GM CFO ‘increasingly confident’ in achieving 2021 earnings targets despite chip shortage

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General Motors employees work on the assembly line at the Fairfax Assembly & Stamping Plant in Kansas City, Kansas.
Jim Barcus for General Motors

General Motors CFO Paul Jacobson is “increasingly confident” the automaker will hit its earnings targets for the year despite a global shortage of semiconductor chips that’s forced several plant closures.

“This is a very volatile situation and it changes a lot. I still feel comfortable that the full year, we’ll be able to deliver the numbers we said we were because we’re thinking creatively,” he said Wednesday during a Bank of America conference.

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GM had a “really solid” first quarter, led by strong consumer demand, according to Jacobson. He warned investors “it’ll be choppy for the first half of the year, particularly as it relates to free cash flow.”

GM’s earnings forecast for the year is $10 billion to $11 billion, or $4.50 to $5.25 per share, in adjusted pretax profits and adjusted automotive free cash flow of $1 billion to $2 billion. The forecasts factor in the potential impact of the chip shortage, including a hit of $1.5 billion to $2.5 billion to its free cash flow.

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