Vroom! GM pulls $4bn in 3Q profits after COVID factory shutdowns

General Motors is posting huge third-quarter numbers, pulling in $4bn in profit over three months, after a short money-losing stretch as the spread of COVID-19 shut down all car factories in the United States.

Carmakers have sprinted out of their pandemic lockdowns, and GM’s big quarter follows similar performances at crosstown rivals Ford and Fiat. All three blew past Wall Street’s sales and profit projections.

Last week, Fiat Chrysler reported a $1.4bn quarterly profit. Ford earned $2.39bn, triple the Wall Street projections.

While shares are down for the year, the stock of all three carmakers has surged in the past three months. Shares of General Motors Co. jumped 6 percent before the opening bell on Thursday.

GM’s adjusted earnings were $2.83 per share, easily outpacing Wall Street’s per-share projections of $1.43, according to a survey by FactSet. Revenue of $35.5bn was about in line.

The company swung back strongly from a $806m loss in the second quarter when it was restarting factories shuttered for safety during the early stages of the pandemic.

Car sales across the globe have bounced back strongly, particularly in China, which has held additional coronavirus outbreaks in check. GM’s sales in China jumped 12 percent in the third quarter, with sales of its Buick and Cadillac brands rising more than 25 percent.

In the US, GM’s most profitable market where the pandemic has gone largely unchecked, sales fell 9.9 percent in the third quarter compared with a year ago.

That is still a dramatic improvement over the 34 percent sales drop in the second quarter. And sales improved sequentially each month in the most recent quarter, the carmaker said – an encouraging trend.

GM’s profit was boosted by higher-priced pick-up trucks and large SUVs, which have seen strong sales in the US through the pandemic. It was the best quarter on record for GM’s Chevrolet Blazer. Sales of the Cadillac XT6 spiked 45 percent in the US over last year. Large pick-ups also sold well.

GM is also pumping $2bn into its Spring Hill, Tennessee, manufacturing plant to push its transition to produce electric vehicles.