity and I know Paul if you want to add anything.

Yeah. Thanks, that's a natural fit.

Retail <unk> wood increases total volume of sensors and computer systems, we're building it.

More vehicles that are R&R common platforms.

Our newest fleets of driverless cars.

Drive down the cost on a unit basis, and really reinforces and bolsters the core robo taxi business. So we see it as a really a win win situation.

It improves the economics of the Robo taxi business, but also.

<unk> enables a new market and the expansion of the positive impact from this technology.

So that's very very helpful and maybe a quick follow up maybe for Paul.

You could dimension.

Bearable profit opportunity from the refreshed our full size pickup trucks I think are coming in the spring both in terms of maybe pricing opportunities with the new content as well as any opportunities with the upgraded electrical architecture.

So what I would say is.

Excuse me Seth.

What we see right now and what we continue to see is a really really strong consumer preference, especially.

They're buying up on features and amenities, we see that across the board in the in the Denali brands high country brands et cetera of that.

There's going to continue to pay big dividends for us as we rollout.

The new vehicles going forward, so without getting into specifics on on vehicle margins and profitability. We're very excited about what that's going to bring and we think that the consumer is.

Is gonna be really really positive around them.

Great. That's all very helpful. Thank you.

Our next question comes from the line of Emmanuel Rosner with Deutsche Bank. Your line is open.

Thank you very much two questions. Please.

The first one could you please describe the current supply chain.

Environment any constraints to lift on the <unk>.

Chip availability and in particular I'd be interested to hear what gives you confidence that you have sufficient chip available could you produced 25% to 30% more vehicles in 2022 versus 2021 admittedly you were hit maybe a bit harder than other players but.

We see this as a nice size Tom Smith.

Yeah, I mean, you will thanks for the question. What we're sharing is is what we see with the work that we've done with all of the semiconductor manufacturers and in our plans for this for this year. So you know of course, and Paul said if.

If there is a significant COVID-19 disruptions or other natural disasters that that could have an impact, but we're pretty we're seeing definitely seen improvement in first quarter over fourth quarter, we saw fourth quarter better than third quarter, and we really see with the plans we have in place now by the time, we get to third and fourth quarter. You know, we're gonna be you know really starting.

Two to see the semi conductor constraints diminish.

So that's what we're working to achieve a cross.

All of our platforms and across the globe frankly, with all of our suppliers, but that's that's our best current outlook that we're sharing.

Great. So just a quick aside on this and I have a second question on the cruise, but just a clarification. The 25% 30%. You are you confident you can do this in North America since I think for China C pulse.

We're looking probably its more stable volume year over year.

Hey, Emmanuel 25% to 30% of the global production number. So there's there's some in the U S and there's some in the GM international as well.

Understood and then second question would be on.

On crews.

Are your current thoughts on optimal timing to bring this to two capital markets not just because of our growing capital needs with the commercialization, which seems like you have that are well in place, but also as a way to potentially unlock.

Some additional value for shareholders.

Yes, Emmanuel you know and I have always said.

And if you know the beliefs is held by you know I'd say the cruise board and the GM Board that we're going to do what's in the best interest of shareholders to create long term value and we do not see that a capital raise event is something that we need in the near term our purchase well capitalized and has strong financial support from its investors.

Jim is well funded and so there we don't really think we need to raise additional funds at this time.

We also are committed to making sure we have competitive compensation packages at cruise to attract and retain the best and the brightest talent to achieve the objectives in our our growth initiatives.

Initiatives here. So you know my my answer to be with it you know, we're always going to look and do what's in the best interest, but as we look now where in the first chapter and there's still so much that can be accomplished with a frictionless environment between cruise and GM and that's what we're really focused is getting the technology out safely and then really.

At a pace, where we can have leadership.

Understood. Thank you.

Our next question comes from the line of Dan Levy with Credit Suisse. Your line is open.

Hi, good evening, Thank you for taking the questions.

Maybe.

Perhaps a question for you Paul on the parameters of the guidance.

EBIT guidance I know you haven't articulated.

Guidance by segment Theres, some details there, but just given the comments for wholesales up 25% to 30% and you're reaffirming the 10% GM North America margin guide even after factoring in the GM has declined and the higher spend for software and crews.

I guess I'm wondering how you reconcile to having that lower half of the guidance because it seems like with that 10% North America margin guidance alone and that 25% to 30% volume growth.

Pretty easily gets you to the upper half again, so in what scenario would you get to that lower after the guide or is that just conservatism for the unknown unknowns.

Yeah, Hey, Dan Thanks for the question what I would say is this is this is very much.

Our midpoint Convention guide as we're thinking this obviously, we've expanded the range over prior years, which I think is a reflection of the volatility that we've seen.

In the place.

I'd be careful about extrapolating too much across kind of the.

Our profitability from the incremental vehicles, as we talked about and very intentional in the prepared remarks.

Lot of that incremental volume is coming in in.

At a at a lower contribution than what we've seen from a full size trucks and Suvs going forward. That's just where the capacity is for us going forward. So what I would say is with a really robust consumer and a strong continued environment, we would probably trend towards the high end of that.

But we have a lot of volatility so to the extent that we see consumer weakness, we see more supply chain pressure, we see more disruption in the global logistics platform that impacts production then we could be at the lower end of the number but we wanted to give a range that was focused around the midpoint of our expectation as well as gave some comfort and some.

Difference to the volatility that we see.

Okay.

Thank you that's helpful and then second.

Mary maybe just a question on <unk> I'd like to revisit that.

Platform independent benefits so.

We go to easy Silverado and I know you haven't unveiled the full set of specs, but.

One question was which has come up in the Investor community is that on some of the metrics.

Relative to the other competition that's out there it's not showing the type of advantage over your competitors that maybe some had anticipated. So maybe we can just zoom out.

You're launching the opium vehicles.

What are the benefits that we're going to see.

Versus your competitors' niches and he is going to be more profitable vehicles is it that is.

I'm going to show up in other areas of battery efficiency is it that just can help unlock will range that others can't Hudson.

What are the benefits of opium that we're going to start to see within the vehicle.

More or less call it metric basis.

Yeah, well, so I mean, I think when we look at what all team is providing first of all it's going to give us scale and we do think as we get the full portfolio of Altium launch, we're going to see that scale and it's going to give us an advantage from a from an overall margin perspective, but specifically for the Silverado E. V. You leveraging altium, we we have longer range 400 plus mile.

<unk> faster charging better towing capability.

And I think you have to really look at this as opposed to I know there's been some focus on the miles per kilowatt hour.

Haven't put all the the the fact that it's going to get a very with a lot of features that you choose I mean, we very carefully look to say what are we going to provide for the customer what does the customer want in this segment, what's important to them and when you look at more range faster charging more this is more capability in the real world.

Then when you look at the LTM platform also it gives us the opportunity to have a mid gate, which gives us much more flexibility.

Also being able to see drive these trucks that people are going to see the benefit of a fully integrated battery pack and body structure, which gives us a mass advantage as well as we think superior vehicle dynamics, So Oh and then you.

From an <unk> perspective, the other thing I would say as it relates to the truck portfolio, it's going to give us an opportunity to have a full truck portfolio faster.

And you know as we've seen over the last couple of years think about when we rolled out this current generation of trucks.

She went on high feature in high value and we've grown our truck share capability. So we know that truck customer theres. Some that want high value. Some that want high feature all team is going to give us the opportunity to again.

Delight, the customer with what they're specifically looking for as opposed to you know one or two point solutions off of a retrofitted platform.

Great. Thank you very much.

Our next question comes from the line of Colin Langan with Wells Fargo. Your line is now open.

Oh, great. Thanks for taking my questions.

Sorry, I hope, it's not too basic I just wanted to clarify on the cruise announcements.

People are able to sign up on the waitlist does that mean youre actually going to be able to do it soon or is it like today or is that like you're on a waitlist in a couple of months they were able to actually start taking rides or any I just want to clarify that it was just kind of felt like it might have been today and then I assume that means you have that sort of final license I think you've talked about it you need it in San Francisco to deploy.

Hi, Collin. Thanks. Thanks for the question. So the waitlist is open and based on the early demand. We saw this morning, there's going to be a pretty long list pretty quickly.

And we are starting small with a limited number of vehicles limited hours and so I don't think we're gonna be able to get to everyone on that list in the next week or two and so it could be some time before people on the waitlist get to use the product, but we are we have already started carrying members of the public and we're working through that waitlist now, adding new people every day.

The other part of your question I'm sorry.

I think I'd answer that I assume then you got that last license. So thank you very much yeah on the permit we still have five out of the six necessary permits to operated third rideshare services. So as of today all of the Reds are free and we filed the last are the application for the last remaining permit in November last year, and we continue to work with the CPUC.

California Public Utilities Commission and answer questions. They have about that application as they pop up.

So stay tuned for more news on that.

Thank you and then just I wanted to follow up on the 25 to 30 of cats. Other automakers are announcing cuts. So it's a bit surprising I mean, what kind of line of sight do you have I mean is it just that you have maybe bigger buffer stock now that you're maybe more able to swap out some of these chips.

Pivotal risky considering it seems you've been surprised.

Over the last year, the supply wasn't there and it seems like a very fragile semi pipeline it seems.

Any sort of visibility there that you can provide.

Well again as I said.

We have been working closely with our supply base with the tier ones as well as the semiconductors and we said last year that we were going to work deep into the into the tiered base and understand the capabilities.

Were hit pretty hard last last year third quarter with Malaysia.

Because it just so happened at the facilities that have a lot of GM business happened to be hard hit by Covid and you saw that the losses, we suffered there. So I think that's a bit of it but you know this.

This is our best estimate with the detailed work that we've been doing.

All last year and this year now we still get surprises and then we work to two to solve those issues either with an engineering solution or making tradeoffs between vehicles. We believe we're going to continue to do that but what we're sharing with you is you know based on everything we know today based on the commitments of the supply base and you know barring.

Major COVID-19 disruption or some maybe major national natural disasters supply chain disruption. This is what we think we're gonna be able to do.

And Collyn, if I can just add to that I think.

Excuse me understand some of the skepticism, especially based on the volatility and where others are.

Going forward, but this is why we wanted to add the point in there about where we see Q1.

We're coming off of a lower baseline in the second half of the year largely because of the impact that Mary mentioned, but the run rate that we've seen sequentially from <unk> to <unk> <unk> is giving us a heightened level of confidence that it doesn't mean that things won't pop up but certainly what we're seeing in the very very near term.

It is giving us a little bit more confidence and I think the general consensus is that.

Things will be more stable in the second half of the year than in the first half of the year. So that's kind of how we're extrapolating our expectation.

Okay. Thanks.

Okay.

Our next question comes from the line of Ryan Brinkman with Jpmorgan. Your line is open.

Hi, Thanks for all the color on 2022 outlook, including relative to both volume and pricing I'm curious for your thoughts on mix in 'twenty. Two so for example, as chip supply continues to hopefully normalize does that mean, you may produce more modestly priced or lower trim model vehicles, including for rental customers et cetera, what's the right way to think about.

How much of the much richer mix has been supply driven with automakers, including yourselves opting to produce only higher end vehicles, Enzo could maybe unwind versus how much of the much richer Mitch mix is maybe more.

<unk> demand driven for example, with consumers increasingly demanding these high end features what do you think.

Well. Thanks for the question Ryan I think we continue to see and it talks to all through 2021 about the strength of the consumer and the strength of the.

The new models, especially in the full size trucks, and Suvs and how customers were buying up for them. So.

Theres nothing thats changed underlying in the consumer from that standpoint, the comment that we've made in their prepared remarks was largely a function of the increased volume.

We were running full out on a lot of the full sized trucks and Suvs. There is some incremental production capabilities, but really a lot of the unmet.

Production or underutilized production that was a hit in 'twenty one was in the crossover smaller Suvs and sedans.

So by definition, that's where a lot of the production.

Creases and volume increases are going to be in 2022, I don't think that that changes mix, we're going to see.

To watch that with the consumer.

Going through 2022, and it's something that we can adjust.

On the fly as we see that going forward, but no reason to believe that the strength of the consumer is deteriorating from what we saw in 2021 and the only thing I would add Paul is that when you look at the new full size trucks.

With the enhancements that we've made and frankly even offerings. Some are further up level models I think that's just another huge opportunity for us. So I think this can be a positive year for for that and and again, we focused on those vehicles that we have no because we're already running full out so we have no capacity that make up.

Which kind of puts a little more color onto what Paul said about where the opportunity to add this year.

Very helpful. Thank you both and then just lastly, maybe a related follow up question on if there might be a new normal that you see in terms of U S industry sales, we used to say that normalized U S demand was around $17 million until did average around 17 million for a long time, but there was also when vehicles cost.

30, or $35000 versus another more like 40 or $45000. So just curious if you have any updated thoughts on any new normal in terms of sales and pricing et cetera.

I don't know if theres anything normal right now when you look at all of the challenges that the industry is still facing as Paul said, we think we've got a large pent up demand, especially for GM vehicles and.

And you know strong full size trucks coming out we continue to see just incredibly strong.

Demand for our full size Suvs and mid sized crossover. So I think it's too early to declare normal when we're still impacted by the semiconductor shortage, they're still buying behavior.

As an outcome of Covid and some of the stimulus.

Support that was provided so I think it's going to take a little a little while before we declare normal.

Okay very helpful. Thank you.

Our last question comes from the line of Brian Johnson with Barclays. Your line is open.

Yes, Hi team this is Steven Hempel on for Brian .

Just two questions here from from US in terms of the.

Kind of consolidated the semiconductor person three families and the co development or I guess, where do we stand on that and then what's the kind of what's the expected timeframe when that that could add too.

Incremental chip supplier.

Yeah. That's a that's a mid term type of solution clearly you know it's full speed ahead of working with the partners that we announced and you know getting to the families and so reducing complexity, which we think will allow.

Allow us to secure supply in addition to the relationships that we're creating with these strategic partners, but that's a mid term solution not a short term solution.

Okay and then.

I guess somewhat related question in terms of the long term margin targets laid out at the capital markets day, 12% to 14% margins it looks like as we.

Go into 2022, there's a decent step up in investment for some of these related businesses I guess the move out to 2030 should we be expecting a kind of a directionally linear move towards that 12% to 14% or should we be expecting some years to be kind of flattish or even potentially down as we shift out of.

I assume the buzz and bring on new businesses.

Hey, Stephen it's false what what I would say is it's a it's a little bit lumpy between now and then because if you think about the trajectory the number one.

Priority and foundation that we're building is getting the EV fleet out there.

So youre going to see a lot of the revenue growth really driven by Evs.

Over the next few years and as you get into the latter half of the decade, and you've got the <unk> Ultra five platform out there and growing that foundation through electric vehicles, you're going to start to see what we think is gonna be a pretty quick ramp up in the software. So the revenue growth is going to be a little bit more steady, especially.

As we look at what cruise is doing going forward.

The margin performance is probably lags a little bit because of some of the higher margin revenue opportunities from software and connected vehicles.

We are going to be are going to come after we get that foundation built in the latter part of the decade.

Okay understood. Thanks for taking our questions.

Yes.

Thank you I'd now like to turn the call over to Mary Barra for her closing comments.

Thanks, Jordan and thanks, everybody for your questions.

Donna.

Close again by thanking the G M team.

<unk>, including the G. M F team, our Union partners, our dealers and our suppliers you know the work that they did together seizing opportunities addressing challenges is what allowed us to have this record performance and we take that collaboration and problem solving agility and resiliency into 2022, and we apply that to.

Continuing to accelerate our transformation the work in software and of course supporting our crews.

Our company as well so I couldn't be more excited about 2022, and what the year and how it can unfold I hope you see and you see the clear sense of determination that we have and we will move even faster to deliver on our commitments and achieve the growth that we know is right in front of us so.

I want to assure you that we'll keep you updated every step of the way, but 'twenty two is going to be an exciting year.

Thank you.

Okay.

That concludes the conference call for today, Thank you for joining us.

Okay.

[music].

All of them see pad to withdraw your question Press Star two as a reminder, this conference call is being recorded Tuesday February 1st 2022, I would now like to turn the conference over to Rocky Gupta, Treasurer, and Vice President of Investor Relations.

Thanks, Jordan good afternoon, and thank you for joining us as we review Gm's financial results for the fourth quarter and calendar year 2021.

Our conference call materials were issued earlier this afternoon.

They are available on the GM Investor Relations website. We're also broadcasting this call via webcast.

I'm joined today by Gms Chair and CEO , Mary Barra, Gm's CFO , Paul Jacobson, GM financial CEO , Dan birth, and cruise cofounder Kyle Voigt Carla.

Kyle will be available to speak about cruise is exciting progress in the Q&A portion of the call.

Before we begin I would like to direct your attention to the forward looking statements on the first page of the charts that the content of our call will be governed by this language will now turn the call over to Mary.

Hey, Thanks, Rocky and good afternoon, everyone and thanks for joining us.

Before we get into our 2021 results in 2022 outlook I want to start with some exciting news from cruise, which is whenever most significant growth opportunities.

Dan can Gil west in the entire cruise team are doing great work and they just delivered a key milestone and the drive to commercialization to commercialize cruise Rideshare service.

As Carla shared crews team members had been taking fully driverless rides in San Francisco since November to demonstrate and refine the software and hardware ecosystem. We have created together in fact, they have logged over 20000 miles and completed more than 600 trip IRA.

Speaker 3: I rode in a driverless cruise a couple weeks ago, and I can tell you, it was the highlight of my career as an engineer and as the leader of General Motors. The ride is smooth and confident. It's like having an experienced and attentive driver behind the wheel.

I wrote in a driverless crews a couple of weeks ago and I can tell you. It was the highlight of my career as an engineer and as the leader of General Motors. The ride is smooth and confident it's like having an experience and a ton of driver behind the wheel.

Speaker 3: Now, as CRUISE announced this morning, it is inviting members of the public to sign up for their own driverless rides through a wait list on the CRUISE website. This is the first truly driverless ride hail service offered to members of the public in a dense urban environment. To maximize its learnings, CRUISE will prioritize use cases that are on natural fits for autonomous ride sharing.

Now as crews announced this morning. It is invited members of the public to sign up for their own driverless rides through a waitlist on the cruise website.

Speaker 3: This major milestone brings Cruise even closer to offering its first paid rides and generating $50 billion in annual revenue by the end of the decade.

This major milestone brings crews even closer to operate its first paid rides and generating $50 billion in annual revenue by the end of the decade.

Speaker 3: It also means that the SoftBank Vision Fund will invest, as planned, another $1.35 billion in Cruise. This is another strong vote of confidence in the Cruise team, its technology, and the services it's creating. Additionally, Cruise continues to advance the strong relationship it has established with Walmart, where the team is making progress on driverless deliveries of groceries to customers every day.

It also means that the Softbank vision fund will invest as plan another $135 billion in crews. This is another strong vote of confidence in the cruise team its technology and the services. It's creating additionally cruise continues to advance the strong relationship. It has established with Walmart where the team is making progress on.

Driverless deliveries of groceries to customers every day.

Speaker 3: With this incremental investment and the investments from General Motors and companies like Honda, Microsoft, and Walmart, Cruise is very well capitalized to scale its business when the origin production comes online at factory zero late this year. So, Kyle, congrats.

With this incremental investment and the investments from general Motors in companies like Honda, Microsoft and Walmart cruise is very well capitalized to scale its business when the Oregon production comes online at factory zero late this year, so Kyle congrats.

Speaker 3: Now, I want to turn to the significant investments we are making to expand both our battery cell and EV assembly capacity.

Now I want to turn to the significant investments, we are making to expand both our battery cell and EV Assembly capacity.

Speaker 3: We believe our strategy to scale a common Ultium cell, component set, and platform will create significant long-term value for all GM stakeholders. We also recognize that we need to launch more EVs faster, so that's exactly what we are going to do.

We believe our strategy to scale, our common altium cell components set and platform will create significant long term value for all G. M. Stakeholders. We also recognize that we need to launch more evs faster. So that's exactly what we're going to do.

Speaker 3: As you know, the GMC Hummer EV is already in the market. Cadillac Lyric deliveries begin in less than 60 days. An additional bright drop EV 600 production begins at CAMI late this year, where we'll launch with an annual capacity of 30,000 units and the ability to nearly double production by mid-decade. The Chevrolet Silverado EV launches next spring, and the Chevrolet Equinox and Blazer EVs will also reach the market in 2023.

The Chevrolet Silverado EV launches next spring and the Chevrolet Equinox and Blazer Evs will also reach the market in 2023.

Speaker 3: As you know, we have also announced additional battery cell and assembly capacity investments in Michigan that will give us more than one million units of EV capacity in North America by the end of 2025, and this includes 600,000 full-size trucks.

As you know we have also announced additional battery cell and assembly capacity investments in Michigan that will give us more than 1 million units habibi capacity in North America by the end of 2025 and this includes 600000 full sized truck.

Speaker 3: This is in addition to more than one million units of EV capacity in China over the same time frame. And I can tell you right now, one million units in North America won't be enough to meet the steep inflection and demand that we expect starting mid-decade for our EVs. That's why we will continue to convert ICE capacity to EVs and plan to invest in a third EV truck plant.

Planned to invest in a third EV truck plant.

Speaker 3: We are formulating plans for the truck plant right now and we will share more as we work through the details.

Are formulating plans for the truck plant right now and we'll share more as we worked through the details.

Speaker 3: Importantly, battery cells will not be a constraint to our long-term EV growth. Our Ultium cell JVs in Ohio and Tennessee come online in 2022 and 2023, respectively, and we will add capacity as demand grows. Our Ohio plant will launch with seven-day operations, adding 10% capacity and 200 jobs. Cell production in Michigan is scheduled to begin in late 2024.

Importantly, battery cells will not be a constraint to our long term EBIT growth or altium cell Jv's in Ohio, and Tennessee come online in 2022, and 2023, respectively, and we will add capacity as demand grows our Ohio plant will watch with seven day operations, adding 10% capacity and 200.

<unk> cell production in Michigan is scheduled to begin in late 2024.

Speaker 3: And I'm sharing today that we will announce the location of our fourth U.S. cell plant in the first half of this year.

Speaker 3: Together, these plants will support GM's EV volume growth and supply our customers in the rail, trucking, aerospace, and marine industries.

Speaker 3: Equally important for our EV strategy for North America is that it is backed by a strong, more sustainable North American-focused supply chain that includes lithium, rare earth material, permanent magnets, cathode active material, silicon carbide, motor stators, and more. To deliver this acceleration, we are pulling ahead significant investment into the 2022-2025 timeframe, and we will share more details as we further refine our plan.

[noise] ahead significant investment into the 2022 to 2025 timeframe and we will share more details as we further refine our plans.

Speaker 3: Growing customer demand for the first wave of Ultium products strongly supports these investments.

Speaker 3: We already have more than 59,000 reservations for the GMC Hummer EV pickup and SUV.

Speaker 3: Not surprisingly, some of the first owners are very prominent figures in the sports and entertainment industries, and their initial feedback has been just incredible. They expected a super truck, and they got one.

Incredible they expected a super truck and they got one.

Speaker 3: Our next electric pickup will be the Chevrolet Silverado EV. More than 110,000 Silverado EVs are reserved so far, including reservations from more than 240 fleet operators, and the numbers keep growing every day.

Speaker 3: Some of the world's largest fleet customers, including FedEx, Verizon, Merchants Fleet, and Walmart, are adopting Bright Drop vehicles and their technology. All told, we have more than 25,000 production reservations for Bright Drop cargo vans. And customer interest in the Cadillac Lyric is growing so quickly that we'll forgo a new round of reservations and begin taking customer orders soon after the debut edition launches in March.

Customer interest and the Cadillac lyric is growing so quickly that will forgo a new round of reservation reservations and began taking customer orders soon after they do they do.

<unk> edition watches in March one of our most highly anticipated rebuilds. This year will be the Chevrolet Equinox, EV, which we previewed in January the verge named it the best electric car of CES, saying, there's a perception that electric vehicles are luxury items that when general Motors said, the equinox would come with a $30000.

Speaker 3: One of our most highly anticipated reveals this year will be the Chevrolet Equinox EB, which we previewed in January . The Verge named it the best electric car of CES, saying, there's a perception that electric vehicles are luxury items, so when General Motors said the Equinox would come with a $30,000 sticker price, it's something worth noting.

Sticker price, it's something worth noting.

Speaker 3: The efficiencies created by the Altium platform are a key reason why we will be able to deliver truly affordable EVs like the Equinox.

The efficiencies created by the Altium platform or a creek key reason why we will be able to deliver truly affordable evs like the equinox affair.

Speaker 3: Affordable EVs are part of the market that start-ups aren't targeting, but they are key to driving mass adoption of EVs, which is a national and a global priority. That's why we plan to follow the Equinox with an even more affordable EV.

Affordable Evs are part of the market that startups aren't targeting but they are key to driving mass adoption of Evs, which is a national and a global priority.

That's why we plan to follow the equinox with an even more affordable EV.

Speaker 3: Now let's shift and talk a little bit about our other GM growth platforms. Throughout the year, you will see the expansion of advanced vehicle technologies, new shopping tools, and continued progress at our new business startups. This spring, we will launch redesigns of the Chevrolet Silverado and the GMC Sierra 1500 pickups and offer them with Super Cruise with expanded capabilities that include lane change on demand and hands-free trailering. These are first for the segment.

Now, let's shift and talk a little bit about our other GM growth platforms throughout the year, you will see the expansion of advanced vehicle technologies, New shopping tools and continued progress at our new business startups. This spring, we will launch redesigns of the Chevrolet Silverado and GMC, Sierra 500, pickups and offer them with Super.

Cruise with expanded capabilities that include lane change on demand and hands free trailing these are first for the segment.

And the same timeframe GM and our dealers will begin marketing car Bravo, our new used vehicles shopping service. This is truly a win win our dealers will grow their business by offering customers online access to far more inventory that other services in turn we expect to drive incremental GM and GM financial revenue by selling products.

Speaker 3: In turn, we expect to drive incremental GM and GM financial revenue by selling products like on-star insurance, on-star connected services, accessories, and financial services. It will also help support strong residual values for off-least VMS.

Like Onstar insurance Onstar connected services accessories in financial services. It will also help support strong residual values for off lease vehicles.

And then next year it will rollout Ultrafine, a new end to end software platform for Evs Avs and ice vehicles that will have even more sweeping over the air capabilities than we have today. This includes the ability to back half features to the Cadillac lyric also probably will be the foundation for new GM developed and approved third party apps in cars.

Subscriptions and other connected services that enhance the customer experience and expand our revenue through the life of each vehicle.

Speaker 3: Paul will share more details on our results and guidance in his remarks, but before I turn the call over to him, I would like to discuss our capital allocation strategy.

Paul will share more details on our results and guidance in his remarks, but before I turn the call over to him I would like to discuss our capital allocation strategy.

Speaker 3: The prospect of continued strong earnings and free cash flow, even as we invest for growth, naturally raises questions about resuming a common stock dividend. As we move forward, we will consider all opportunities to return excess capital to shareholders, but we will not reinstate a dividend at this time.

Speaker 3: Our clear priority is to accelerate our EB plan and drive growth, and we want to maintain maximum flexibility to invest as opportunities arise across our growth platforms, including many of the accelerated plans I've outlined today.

Our clear priority is to accelerate our E V plan and drive growth and we want to maintain maximum flexibility to invest as opportunities arise across our growth platforms, including many of the accelerated plans I've outlined today.

Speaker 3: I think we've consistently demonstrated that we're a team that delivers on our commitments. That's more important now than ever with the incredible opportunities in front of us. So now I'm going to turn the call over to Paul who will walk us through the quarter and our outlook. Then Paul, Dan Burris, Cal Vote, and I will take your questions.

I think we've consistently demonstrated that we're a team that delivers on our commitments.

That's more important now than ever with the incredible opportunities in front of us. So now I'm going to turn the call over to Paul who will walk us through the quarter and our outlook then Paul dam burst Cal vote, and I will take your questions.

Speaker 4: Thank you, Mary, and good afternoon, everyone. We sincerely appreciate you taking the time to join us.

Thank you Mary and good afternoon, everyone. We sincerely appreciate your taking the time to join us.

Speaker 4: As Mary mentioned, the strong results last year, including record full-year EBIT adjusted and EBIT adjusted margins, are a reflection of the hard work and execution from our team and the underlying strength of our business.

Mary mentioned, the strong results last year, including record full year EBIT adjusted and EBIT adjusted margins are a reflection of the hard work and execution from our team and the underlying strength of our business, we're seeing strong demand for our products, especially our trucks and Suvs and we are striving again this year to produce as many of them.

Speaker 4: We're seeing strong demand for our products, especially our trucks and SUVs, and we are striving again this year to produce as many of them as we can. I want to thank the entire GM team once more for the execution during this past year.

As we can I want to thank the entire GM team once more for the execution during this past year.

Speaker 4: The cash that we generate today is funding the transformation of GM in pursuit of the growth strategy we shared last year in our investment.

The cash that we generate today is funding the transformation of GM in pursuit of the growth strategy, we shared last year at our Investor day, we.

Speaker 4: We see a path to doubling revenue by 2030 while expanding margins with significant opportunities in software, services, and new businesses in electric and autonomous vehicles. Now,

We see a path to doubling revenue by 2030, while expanding margins with significant opportunities in software services, and new businesses and electric and autonomous vehicles.

Now, let's get into the results.

Speaker 4: While we face the well-publicized global semiconductor challenges and continued pressure from COVID protocols throughout the world, the GM team once again delivered tremendous results in 2021 through our production prioritization and work across our value chain.

While we faced the well publicized global semiconductor challenges and continued pressure from Covid protocols throughout the world. The GMT once again delivered tremendous results in 2021 through our production prioritization and work across our value chain.

Speaker 4: For the full year, we generated 127 billion dollars in revenue, 14.3 billion dollars in EBIT adjusted, 11.3% EBIT adjusted margin, $7.7 in EPS diluted adjusted, and $2.6 billion dollars in the adjusted automotive free cash.

For the full year, we generated $127 billion in revenue $14 $3 billion in EBIT adjusted of 11, 3% EBIT adjusted margin $7 seven in EPS diluted adjusted and $2 6 billion and adjusted automotive free cash flow.

Speaker 4: In the fourth quarter, we generated $34 billion in revenue, $2.8 billion in EBIT adjusted, 8.5% EBIT adjusted margin, $1.35 an EPS diluted adjusted, and $6.4 billion in adjusted automotive free cash.

Speaker 4: Pre-cash flow in the quarter was largely driven by working capital rewind as we were able to complete and wholesale over 80,000 vehicles that had previously been built without certain components as well as dividends from GM financing.

Free cash flow in the quarter was largely driven by working capital Rewind as we were able to complete in wholesale over 80000 vehicles that had previously been built without certain components as well as dividends from GM financial.

Speaker 4: We saw improved semiconductor availability in the fourth quarter compared to the third quarter, which enabled us to increase our wholesale sequentially while substantially reducing our inventory of vehicles built without certain components. And we expect ongoing semiconductor availability improvements throughout 2020.

Speaker 4: We also realize strong price and mixed performance in North America through our production prioritization actions and our go-to-market strategy.

We also realized strong price and mix performance in North America through our production prioritization actions and our go to market strategy.

Speaker 4: Additionally, used vehicle prices and strong credit performance continue to drive record results at GM.

Additionally, used vehicle prices and strong credit performance continued to drive record results at GM financial.

Speaker 4: Let's take a closer look at North America. In Q4, GM North America delivered even adjusted of $2.2 billion as we continued to see robust customer demand for our products and tight dealer inventory, driving strong transaction.

Let's take a closer look at North America in.

In Q4, GM North America delivered EBIT adjusted of $2 $2 billion as we continued to see robust customer demand for our products and tight dealer inventory driving strong transaction prices.

Speaker 4: These results were somewhat better than our December updated guidance expectations as we saw continued volume and cost improvement.

These results were somewhat better than our December updated guidance expectations as we saw continued volume and cost improvements on.

Speaker 4: On a year over year basis in the fourth quarter, we saw volume decreases and increased investments in growth, partially offset by pricing and...

On a year over year basis in the fourth quarter, we saw volume decreases and increased investments in growth, partially offset by pricing and mix.

Speaker 4: US dealer inventories ended the year at around 200,000 units of which only approximately 25% is grounded stock, resulting in continued high sales turns of around 10 days.

U S dealer inventories ended the year at around 200000 units of which only approximately 25% is grounded stock resulting in continued high sales turns of around 10 days.

Speaker 4: Moving to GM International, in the fourth quarter, GMI EBIT adjusted was approximately $0.3 billion, relatively flat year over year.

Moving to GM international in the fourth quarter GMI EBIT adjusted was approximately zero point $3 billion.

Relatively flat year over year.

Speaker 4: China equity income was $0.2 billion in the quarter with continued strong mix, stabilization and pricing and material cost performance offset by semiconductor and commodity.

China equity income was <unk> $2 billion in the quarter with continued strong mix stabilization in pricing and material cost performance offset by semiconductor and commodity impact.

Speaker 4: As we reference last quarter, our international business outside of China has made substantial progress on our past and sustainable profitability. GMI EBITHS just did excluding China equity income achieve profitability in the fourth quarter, despite continued semiconductor pressure. And the Chevrolet brand has regained its retail market share leadership in South America.

Market share leadership in South America.

Speaker 4: A few comments on GM Financial and the Court's segment. GM Financial concluded another extremely strong year with Q4, EBT adjusted of $1.2 billion with record full year EBT adjusted of $5 billion. GM Financial paid an additional $1.7 billion dividend in Q4. That brings a total GM Financial dividends to $3.5 billion in 2021. Equivalent to how much we paid for the company.

A few comments on GM financial in the Corp segment.

That brings the total GM financial dividend to $3 $5 billion in 2021 equivalent to how much we paid for the company.

Speaker 4: Going forward, we expect GM financial dividends to moderate as earnings normalize, and we continue to grow the asset.

Going forward, we expect GM financial dividends to moderate as earnings normalize and we continue to grow the asset base.

Speaker 4: Corp EBIT adjusted in Q4 was down year over year by about half a billion dollars driven by the non-recurrence of market-market gains recognized in Q4 2020.

Corp, EBIT adjusted in Q4 was down year over year by about half a billion dollars driven by the non recurrence of mark to market gains recognized in Q4 2020.

Speaker 4: Now turning to our outlook for 2022, today we see a stabilizing semiconductor environment and envision wholesales getting to a normalized run rate towards the beginning of the third quarter with a target of around 800,000 units in North America on a quarterly basis.

Now turning to our outlook for 2022 today.

Today, we see a stabilizing semiconductor environment and envision wholesales getting to a normalized run rate towards the beginning of the third quarter with a target of around 800000 units in North America on a quarterly basis, we expect total company volume to increase 25% to 30% year over year with the majority of the increase occurring in.

Speaker 4: We expect total company volume to increase 25 to 30% year over year with a majority of the increase occurring in the second half of the year primarily due to the production constraints in the second half of 2021.

The second half of the year, primarily due to the production constraints in the second half of 2021 sequentially.

Speaker 4: Sequentially, we expect the positive trend to continue with Q1 wholesale volumes up 20 to 25% versus Q4 2021.

Sequentially, we expect the positive trend to continue with Q1 wholesale volumes up 20% to 25% versus Q4 2021.

Speaker 4: In 2022, we anticipate light industry sales of approximately 16 million units. Viewers stock to remain tight and the dynamic where production is the gating factor for sales volumes continuing into 2020.

Speaker 4: As you think about the mix of this incremental volume, remember that in 2021, we largely protected our high-demand truck production. As a result, the incremental volume in 2022 will be mostly weighted towards small and midsize SUVs and sedans.

As you think about the mix of this incremental volume remember that in 2021, we largely protected our high demand truck production as a result, the incremental volume in 2022 will be mostly weighted towards small and midsized Suvs and sedans.

Speaker 4: Now let's turn to our expectations for growth investments in March.

Now, let's turn to our expectations for growth investments and margin.

Speaker 4: We're at a very important stage in the growth and development of some of our key businesses, and we are taking the very intentional step of investing heavily into them to accelerate our expansion.

We're in a very important stage in the growth and development of some of our key businesses and we are taking the very intentional steps of investing heavily into them to accelerate our expansion.

Speaker 4: Cruise expenses are expected to increase as they rapidly approach commercialization and hire around 500 additional employees, increasing their workforce by around 20% to advance technology as well as accelerate the operational infrastructure to grow and expand. We also expect to see some wage rate pressures we continue to attract top talent to the

<unk> expenses are expected to increase as they rapidly approach commercialization and higher around 500 additional employees, increasing their workforce by around 20% to advanced technology as.

As well as accelerate the operational infrastructure to grow and expand we also expect to see some wage rate pressures, we continue to attract top talent to the company.

Speaker 4: Corporate expenses are expected to increase by approximately $0.5 billion as we expand the bright drop business, excuse me, including product development and manufacturing spend to prepare the CAMI facility for ELCV production later in the year and expanding customer pilots for the EP1 electric cart, which we expect will drive software and services recurring revenue opportunities.

Which we expect will drive software and services recurring revenue opportunities.

Speaker 4: We're to continue to roll out on-star insurance across the country. We're in 46 states today and expect to be in all 50 by the second quarter. We're to develop new products at GM Defense and continue to incubate new ideas to drive incremental growth and value in...

We're to continue to rollout onstar insurance across the country. We're in 46 states today and expect to be in all 50 by the second quarter.

To develop new products at GM defense and continue to incubate new ideas to drive incremental growth and value in the future.

Speaker 4: We're also expecting to invest another $1.5 billion in expenses to expand software development and further accelerate our EV portfolio, which includes close to $1 billion of incremental engineering and software related development.

Speaker 4: These investments are building the foundation to grow and accelerate our AV, EV, and software businesses as we aggressively launch approximately 20 EV products in North America and more than 30 EV products globally through 2025 and introduce ultimatums.

These investments are building the foundation to grow and accelerate our Avi EV and software businesses as we aggressively launch approximately 20 EV products in North America, and more than 30, EV products globally through 2025 and introduce ultra fine.

Speaker 4: These investments will also drive meaningful revenue growth starting in 2023, initially from EVs, bright drop in crews, but expanding the software and services as we launch, ultify, and grow other new business opportunities such as on-star insurance and GM defect in the next few years.

These investments will also drive meaningful revenue growth starting in 2023, initially from Evs bright dropping crews, but expanding the software and services as we launch <unk> and grow other new business opportunities such as Onstar insurance and GM defects in the next few years.

Speaker 4: We're now also expecting commodities and logistics cost pressure of $2.5 billion year over year, primarily weighted to the front half of 2000.

We're now also expecting commodities and logistics cost pressure of two $5 billion year over year, primarily weighted to the front half of 2022.

Speaker 4: From a non-operating perspective, we expect to combine $1 billion year-over-year headwind from the non-recurrence of market-market gains we achieved in 2021 and a reduction in net pension income as we further de-risk the plan after.

Speaker 4: I want to reiterate that despite all of this, we expect to generate 10% North America even adjusted margins in 2022, inclusive of the increased expenditures related to our growth investment and highlighting our ability to fund these initiatives through internally generated cash.

Speaker 4: In China, we expect equity income from our joint ventures to exceed $1 billion and remain relatively flat year over year. We anticipate a modest increase in volume, which will be all set by a more normalized mix. Competitive pricing environment and increased investments as we prepare to bring more EV products to market.

Speaker 4: We expect GM financial performance to be in the three and a half to four billion dollar range. As we do not expect a repeat of some of the 2021 allowance releases, and we anticipate that credit performance and use vehicle prices will begin to moderate.

Speaker 4: Assuming continued steady demand for new vehicles, no significant new economic or supply chain challenges in 2022, we expect even adjusted in the $13 to $15 billion range. EPS diluted adjusted in the $6.25 to $7.25 range, and adjusted automotive free cash flow in the $7.9 billion range.

Assuming continued steady demand for new vehicles, no significant new economic or supply chain challenges in 2022, we expect EBIT adjusted in the 13% to $15 billion range.

Diluted adjusted in the $6 25.

725 range and adjusted automotive free cash flow in the 7% to $9 billion right.

Speaker 4: Adjusted on automotive free cash flow will be driven by strong earnings and working capital rewind as volumes increase. We expect capital to be in the 9 to 10 billion dollar range in 2022, including investments in our Altium battery cell JVs and expect similar levels of spending over the next several years.

Adjusted automotive free cash flow will be driven by strong earnings and working capital Rewind as volumes increase we expect capital spend to be in the 9% to $10 billion range in 2022, including investments in our also Altium battery cell JV and expect similar levels of spending over the next several years.

Speaker 4: In summary, we had a strong finish to the year and our results are a reflection of the team's focus and execution in the face of a continued challenging environment.

In summary, we had a strong finish to the year and our results are a reflection of the team's focus and execution in the face of a continued challenging environment.

Speaker 4: In 2022, we expect strong commercial performance, and we are aggressively reinvesting some of our short-term eBIT improvement to accelerate our EVAV journey while still driving similar results to our record performance in 2021. This demonstrates the strength of our underlying business, the strength of our truck and SUV franchises, our industry leading customer loyalty, and world-class manufacturing and design capability.

In 2022, we expect strong commercial performance and we are aggressively reinvesting some of our short term EBIT improvement to accelerate our EV AAV journey, while still driving similar results to our record performance in 2021.

Speaker 4: We will continue to leverage these competitive advantages as we vastly expand our battery cell and EV assembly capacity in North America to lead the INS.

Industry.

Speaker 4: This concludes our opening comment and will now move to the Q&A portion of the call.

This concludes our opening comments and we'll now move to the Q&A portion of the call.

Speaker 5: A reminder to analysts, we are asking to limit yourself to one question and a brief follow-up so that they may get everyone on the call. Our first question comes...

A reminder to analysts we are asking to limit yourself to one question and a brief follow up so that they may get to have everyone on the call.

First question comes from the line of Rod Lache with Wolfe Research. Your line is open.

Speaker 6: Hi everybody, congratulations on these results and the outlook. I'll ask two questions. First, just financial one for Mary and Paul. You guys have almost 22 billion of cash. Your US pensions now about fully funded. You've got 40 billion of liquidity and...

Hi, everybody.

Congratulations on these results and the outlook.

I'll ask two questions first just financial one for Mary and Paul you guys have almost 22 billion of cash.

Your U S pensions now about fully funded you've got $40 billion of liquidity.

Speaker 6: We've shown a lot of resiliency in different financial conditions and operating conditions and are talking about $79 billion of free cash next year. So that's going to lead to some speculation on where these investments could be that you're contemplating instead of cash returns. So can you maybe talk about are there investments that you're thinking about that are large enough that would consume cash of that magnitude?

We've shown a lot of resiliency in different financial conditions, and operating conditions and are talking about $7 billion to $9 billion of free cash next year. So that's going to lead to some speculation on where the these investments could be that.

Youre contemplating instead of.

Cash returns. So can you maybe talk about or are there investments that youre thinking about that are large enough that would consume cash of that magnitude.

Speaker 3: So, Rod, hey, thanks for the question. And as we look at it, we're going to follow the capital allocation framework that we're going to continue to invest in opportunities that allow us to...

So rod thanks for the question and you know as we look at it we're going to follow the capital allocation framework that we're going to continue to invest in opportunities that allow us to generate returns our return on invested capital of greater than 20% maintain an investment grade balance sheet, and then return the balance to shareholders.

Speaker 3: generate returns, return on invested capital of greater than 20 percent, maintain an investment grade balance sheet, and then return the balance to shareholders. You know, we talked about a lot of, you know, pull ahead and acceleration to our EB strategy.

We talked about a lot of it.

Pull ahead and acceleration to our EV strategy and as we work through that we will fall follow that we'll look for those good investments and then we'll follow the capital allocation framework. So thinking J R. In February it's a little early to look at that but we'll provide more guidance through the year on that.

Speaker 3: And, you know, as we work through that, we will follow that. We'll look for those good investments and then we'll follow the capital allocation framework. So, I think in February , it's a little early to look at that, but we'll provide more guidance through the year on that.

Speaker 6: I was hoping to ask a question of Kyle. You're currently, congratulations, by the way, on the milestones that you've achieved. These operations look pretty impressive. Can you talk a little bit about what the operations look like in prime time, so during the day, more congested periods?

Okay.

I was hoping to ask a question of Kyle.

Youre currently.

Gratulation is by the way on the milestones that you've achieved.

These these operations look pretty impressive can you talk a little bit about what the operations look like in prime time, so during the day more congested periods.

Speaker 6: You know, 2021 seems like it's kind of a step between R&D and commercialization. Can you maybe give us a little bit more of a sense of what commercial scale will look like and what kind of pace of expansion we should be thinking about. At one point, you were talking about, I think, a new city every six months, something along those lines, but any update on that.

Speaker 7: Hi, Rod. Thanks for the question. Yeah, it has been a very eventful day for us, and they're really good 2021 as we enter really commercialization. You know, our approach to bringing driverless cars.

Hi, Rod Thanks for the question Yeah. It has been a very eventful day for us in a really good 2021 as we enter early commercialization.

Our approach to bringing driverless cars too dense urban environments has been a cautious and careful one.

Speaker 7: dense urban environments has been a cautious and careful one. You know, we're starting with limited hours of the day, limited geofence, and what we're looking to do is confirm that the performance and functionality of our system matches the chance we celebrate time!

<unk> with limited hours of the day and limited Geofence and what we're looking to do is confirm that the performance and functionality of our system matches expectations and also that we give the communities, where we're operating a little bit of time to acclimate, especially San Francisco, which is the first one first dense urban environment that's ever experienced this so.

Speaker 7: And also that we give the community is where we're operating a little bit of time to acclimate, especially, you know, Stanford.

Speaker 7: the first one, first in urban environment that's ever experienced this. So we're going fully and cautiously, but as we see things click in evidence that performance is meaning expectations, the focus becomes exactly what you...

We're going slowly and cautiously, but as we see things click and evidence that.

Performance is meeting expectations. The focus becomes exactly what you mentioned, which is how quickly can we expand this to cover a.

Speaker 7: how quickly can we expand this to cover larger service area, more hours, serve more customers in San Francisco, but then cities beyond that. So we've been developing the foundational technology.

Our largest service area more hours served more customers in San Francisco, but then beyond that and so we've been <unk>.

<unk> the foundational technologies.

Speaker 7: do those expansions in the background, and we've learned a lot by our operation in other cities like Arizona, or sorry, in Arizona and in Michigan, so we have a pretty good idea of what's around the corner, but we're gated by safety and we're just at the very early days, so it's hard to know our exact rate of expansion.

Do those expansions in the background and we've learned a lot by our operation in other cities like Arizona.

Sorry in Arizona and in Michigan.

So we have a pretty good idea of what's around the corner, but we're gated by safety and we're just at the very early days. So it's hard to know our exact rate of expansion.

Okay. Thank you.

Speaker 5: Our next question comes from the line of John Murphy from Think of America.

Our next question comes from the line of John Murphy from Bank of America. Your line is open.

Speaker 8: All right. Good afternoon, everybody. A first question is just on the core business. When we think about the 25 to 30 percent increase in wholesale, and I would imagine that mimics production. I'm just curious, as you think about that,

All right good afternoon everybody.

First question just on.

On the on the core business and when we think about the 25% to 30% increase in wholesale.

Imagine that mimics production I'm, just curious as you think about that.

Speaker 8: In the context of a 16 million units star, it seems like there will be some inventory build, but not a lot. So if you wind up together with carburetbo, it does seem like you're pushing...

In the context of a 16 million unit Saar it seems like there'll be some inventory build.

Not not not a lot. So if you wind up together with carb Bravo. It does seem like you are pushing to keep Aep's high it makes relatively high and maybe transition some of your entry level buyers were entry level product into the used car market, which supports reserves more structurally going forward. It just seems like youre getting a very good circular.

Speaker 8: key BACPs high, mixed relatively high, and maybe transition some of your entry level buyers, or entry level product into the used car market, which supports resist more structurally going forward. It just seems like you're getting a very good circular reference, keeping it lid on inventory, whining up the car bravo. What is the real opportunity here on car bravo, and then ultimately, what could it mean for this...

Keeping a lid on inventory and then winding it up with Carb Bravo I mean, what is the real opportunity here when car Bravo and then ultimately what could it mean for sort of this inventory.

Speaker 8: You know, inventory management on the new vehicle side just seems like it's a very intertwined, very positive story. Yeah, hey, John , good afternoon.

Inventory management on the new vehicle side. It just seems like it's a very intertwined very positive story.

Yeah, Hey, John Good afternoon, and thanks for the question.

Speaker 4: You know, what I would say that for 2022, it's largely more of a function of what we continue to believe is large pent-up demand.

Speaker 4: for new vehicles that hasn't been met in 2021.

Speaker 4: because of some of the production challenges. Certainly what we saw as we were able to complete those vehicles, there was a little bit more going through the system.

There was a little bit more going through the system of production and and as we've talked about in the prepared remarks those vehicles continue to sell very very rapidly. So despite the production increases we saw in Q4.

Speaker 4: of production, and as we talked about in the prepared remarks, those vehicles continue to sell very, very rapidly. So despite the production increases we saw in Q4, we're still not really building inventory that much, and I think that's going to probably continue throughout the year with largely showing up in transit rather than on lots.

Still not really building inventory that much and I think that's going to probably continue throughout the year with largely showing up in transit rather than on lots.

Speaker 4: That's really on the consumer and I think that's the short term.

Speaker 4: When you think about CarBravo, I would think about it in terms of the volume and the access to inventory that we have through GM Financial, through the dealer network. It really is unprecedented level that gives customers much, much better choice and variety across the country. And we can do this in a coordinated fashion, largely because of where we are with vehicles coming off lease.

Speaker 4: the GM Financial Inventory is across the board. So we actually see this as a really, really strong opportunity in and of itself.

Speaker 4: to expand the customer relationship and the entire sort of universe of the customer that we're working through and we talked about it in thus.

Universe of the customer that that we're working through and we talked about at Investor day.

Speaker 8: Okay, and then just to follow up on that, I mean, things that you're tightening up and growing the core to drive more profits, the fund the future, you know, this cruise news today, you know, and I'll sort of add, make the regulations too, on that to everybody on the team. You know,

Okay, and then just to follow up on that I mean, it seems that youre tightening up and growing the core to drive more profits to fund the future.

This cruise news today.

Just sort of add my congratulations too on that to everybody on the team.

Speaker 8: As you grow in San Francisco and then repopulate the strategy in other markets.

As you grow in San Francisco, and then repopulate the strategy in other markets I mean, how do we think about the fleet and the capital required there to kind of follow up on Rob's question. If he could there be a huge call on capital. So you could actually have very good returns and what is the earnings potential in that $50 billion I got I mentioned the margin is.

Speaker 8: I mean, how do we think about the fleet and the capital required there to kind of follow up on Rod's question? I mean, could there be a huge call on capital that could actually have very good returns? And what is the earnings potential in that fifty billion dollars? I got to mention the margin is much higher than.

Speaker 8: the core business is 10%. So I mean, how should we think about those areas?

<unk> higher than the core business at 10%. So I mean, how should we think about those earnings.

Speaker 8: in 2030. So capital requirement, you know, where you own the fleet and where the earnings go.

In 2030, so capital requirement, we own the fleet, where the earnings go.

Speaker 4: Yeah, keep in mind, John , that, you know, we announced last year that GM Financial has committed to a $5 billion line of credit to help finance the origins. So I think when we look at capital for expansion, as well as for the continued development, we're not seeing any constraints in that at all. Cruz is very well capitalized. They're very well prepared for the expansion phase as they continue to roll this out and achieve their milestones.

Yes keep in mind, John that we announced last year that GM financial has committed.

Committed to a $5 billion line of credit to help finance the origin. So I think when we look at capital for expansion as well as for the continued development, we're not seeing any constraints in that at all.

<unk> is very well capitalized they're very well prepared.

For the expansion phase as they continue to roll this out and achieve their milestone.

Speaker 8: I'm sorry, and the profitability potential on this, I mean, it just seems like 10%, $5 billion is just an opening bit. It's probably a tremendous amount higher than that. I mean, what do you roughly think can run rate, all potential profitability?

I'm sorry in the profitability potential on this I mean, it just seems like.

10% $5 billion is just that.

And opening bid, it's probably a tremendous amount higher than that I mean, what are you roughly say good run rate.

Profitability.

Speaker 3: Hey, John , I think, you know, as we look, we see there's a huge first mover opportunity to go and, you know, provide an exceptional customer experience. And so, you know, we're going to – we do think there's tremendous margin potential in this business, but we also think growth is really important. So you'll see us balance that in the early days to really get a foothold, a solid foothold in a leadership position. So, you know, down the road, we see tremendous profit, but we're going to really – we're going to scale fast. It seems like a huge opportunity.

Hey, John I think as we look we see there's a huge first mover opportunity to go and provide an exceptional customer experience and so we're going to we do think theres tremendous.

Margin potential in this business, but we also think growth is really important and so youll see us balance that in the early days to really get a foothold a solid foothold in a leadership position so down the road, we see tremendous profit that we're gonna really we're going to scale fast.

It seems like a huge opportunity. Thank you very much.

Speaker 5: Our next question comes from the line of Joe Spoth with RBC Capital Mark.

Our next question comes from the line of Joe Spak with RBC capital markets. Your line is open.

Speaker 6: Thanks again, everyone. I appreciate the update on the Lord's Sound in Spring Hill Ultim Cells build out.

Thanks, Good afternoon.

Appreciate the update on the Lordstown and Springhill holds themselves build out.

Speaker 6: and when those are starting. I was wondering if you could provide a little bit more color in terms of either from a run rate basis or maybe to an absolute basis, where you think each of those.

And in Windows are starting I was wondering if you could provide a little bit more color in terms of either from a run rate basis, or maybe just an absolute basis, where you think each of those.

Speaker 6: or how long it's gonna take those facilities to get up to their stated capacity. And then maybe just a quick aside, like if Lord's Towns Opening mid 22, where are you actually getting all the themselves for the Hummer or the Bright Drop and the Lyric? Today we're getting those.

Or how long, it's going to take those facilities to get up to their stated capacity and then maybe just.

A quick aside like if sports center opening mid 'twenty, two where are you actually getting ultimate sells for the hummer that bright dropping alert.

Today, we're getting those from from LG.

Speaker 3: But, you know, as we look, we're going to ramp up those plants as quickly as we can with one coming online on 22, one on 23, and then one late 24, and one yet to be announced. So, you know, we're going to accelerate those as fast as we can. As I said in my prepared remarks, we've already, you know, found ways to add capacity from an operating perspective and efficiencies in the plant. So.

But as we look we're going to ramp up those plants as quickly as we can with one coming online on 22, one on 'twenty three and then one late 'twenty four and one yet to be announced so.

We're going to accelerate those as fast as we can as I said in my prepared remarks, we've already found ways to add capacity from an operating perspective and efficiencies in the plants. So.

Speaker 3: You know, we're just going to keep going full out because we see the opportunity for substantial EV volume growth in this period of time.

We're just going to keep going full out because we see the opportunity for substantial EV volume growth in this period of time.

Speaker 6: Okay, and then I guess following up on that, and I know you've mentioned in your marks, Mary or not.

Okay, and then I guess following up on that and I know you've mentioned in your remarks married you're not you don't really think you are constrained by your cell supply here, but it does seem like you have at least.

Speaker 6: You don't really think you're constrained by your cell supply here.

Speaker 6: But it does seem like you have at least, you know, over the next year or so, maybe an allocation decision.

Over the next year or so maybe an allocation decision.

Speaker 6: what programs those cells go to. So for instance in 23 of both the solar auto and the equinox. So how do you go about deciding that, whether it sort of goes towards?

What programs those sales go to so for instance in 23 of both the Silverado and equinox. So how do you go about deciding that whether it sort of goes towards.

Speaker 6: potentially a more profitable vehicle or a segment where you see less competition and more more potential.

No.

Essentially a more profitable vehicle or a segment, where you see less competition and more more potential white space.

Speaker 3: Well, I think we're working to expand our capability to accelerate all of those models, as I said. We're just seeing such strong demand.

Well I think we're working to to expand our capability to accelerate all of those models as I said, we're just seeing such strong demand and that's caused the team to really go back and look and say, okay, let's double down and go faster from an acceleration perspective, clearly the cells will be.

Speaker 3: And that's caused the team to really go back and look and say, OK, let's double down and go faster from an acceleration perspective. Clearly, the cells will be.

It's something that we'll look to grow as well one of the reasons why we're announcing the battery plant that we already did in Michigan and will shortly be announcing the fourth battery plant as it.

As well as continuing to work with LG. So.

Our focus right now not on trade offs, but on an Ah Ah, enabling as many as we can during this period of time and you've heard me say that between 'twenty, two and 'twenty three we want to our plan is to have over 400000 evs into market in North America, and we're just going to keep working to improve that and I have a lot of confidence in.

Speaker 9: enabling as many as we can during this period of time. And you heard me say that between 22 and 23, we want our plan is to have over 400,000 EVs into market in North America. And we're just going to keep working to improve that. And I have a lot of confidence in the GM team that when you give them a clear challenge, they rise to the occasion. Thanks. Everybody, I had a question about the EV.

The GM team that when you give them a clear challenge they rightfully occasion.

Speaker 10: Thanks.

Thanks.

Speaker 5: Our next question comes from the line of Adam Jonas with Morgan Stanley .

Our next question comes from the line of Adam Jonas with Morgan Stanley . Your line is open.

Speaker 9: thanks uh... everybody i had a question about the e-v models and implied volume per skew uh... i guess i ask it like this if you were starting in e-v company from scratch would you launch thirty different models over a three or four year period i understand why

Thanks, everybody I had a question about the EV models and implied volume per SKU.

I ask it like this if you were starting an EV companies from scratch would you.

Launch 30 different models over a three or four year period I understand why.

Speaker 9: I guess I understand why GN with the brands and different regions and things is tempted to do it, but if you had the alternative, if you consider the alternative, higher volume, maybe hundreds and hundreds of thousands of units per model, but a small number of models.

I guess I understand why GM with the brands in different regions and things that attempted to do it but if you had the alternative where we consider the alternatives.

Higher volume, maybe hundreds and hundreds of thousands of units per model, but a small number of models.

Speaker 3: So Adam, we're going to go for both. And from a General Motors perspective, I think when you look at how we've approached the technology and the investments we've made in Altium and how we're looking at the portfolio, a full portfolio. Because again, if you look at, and by the way, we think several of those models are going to be over 100,000 units or more than that as we do that. So I really would say, Adam, we're going for both. And it's one thing when you're looking at the market when it's 2%, 3%, 5%.

So so Adam.

Over 100000 units or more than that as we do that so I really would say Adam we're going for both and it's one thing when you're looking at the market when it's 2%, 3%, 5%. We're looking by 20 2030 to be in the 40%, 50% adoption and to do that.

Speaker 3: Now, we're looking by 2030 to be in the 40% to 50% adoption. And to do that, you've got to meet the customer where they're at. And that's why you look at the Equinox and how significant that can be, the more affordable EV that we're going to be doing that really gets into another very important part of the market.

Got to meet the customer where they're at and that's why you look at the equinox at how significant that can be the the more affordable EV that we're going to be doing that really gets into another very important part of the market. So you have to have the proper market coverage otherwise the customer is going to have to make tradeoffs.

Speaker 3: So you have to have the proper market coverage, otherwise the customer is gonna have to make trade-offs. And because of GM's capability, you know, at general motors at any one point in time.

And because of Gms capability, you know like General Motors at any one point in time, we have almost 100 programs in flight, meaning in concept to being launched that's the capability. The GM team has so we're moving with the speed of a startup with I think industry, leading technology and our platform, but we're also then leveraging the capability that GM has.

Speaker 3: We have almost a hundred programs in flight, meaning in-concept to being launched. That's the capability the GM team has, so we're moving with the speed of a startup with, I think, industry-leading technology and a platform, but we're also then leveraging the capability that GM has.

Speaker 3: to attract and gain, share and grow because of the vehicles that we'll have that meet their needs.

To attract and gain share and grow because of the the vehicles that will have that meet their needs.

Speaker 9: Thanks, Mary. Just as a follow-up, how certain are you that the quality problems that you had with your battery partner have been resolved? Obviously, you're implying there's some improvement, but could you tell us, are all the issues behind you, or are there still some issues that you're working through in real time? Thanks.

Thanks, Mary and just as a follow up how certain are you that the quality problems that you had with your battery partner have been resolved, obviously, you're implying there is some improvement but could you tell us are all the issues behind you or are there still some issues that you're working through in real time. Thanks.

Speaker 3: Sure. So Adam, you know, we're already putting new battery packs into existing both EVs and EVs. We wouldn't be doing that if we didn't have confidence.

Sure.

And.

Already I'm, putting new battery packs into existing bolt Evs and avs, we wouldn't be doing that if we didn't have confidence.

Speaker 3: The LG technical team and the GM team have worked together. We believe, as we said before, that it was two very rare manufacturing defects that caused the issue. And if you look at the low number of issues we had, yet the extraordinary action that we took with recalling, you know, the entire population, that's our commitment to safety. And so we have found the issues. We've put a lot more robust processes into the manufacturing process and changed.

LG technical team and the <unk> team have worked together, we believe as we said before that it was to vary.

Rare manufacturing defects that caused the issue and if you look at the low number of issues. We had yet the extraordinary action that we took with recalling that the entire population that's our commitment to safety and.

So we have found the issues, we've put a lot more robust processes into the manufacturing process and changed the <unk>.

Speaker 3: the way the processing is to make sure we don't have that issue. I also know that, you know, that was rich learnings that we had from our LG partners that have been incorporated into Altium. So, you know, again, the experience that we've had of settling Bolt EVs for a while and Bolt EVs, all of that learning is translated in and gives me great confidence in the quality of the Altium platform and the packs that we're putting into the Bolt EVs and EUVs right now.

The processing processing is to make sure. We don't have that issue I'd also note that that was rich learnings.

We had from our LG partners that have been incorporated into LTM. So you know again the experience that we've had of selling bolt evs for awhile and bolt Evs all of that learning is translated in it gives me great confidence in the quality of the Altium platform and the packs that were putting into the bolt evs in EU.

<unk> right now.

Thanks Mary.

Thanks, Adam.

Speaker 5: Our next question comes from a line of ETA McHellie with City, Your Line is Open.

Our next question comes from the line of <unk> Kelly with Citi. Your line is open.

Great. Thank you good afternoon everybody.

Speaker 11: Just thought of two questions. Maybe first I'll go back to AZ from Mary and Kyle. Mary, I think in the past, you referred to the opportunity in personal consumer AZ as upside potential to your 2030 target. I hope you could update us on the vision you have for consumers at GM as well as cruises role within that in the long run.

Just two questions, maybe first going back to <unk> from Merion, Kyle maybe I think in the past you referred to the opportunity in personal consumer as.

As upside potential through 2030 target I was hoping you could update us on the vision you have for consumers.

At G M.

As well as cruises role within that in the long run.

Speaker 3: Well, you know, for right now, with the significant announcement that Cruz made today, we want, you know, the team, like, 99.9% focused on making sure that we seize the significant opportunity in ride share and ride share delivery.

Well you know for right now with a significant announcement that cruise made today, we want the team like 99, 9% focused on making sure that we see significant opportunity in ridesharing rideshare delivery.

Speaker 3: And we said most recently at the end of last year that we see, and at CES, that we see the opportunity.

And we said most recently at the end of last year that we see and at CES that we see the opportunity for potentially as early as mid decade, they have personal autonomous vehicles, which is.

Speaker 3: potentially as early as mid decade to have personal autonomous vehicles, which is really an additive thing for crews because they put more nodes on the network.

Really an additive thing for cruise because it puts more nodes on the network.

Speaker 3: It opens up another market. So, you know, we're very focused on right share and right share delivery. So this is something that we see potentially in mid decade that

It opens up another another market. So we're very focused on rideshare and rideshare delivery. So this is something that we see potentially in mid decade that we can make both businesses grow so a huge opportunity and I don't know if you want to add anything.

Speaker 3: We can make both businesses grow. So a huge opportunity. I don't help you when I add anything.

Speaker 7: Yeah, thanks very much. The natural fit, you know, like retail AVs would increase the total volume.

Yeah, Thanks, and I, it's a natural fit.

Retail <unk> would increase the total volume of sensors and computer systems are building, it's more vehicles that are R&R common platforms.

Speaker 7: building. It's more vehicles that are on our common platforms, that power be split to driverless cars. So it drives down the cost on a unit basis and really reinforces and bolsters the core robot taxi.

Power these fleets of driverless cars and drive down the cost on a unit basis, and really reinforces and bolsters the core robo taxi business. So we see it as a really a win win situation.

Speaker 7: where it improves the economics of the robot taxi business, but also enables a new market in the expansion of the positive impact from this technology.

Where it improves the economics of the Robo taxi business, but also.

<unk> enables a new market and the expansion of the positive impact from this technology.

Speaker 11: That's very, very helpful. Maybe a quick follow up, but maybe for Paul, I'm hoping you could mention the variable profit opportunity from the refreshed full size pickup trucks I think are coming in the spring, both in terms of maybe pricing opportunities with the new content as well as any opportunities with the upgraded electrical architecture.

So that's very very helpful. Maybe a quick follow up maybe for Paul.

Hoping you could dimension.

Variable profit opportunity from the refreshed our full size pickup trucks I think are coming in the spring both in terms of maybe pricing opportunities with the new content as well as any opportunities with the upgraded electrical architecture.

Speaker 4: Thank you, guys. What I would say is, excuse me, that...

Well.

So what I would say is.

Give me that.

Speaker 4: You know, what we see right now and what we continue to see is a really, really strong consumer preference, especially as they're buying up on features and amenities. We see that across the board in the Denali brands, high country brands, et cetera, that, you know, I think it's going to continue to pay big dividends for us as we roll out, you know, the new vehicles going forward. So without getting into specifics on...

What we see right now and what we continue to see is a really really strong consumer preference, especially as they're buying up on features and amenities, we see that across the board in the in the Denali brands high country brands et cetera that I think is going to.

They need to pay big dividends for us as we rollout.

The new vehicles going forward, so without getting into specifics on on vehicle margins.

Speaker 12: on vehicle margins and and profitability. We're very excited about what that's gonna bring. And we think that the consumer is gonna be really, really positive around them. Great.

Profitability, we're very excited about what that's going to bring and we think that the consumer is.

We're going to be really really positive around them.

Great. That's all very helpful. Thank you.

Speaker 5: Our next question comes from a line of a manual rosner with Deutsche.

Our next question comes from the line of Emmanuel Rosner with Deutsche Bank. Your line is open.

Speaker 13: Thank you very much. Two questions please.

Thank you very much two questions. Please.

Speaker 13: The first one, could you please describe the current supply chain environment any constraints to let on the chip availability? And in particular, it was a bit interesting to hear.

The first one could you please describe the current supply chain.

Environment any constraints to lift on the <unk>.

Chip availability and in particular was I'd be interested to hear what gives you confidence that you have we would have sufficient chip availability did you produce 25% to 30% more vehicles in 2022 versus 2021 admittedly you were hit maybe a bit harder than other players but.

Speaker 13: What gives you confidence that you would have sufficient chip availability to produce 25 to 30 percent more vehicle in 2022 versus 2021? Admittedly, you were hit maybe a bit harder than other players, but obviously this is a nice size bounce back.

We see this as a nice sized announcements.

Speaker 3: Yeah, Emanuel, thanks for the question. What we're sharing is what we see with the work that we've done with all of the semiconductor manufacturers and our plans for this year.

Speaker 3: You know, of course, and Paul said, you know, if there's significant COVID disruptions or other natural disasters that could have an impact, but we're pretty, we're definitely seeing improvement in first quarter over fourth quarter. We saw fourth quarter better than third quarter. And we really see with the plans we have in place now, by the time we get to third and fourth quarter, you know, we're gonna be, you know, really starting to see the semiconductor constraints diminish.

If there is a significant COVID-19 disruptions or other natural disasters that that could have an impact, but we're pretty we're seeing definitely seen improvement in first quarter over fourth quarter, we saw fourth quarter better than third quarter, and we really see with the plans. We have in place now by the time, we get to third and fourth quarter, we're gonna be really start.

To to see the semiconductor constraints diminish.

Speaker 3: So, that's what we're working to achieve across all of our platforms and across the globe, frankly, with all of our suppliers, but that's our best current outlook that we're sharing.

So that's what we're working to achieve across.

All of our platforms and across the globe frankly, with all of our suppliers, but that's our best current outlook that we're sharing.

Speaker 13: Great. Just a quick aside on this, and then I have a second question on the cruise. But just a clarification, the 25 to 30 percent, you're confident you could do this in North America? Since I think for China, I think Paul said that you were looking probably at more stable volume year over year?

You are looking probably its more stable volume year over year.

Speaker 4: Hey Emmanuel, 25-30% is a global production number, so there's some in the U.S. and there's some in the GM International as well.

Yeah, Hey, Emmanuel 25% to 30% of the global production number.

There are some in the U S and there is some in the GM international as well.

Speaker 13: Understood. And then second question would be on cruise. Mary, what are your current thoughts on optimal timing to bring this to capital markets? Not just because of growing capital needs, you know, with the commercialization, which seems like you have that already well in place, but also as a way to potentially unlock some additional value for shareholders.

Understood and then second question would be on.

On crews.

Some additional value for shareholders.

Speaker 3: Yes, I've always said, and the belief that's held by, you know, I'd say the cruise board and the GM board, that we're going to do what's in the best interest of shareholders to create long-term value. And we do not see that a capital raise event is something that we need in the near term. We're, the cruise is well capitalized and has strong financial support from its investors.

Yes Emmanuel.

And I have always said.

And is the belief that's held by you know I'd say the cruise born in the <unk> that we're going to do what's in the best interest of shareholders to create long term value and we do not see that a capital raise event is something that we need in the near term our purchase well capitalized and has strong financial support from its investors Jamie.

Speaker 3: GM is well-funded and so we don't really think we need to raise additional funds at this time. We also are committed to making sure we have competitive compensation packages at crews to attract and retrain the best and the brightest talent to achieve the objectives and our growth initiatives here. So my answer to be we're always going to look and do it's in the best interest but as we look now we're in the first chapter.

Jim is well funded and so there we don't really think we need to raise additional funds at this time.

We also are committed to making sure we have competitive compensation packages at cruise to attract and retain the best and the brightest talent to achieve the objectives in our our growth.

Initiatives here so.

My answer to be with it you know, we're always going to look and do what's in the best interest, but as we look now where in the first chapter.

Speaker 13: and there's still so much that can be accomplished with a frictionless environment between crews and GM, and that's what we're really focused on, getting the technology out safely and then really growing at a pace where we can have leadership. I understood. Thank you. Thank you. Thank you.

And there's still so much that can be accomplished with a frictionless environment between cruise and GM and that's what we're really focused is getting the technology out safely and then really growing at a pace, where we can have leadership.

Understood. Thank you.

Our next question comes from the line of Dan Levy with Credit Suisse. Your line is open.

Speaker 14: Hi, good evening. Thank you for taking the question. Um, maybe 1st, a question for you, Paul on the parameters of the guidance.

Hi, good evening, Thank you for taking the questions.

Maybe first.

A question for you Paul on the parameters of the guidance.

Speaker 14: I know you haven't articulated you know, guidance by segment. There's some details there, but Just give in the comments for whole sales up 25 to 30% and you're reaffirming the 10% GM North American margin guide even after factoring in the GMF decline and higher spend for software and crews

EBIT guidance I know you haven't articulated.

<unk> segment Theres some details there, but just given the comments for wholesales up 25% to 30% and you're reaffirming the 10% GM North America margin guide even after factoring in the GM has declined and the higher spend per software and crews.

Speaker 14: I guess I'm wondering how you reconcile to having that lower half of the guidance because it seems like with that 10% North America got margin guidance alone and that 25 to 30% volume growth.

I guess I'm wondering how you reconcile to having that lower half of the guidance because it seems like with that 10% North America margin guidance alone about 25% to 30% volume growth.

Speaker 14: It pretty easily gets you to the upper half again. So in what scenario would you get to that lower half of the guide or is that just conservatism for, you know,

Pretty easily gets you to the upper half again, so in what scenario would you get to that lower after the guide or is that just conservatism for the unknown unknowns.

Speaker 4: Yeah. Hey, Dan, thanks for the question. You know, what I would say is this is very much a midpoint convention guide as we're thinking this. Obviously, we've expanded the range over prior years, which I think is a reflection of the volatility that we've seen in the place. You know, I would be careful about extrapolating too much across kind of the...

Yeah, Hey, Dan Thanks for the question what I would say is this is this is very much.

Our midpoint Convention guide as we're thinking this obviously, we've expanded the range over prior years, which I think is a reflection of the volatility that we've seen.

In the place.

I'd be careful about extrapolating too much across kind of the.

Speaker 12: profitability from the incremental vehicles as we talked about and very intentional in the prepared remarks.

Profitability from the incremental vehicles as we talked about very intentional in the prepared remarks.

Speaker 12: You know, a lot of that incremental volume is coming in, you know, at a lower contribution than what we've seen from the full-size truck.

A lot of that incremental volume is coming in in.

At a at a lower contribution than what we've seen from the full size trucks and Suvs going forward Thats, just where the capacity is for us going forward. So what I would say is with a really robust consumer and a strong continued environment, we would probably trend towards the high end of that.

Speaker 12: going forward that's just where the capacity is for us going forward.

Speaker 4: So, you know, what I would say is with a really robust consumer and a strong continued environment, you know, we would probably trend towards the high end of that. But you know, we have a lot of volatility, so to the extent that we see

Speaker 4: Consumer weakness, we see more supply chain pressure, we see more disruption.

Speaker 4: in the global logistics platform that impacts production than we could be at the lower end of the number. But we wanted to give a range that was focused around the midpoint of our expectation, as well as gave some comfort and some deference to the volatility of the system.

Deference to the volatility that we see.

Speaker 14: Uh, okay, thanks. Thank you. That's helpful. And then 2nd, Mary, maybe just a question on, you know, I'd like to revisit the, the, the platform and the benefit.

Okay.

Okay. Thank you that's helpful and then second.

Mary maybe just a question on <unk> I'd like to revisit that.

Platform independent benefits, so you know.

Speaker 14: So, you know, if we go to Silverado, and I know you haven't unveiled the full set of specs, but the 1, 1 question with, which has come up in the industry community is that on some of the metrics.

Go to the easy Silverado and I know you haven't unveiled the full set of specs, but.

One question was which has come up in the Investor community is that on some of the metrics.

Speaker 14: Um, relative to, you know, the other competition that's out there, it's, it's not showing the type of. Advantage over your competitors that maybe some had anticipated. So maybe we can just zoom out and think as you're launching the ultimate vehicles.

Relative to the other competition that's out there it's not showing the type of advantage over your competitors that maybe some had anticipated. So maybe we can just zoom out.

Youre launching the OPM vehicles, what are the benefits that we're going to see.

Speaker 14: What are the benefits that we're going to see versus your competitors? Is it just these are going to be more profitable vehicles? Is it that it's going to show up in other areas of battery efficiency? Is it that this can help unlock more range that others can't have? So, you know, what are the benefits of Ultium that we're going to start to see within the vehicle on a more of a metric basis?

Versus your competitors' niches and he is going to be more profitable vehicles is it that is.

I'm going to show up in other areas of battery efficiency is it that just can help unlock more range that others can't hubs.

What are the benefits of opium that we're going to start to see within the vehicles called out more or less call it metric basis.

Speaker 3: Yeah, well, so, I mean, I think when we look at what Ultium is providing, first of all, it's going to give us scale, and we do think as we get the full portfolio of Ultium launched, we're going to see that scale, and it's going to give us an advantage from an overall margin perspective. But specifically for the Silverado EV, leveraging Ultium, we have longer range, 400 plus miles, faster charging, better towing capability.

We have longer range, 400, plus miles faster charging better towing capability.

Speaker 3: And I think you have to really look at this as opposed to, I know there's been some focus on the miles per kilowatt hour, and we haven't put all the specs out, and it's going to vary with a lot of features that you choose. I mean, we very carefully look to say...

And I think you have to really look at this as opposed to I know there's been some focus on the miles per kilowatt hour.

Haven't put all the the fact pattern is going to get a very with a lot of features that you choose I mean, we very carefully look to say what are we going to provide for the customer what does the customer want in this segment, what's important to them and when you look at more range faster charging more this is more capability in the real world.

Speaker 3: What are we going to provide for the customer? What does the customer want in this segment? What's important to them? And when you look at more range, faster charging, this is more capability in the real world. Then when you look at the LTM platform, also it gives us the opportunity to have a mid-gate.

Then when you look at the LTM platform also it gives us the opportunity to have a mitigate which gives us much more flexibility.

Speaker 3: which gives much more flexibility. Also, you know, being able to drive these trucks, people are going to see the benefit of a fully integrated battery pack and body structure, which gives us a mass advantage as well as, we think, superior vehicle dynamics. So, and...

Speaker 3: you know from an ultimate perspective the other thing i would say is it relates to the truck portfolio is going to give us an opportunity to have a full truck portfolio faster uh... and you know as we've seen over the last couple years think about when we rolled out on this current generation of truck

From an LTM perspective, the other thing I would say as it relates to the truck portfolio, it's going to give us an opportunity to have a full truck portfolio faster.

And as we've seen over the last couple of years think about when we rolled out this current generation of trucks.

Speaker 3: You know, we went high feature and high value and, you know, we've grown our truck share capability. So, we know that truck customer, there's some that want high value, some that want high feature. Ultium is going to give us the opportunity to, again, expand that capability.

We went on high feature in high value and.

We've grown our truck share capability. So we know that truck customer theres, some that want high value. Some that want high feature all team is going to give us the opportunity to again.

Speaker 3: delight the customer with what they're specifically looking for, as opposed to, you know, one or two point solutions off of a retrofitted platform.

Delight the customer with what they are specifically looking for as opposed to you know one or two point solutions off of a retrofitted platform.

Great. Thank you very much.

Speaker 5: Our next question comes from the line of Colin Langan with Wells Fargo.

Our next question comes from the line of Colin Langan with Wells Fargo. Your line is now open.

Speaker 12: Oh, great. Thanks for taking my questions. I just wanted to clarify on the cruise announcement, people are able to sign up on the waitlist. Does that mean you're actually going to be able to do it soon, like today, or is that like you're on a waitlist in a couple months?

Oh, great. Thanks for taking my questions I, just wanted to sorry, I hope, it's not too basic I just wanted to clarify on the cruise announcements.

People are able to sign up on the waitlist does that mean youre actually going to be able to do it soon or like today or is that like you're on a waitlist and then a couple of months they were able to actually start taking rides or any I just want to clarify that it was just kind of felt like it might have been today and then I assume that means you have that sort of final license I think you've talked about it you need it in San Francisco to deploy.

Speaker 15: they're able to actually start taking rides. I just want to clarify that it just kind of felt like it might have been today. And then I assume that means you have that sort of final license.

Speaker 7: Hi, Colin. Thanks for the question. So the wait list is open and based on the early demand we saw this morning, there's going to be a pretty long list pretty quickly. And we are starting small with a limited number of vehicles, limited hours. And so, you know, I don't think we're going to be able to get to everyone on that list in the next week or two. And so it could be some time before people on the wait list get to see the product. But we are, we have already started carrying members of the public and we're working through that wait list now adding new people every day. The other part of your question, I'm sorry.

Hi, Collin. Thanks. Thanks for the question. So the waitlist is open and based on the early demand. We saw this morning, there's going to be a pretty long list pretty quickly.

The other part of your question I'm sorry.

I think I'd answer that I assume then you got that last license. So thank you very much yeah on the permit we still have five out of the six necessary permits to operated fared rideshare services. So as of today all of the Reds are free and we filed the last the application for the last remaining permit in November last year, and we continue to work with the CPUC.

Speaker 7: Oh yeah, on the permit, we still have five out of the six necessary permits to operate a fared ride share service, so as of today, all of the rides are free, and we filed the last application for the last remaining permit in November last year, and we continue to work with the

Speaker 7: California Public Utilities Commission and answer questions they have about that application as they pop up. So stay tuned for more news on that.

California Public Utilities Commission and answer questions. They have about that application as they pop up.

So stay tuned for more news on that.

Speaker 15: I want to follow up on the 25 to 30 again. Other automakers are announcing cuts, so it's a bit surprising. What kind of line of sight do you have? Is it just that you have maybe a bigger buffer stock now that you're maybe more able to swap out some?

Thank you and then just I wanted to follow up on the 25 to 30 of cats area. Other automakers are announcing cuts. So it's a bit surprising I mean, what kind of line of sight do you have I mean is it just that you have maybe a bigger buffer stock now that you're maybe more able to swap out some of these chips.

Speaker 15: It feels a little risky considering it seems to have been surprised over the last year that the supply wasn't there, and it seems like a very fragile semi-pipeline, it seems. Any sort of visibility there?

Pivotal risky considering it seems you've been surprised.

Over the last year, the supply wasn't there and it seems like a very fragile semi pipeline it seems.

Any sort of visibility there that you can provide.

Well again as I said.

Speaker 3: We have been working closely with our supply base, with the tier ones as well as the semiconductors.

Speaker 3: You know, we said last year that we were going to work deep into the tiered base and understand the capabilities.

Speaker 3: You know, we were hit pretty hard last year, third quarter, with Malaysia, because it just so happened that the facilities that have a lot of GM business happened to be hard hit by COVID. And, you know, you saw the losses we suffered there, so I think that's a bit of it.

Were hit pretty hard last laugh.

Last year third quarter with Malaysia.

It just so happened at the facilities that have a lot of GM business happen to be hard hit by Covid and you saw the losses, we suffered there so I think that's a bit of it but.

Speaker 3: You know, this, this is our best estimate with the detailed work that we've been doing, you know, all last year and this year. Now, you know, we still get surprises and then we work to.

This is our best estimate with the detailed work that we've been doing.

All last year and this year now we still get surprises and then we work to two to solve those issues either with an engineering solution or making tradeoffs between vehicles. We believe we're going to continue to do that but what we're sharing with you is based on everything we know today based on the commitments of the supply base and borrowings.

Speaker 3: to solve those issues either with an engineering solution or making trade-offs between vehicles. We believe we're going to continue to do that. But what we're sharing with you is, you know, based on everything we know today, based on the commitments of the supply base, and, you know, barring some major COVID disruption or some major natural disaster supply chain disruption, this is what we think we're going to be able to do.

Major COVID-19 disruption or some maybe major national natural disaster supply chain disruption. This is what we think we're going to be able to do.

Speaker 4: And Colin, if I could just add to that, you know, I think, excuse me, understand some of the skepticism, especially based on the volatility and where others are going forward. But this is why we wanted to add the point in there about where we see Q1.

And Colin is I can just add to that.

Excuse me understand some of the skepticism, especially based on the volatility and where others are.

Forward, but this is why we wanted to add the point in there about where we see Q1.

Speaker 12: You know, we're coming off of a lower baseline in the second half of the year, largely because of the impact that Mary mentioned, but, you know, the run rate that we've seen sequentially from 3Q to 4Q to 1Q is giving us a heightened level of confidence. It doesn't mean that things won't pop up, but certainly what we're seeing in the very, very near term is giving us a little bit more confidence.

It is giving us a little bit more confidence and I think the general consensus is that.

Speaker 12: And I think the general consensus is that, you know, things will be more stable in the second half of the year than in the first half of the year. So that's kind of how we're extrapolating.

Things will be more stable in the second half of the year than in the first half of the year. So that's kind of how we're extrapolating our expectations.

Okay. Thanks.

Yes.

Speaker 5: Our next question comes from the line of Ryan Brinkman with JPMorgan.

Our next question comes from the line of Ryan Brinkman with Jpmorgan. Your line is open.

Speaker 8: Hi, thanks for all the color on the 2022 outlook, including relative to both volume and pricing. I'm curious for your thoughts on mixing 22. so, for example, as, you know, chip supply continues to hopefully normalize. Does that mean? You may produce more modestly priced or lower trim model vehicles, including for rental customers, et cetera. You know, what's the right way to think about how much of the much richer mix has been supply driven with.

How much of the much richer mix has been supply driven with automakers, including yourselves up to produce only higher end vehicles, Enzo could maybe unwind versus how much of the much richer Mitch mix is maybe more.

Speaker 9: automakers, including yourself, opting to produce only higher-end vehicles and so could maybe unwind versus, you know, how much of the much richer mix is, you know, maybe more sustainable demand driven, for example, with consumers, you know, increasingly demanding these high-end features. What do you think?

<unk> demand driven for example, with consumers increasingly demanding these high end features what do you think.

Speaker 4: Well, thanks for the question, Ryan. You know, I think we continue to see and have talked all through 2021 about the strength of the consumer and the strength of the new models, especially in the full-size trucks and SUVs and how customers were buying up for them. So that, there's nothing that's changed underlying in the consumer from that standpoint. The comment that we made.

Well. Thanks for the question Ryan I think we continue to see and talk to all through 2021 about the strength of the consumer and the strength of the the.

The new models, especially in the full size trucks, and Suvs and how customers were buying up for them. So.

Theres nothing thats changed underlying in the consumer from that standpoint, the comment that we've made in their prepared remarks was largely a function of the increased volume.

Speaker 12: in the prepared remarks was largely a function of the increased volume because we were running full out on a lot of the full-size trucks and SUVs. There is some incremental production capabilities but really a lot of the unmet.

Because we were running full out on a lot of the full sized trucks and Suvs. There is some incremental production capabilities, but really a lot of the unmet.

Speaker 12: uh... production or underutilized production that was uh... hit in twenty one was in the crossover smaller SUVs and sedans.

Production or underutilized production that was a hit in 'twenty one was in the crossover of smaller Suvs and sedans.

Speaker 12: uh... so by definition that's where a lot of the production uh... increases in volume increases are going to be in twenty twenty two

So by definition, that's where a lot of the production increases and volume increases are going to be in 2022, I don't think that that changes mix, we're going to see.

Speaker 4: I don't think that that change is mixed, we're going to continue to watch that.

Speaker 3: with the consumer going through 2022, and it's something that we can adjust on the fly as we see that going forward. But no reason to believe that the strength of the consumer is deteriorating from what we saw in 2021. And the only thing I'd add, Paul, is, you know, then when you look at the new full-size truck...

To watch that with the consumer.

Going through 2022, and it's something that we can adjust.

Full size trucks.

Speaker 3: uh... with the enhancements that we've made uh... and and frankly even offering further up-level models i think that's just a another huge opportunity for us so i think it can be a positive year for for that and and again we focused on those vehicles that we have no uh... we're already running full out so we have no capacity to make up uh... which you know kind of put a little more color onto what paul said about where the opportunity to add this year

With the enhancements that we've made and frankly, even offering some.

Further up level models I think that's just another huge opportunity for us. So I think this can be a positive year for for that and and again, we focused on those vehicles that we have known well.

Already running full out so we have no capacity that make up.

Which kind of puts a little more color onto what Paul said about where the opportunity to add this year.

Speaker 14: Very helpful, thank you both. And just lastly, maybe a related follow up question on if there might now be a, you know, new normal that you see in terms of US industry sales. We used to say that normalized US demand was around 17 million. And so it did average around 17 million for a long time. But now there was also when vehicles cost.

Very helpful. Thank you both and just lastly, maybe a related follow up question on if there might now be.

New normal that you see in terms of U S industry sales, we used to say that normalized U S demand was around $17 million until did average around 17 million for a long time, but there was also win vehicles cost 30 or $35000 versus another more like 40 or $45000. So just curious if you have any updated thoughts on.

Speaker 14: $30,000 or $35,000 versus, you know, now they're more like $40,000 or $45,000. So just curious if you have any updated thoughts on any new normal in terms of, you know, sales and pricing, etc.

Any new normal in terms of.

Sales and pricing et cetera.

Speaker 3: I don't know if there's anything normal right now when you look at all of the challenges that the industry is still facing. As Paul said, we think we've got a large pent-up demand, especially for GM vehicles, and strong full-size trucks coming out. We continue to see just incredibly strong.

And you know strong full size trucks coming out we continue to see just incredibly strong.

Speaker 3: demand for a full-size SUVs and mid-size crossovers. So I think it's too early to declare normal when we're still impacted by the semiconductor shortage. You know, they're still buying behavior as an outcome of COVID and some of the support that was provided. So I think it's going to take a little while before we declare normal. Okay.

Demand for our full size Suvs and mid sized crossover. So I think it's too early to declare normal when we're still impacted by the semiconductor shortage, there's still buying behavior.

As an outcome of Covid and some of the stimulus.

Support that was provided so I think it's going to take a little a little while before we declare normal.

Okay very helpful. Thank you.

Speaker 5: Our last question comes from the line of Brian Johnson with Barclays your line

Our last question comes from the line of Brian Johnson with Barclays. Your line is open.

Speaker 16: Hi, team. It's Stephen Temple. I'm for Brian . Just two questions here from us. In terms of the kind of consolidating the semiconductor purchasing the three families and the co-development, I guess, where do we stand on that? And then what's the kind of most expected time frame when that could add to incremental chip supply?

Yes, Hi team this is Steven Hempel on for Brian .

Just two questions here from from US in terms of the.

Kind of consolidated the semiconductor person three families and the co development or I guess, where do we stand on that and then what's the kind of what's expected timeframe when that that could add too.

Incremental chip supply.

Speaker 3: You know, that's a mid-term type of solution. Clearly, you know, it's full speed ahead of working with the partners that we announced and, you know, getting to the families and so reducing complexity, which we think will, you know, allow us to secure supply in addition to the relationships that we're creating with these strategic partners. But that's a mid-term solution, not a short-term solution.

Allow us to secure supply in addition to the relationships that we're creating with these strategic partners, but that's a mid term solution not a short term solution.

Speaker 16: Okay. And then I guess a somewhat related question in terms of the long-term margin target laid out at the capital markets day, 12 to 14% margins. It looks like as we go into 2022, there's a decent amount of step up in investment for some of these related businesses. I guess the move out to 2030, should we be expecting a kind of a directionally linear move towards that 12 to 14% or should we be expecting some years to be kind of flattish or even potentially down as we shift out of ice into buzz and bring

Okay and then.

I guess somewhat related question in terms of the long term margin targets laid out at the capital markets day, 12% to 14% margins it looks like as we.

Go into 2022 hotels with a decent step up in investment for some of these related businesses I guess the <unk>.

Moved out to 2030 should we be expecting a kind of a directionally linear move towards that 12% to 14% or should we be expecting some years to be kind of flattish or even potentially down as we shift out of.

I assume the buzz and bring on new businesses.

Speaker 12: Hey Stephen, it's Paul. So what I would say is it's a little bit lumpy between now and then, because if you think about the trajectory, the number one priority and foundation that we're building is getting the EV fleet out there.

Hey, Stephen It's falls, so what I would say is it's a it's a little bit lumpy between now and then because if you think about the trajectory the number one price.

Alrighty and foundation that we're building is getting the EV fleet out there.

Speaker 4: uh... so you're gonna be a lot of the revenue growth really driven by evie

So youre going to see a lot of the revenue growth really driven by Evs.

Speaker 4: over the next few years. And as you get into the latter half of the decade, and you've got the Altify platform out there and growing that foundation through electric vehicles, you're going to start to see what we think is going to be a pretty quick ramp up in the software. So the revenue growth is going to be a little bit more steady, especially as we look at what crews is doing going forward. The margin performance is probably lagged a little bit because some of the higher margins is going to be a little bit more steady.

Over the next few years and as you get into the latter half of the decade, and you've got the <unk> Ultra five platform out there and growing that foundation through electric vehicles, you're going to start to see what we think is going to be a pretty quick ramp up in the software. So the revenue growth is going to be a little bit more steady, especially.

As we look at what cruisers doing going forward.

The margin performance is probably lags a little bit because of some of the higher margin revenue opportunities from software and connected vehicles.

Speaker 16: revenue opportunities from software and the connected vehicles are going to come after we get that foundation built in the latter part of the decade. Okay. Understood. Thanks for taking our questions.

There are going to be are going to come after we get that foundation built in the latter part of the decade.

Okay understood. Thanks for taking our questions.

Okay.

Thank you I would now like to turn the call over to Mary Barra for her closing comments.

Speaker 3: Thanks, Jordan, and thanks, everybody, for your questions. You know, I want to close again by thanking the GM team, you know, broadly, including the GMF team, our union partners, our dealers, and our suppliers. You know, the work that they did together, seizing opportunities, addressing challenges, is what allowed us to have this record performance. And we take that collaboration and problem-solving agility and resiliency into 2022, and we apply that to continuing to accelerate our EV transformation, the work in software, and, of course, supporting our crews.

Thanks, Jordan and thanks, everybody for your questions.

To close again by thanking the GM team.

<unk>, including the Gms team, our Union partners, our dealers and our suppliers you know the work that they did together.

Seizing opportunities addressing challenges is what allowed us to have this record performance and we take that collaboration and problem solving agility and resiliency into 2022, and we apply that to.

Continuing to accelerate our transformation the work in software and of course supporting our crews.

Speaker 3: company as well. So I couldn't be more excited about 2022 and what the year and how it can unfold. I hope you see the clear sense of determination that we have and we will move even faster to deliver on our commitments and achieve the growth that we know is right in front of us. So I wanna assure you that we'll keep you updated every step of the way, but 22 is gonna be an exciting year. Thank you.

Our company as well so I couldnt be more excited about 2022, and what the year and how it can unfold I hope you see and you see the clear sense of determination that we have and we will move even faster to deliver on our commitments and achieve the growth that we know is right in front of us so.

I want to assure you that we will keep you updated every step of the way, but 'twenty two is going to be an exciting year.

Thank you.

Okay.

That concludes the conference call for today, Thank you for joining us.

Q4 2021 General Motors Co Earnings Call

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