General Motors 2Q15 Earnings Call Notes

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Net income of $1.1B

“we’ve posted a net income of $1.1 billion and an EBIT adjusted of $2.9 billion. And if you look across our regions from North America, it was strong year-over-year performance in the quarter that was anchored by a record $2.8 billion EBIT adjusted and a 10.5% EBIT adjusted margin.”

You can expect us to be aggressive with technology

“I think you can expect to continue to see General Motors be very aggressive when we look at the technology and innovation we’re bringing into the vehicle and for the whole ownership experience.”

Potential to achieve 10% EBIT margin

“our potential for achieving a 10% EBIT adjusted margin in 2016 is evidenced not only by what we did in Q2, but with eight straight quarters now of year-over-year margin expansion”

Expecting low single digit growth for the industry in China this year

“based on the current environment, we now expect the industry in China to grow for the full year in low single-digit range versus 2014. And despite somewhat anemic growth in the first half of the year, from an industry perspective around 1%, our low to mid single-digit growth forecast is underpinned by several factors.”

Clearly there have been some headwinds in June and July in China

” the potential recovery from the current reaction to the volatilities in the stock market. Clearly, June and thus far in July there’s been pretty significant headwinds on a year-over-year basis. We don’t anticipate that that is going to continue through the year, but that is something we’re going to have to monitor.”

We haven’t changed our long term expectations of China

“we continue to expect China to grow. We haven’t changed our long-term view of China to be somewhere in the range of 35 million and we’re not the only ones that do that.”

We can add capacity pretty quickly in China

” adding capacity in China is something that we can do quite quickly. So we will continue to monitor the situation and look at, as we have our plans to add capacity, to do it prudently with a daily read on where the market is and then looking over that horizon from a trend of where it’s going. So we will be monitoring that closely and we will only do when we think it’s prudent to do.”

Add capacity through line rate or new plants

“I think there is a lot of different ways to add capacity. You can add capacity by increasing line rate which is more equipment changes or smaller expansions, all the way to an all-new plan and each of those have different timelines. But I would also say China is one of the quickest across all of those aspects of being able to add capacity. Again, those are all the levers we have.”