Supply chain issues dent Q2 profits at General Motors

General Motors reported a decline in second-quarter profits on Tuesday as the car maker was hit by supply chain disruptions, particularly in June.

Net income fell to $1.7bn from $2.8bn in the same period a year earlier. Meanwhile, adjusted earnings per share declined to $1.14 from $1.97, coming in below expectations of $1.20, while revenue ticked up to $35.8bn from $34.2bn.

Chair and chief executive officer Mary Barra said: "We have been operating with lower volumes due to the semiconductor shortage for the past year, and we have delivered strong results despite those pressures.

"There are concerns about economic conditions, to be sure. That’s why we are already taking proactive steps to manage costs and cash flows, including reducing discretionary spending and limiting hiring to critical needs and positions that support growth. We have also modelled many downturn scenarios and we are prepared to take deliberate action when and if necessary."

The company reaffirmed full-year guidance for net income of between $9.6bn and $11.2bn.

"This confidence comes from our expectation that GM global production and wholesale deliveries will be up sharply in the second half," it said.