This article is keeping track of General Motors (NYSE:GM) quarterly vehicle deliveries and sales. The data in the following charts are obtained from GM’s financial statements under the “Vehicle Sales” section. The following snapshot shows an example of the vehicle delivery data disclosed in the company’s financial statement.
Take note that GM presented two types of vehicle deliveries data in its financial statements: (1)wholesale vehicle sales and (2)total vehicle sales.
The main difference between the two types of vehicle deliveries data lies in revenue correlation. For instance, the wholesale vehicle deliveries data correlates with GM’s revenue recognized from the sales of vehicles whereas the total vehicles sales data does not correlate with the company’s revenue presented in the income statements.
The following paragraph shows the explanation extracted from GM’s 4Q 2019 quarterly filing that differentiates between wholesale and total vehicle sales data.
Wholesale Vehicle Sales
GM presented the total vehicle sales data in most of the company earnings release reports. For example, the quarterly earnings release and earning deck is one of those earnings release reports that contain the total vehicle sales data. As such, what you see in most of these reports are total vehicle sales data that do not correlate with sales revenue recognized in the income statements.
Nevertheless, the vehicle delivery or sales numbers presented here, in subsequent charts below, are the “wholesale vehicle sales” data that correlate closely with total revenues disclosed in GM’s income statements.
Chart of GM’s Wholesale Vehicle Deliveries
The chart above shows GM’s quarterly wholesale vehicle sales for the past 6 years from 2014 to 2020.
I would like to stress again that the vehicle delivery data presented in the current chart correlates with GM’s recognized revenue in the income statements.
As seen from the chart, GM’s wholesale vehicle deliveries have been trending downward over the past 6 years and the downtrend has accelerated in recent years, hitting record low at only 966,000 vehicles in 1Q 2020.
The plunge in vehicle sales in 1Q 2020 represents a year over year decline of -11.8%. However, the 1Q 2020 quarter recorded a sequential increase of 1.5% in vehicle deliveries compared to the prior quarter. The record low vehicle deliveries in 1Q 2020 was one of the worst quarters over the past 6 years in which quarterly vehicle sales plunged below the 1 million threshold.
To make matter worse, GM’s vehicle sales have already started to decline when it first sold off its European subsidiary back in 2017. In the same year, vehicle sales plunged nearly 300,000 units in 3Q 2017 from the prior quarter. Since then, the weak demand for GM’s automotive products has continued all the way to 2019.
Moreover, GM saw the steepest decline in wholesale vehicle sales in 2019 and 2020, with both 4Q 2019 and 1Q 2020 recording the worst figures consecutively, illustrating that poor vehicle sales was not a one-time event but has actually persisted over multiple quarters since 2019 and continued towards 2020.
Judging from the trend of the chart, the outlook for GM’s vehicle deliveries in 2020/21 looks grim and sales will probably further decline as a result of the COVID-19 outbreak and low demands for automotive products from the retail market.
Chart of GM’s Vehicle Deliveries by Region
The chart above shows GM’s vehicle deliveries breakdown into several business segments or regions such as GM North America (GMNA), GM International (GMI) and GM Europe (GME).
According to the chart, GMNA has been the largest vehicle sales contributor to the company between 2014 and 2020, delivering on average more than 800,000 vehicles to GM on a quarterly basis.
As of 1Q 2020, GMNA’s wholesale vehicle deliveries of 775,000 units made up as much as 80% of total vehicle deliveries for the company whereas GMI contributed only 191,000 units to GM during the same quarter.
Take note that GM has sold off its GME subsidiary in 2017 and therefore, the vehicle sales data from the European region has ceased to exist by the end of 2017.
Although the North America region has been the largest automobile market for GM, the 1Q 2020 vehicles sales recorded from this region was one of the worst quarter ever in which vehicle deliveries was below the average of 800,000. Moreover, GM North America’s wholesale vehicle deliveries of 775,000 units represents a year-over-year decline of -9.8%.
Similarly, GMI also experienced one of the worst quarter ever in 1Q 2020 with vehicle deliveries at only 191,000 units, which was about -19.1% lower compared to the same quarter a year earlier.
In short, GM has been having weak vehicle delivery not only in the North America region but also in global markets such as China and South America, with the international market being the worst performer in 2020.
Chart of GM’s Vehicle Deliveries and Automotive Revenue
The chart above shows GM’s vehicle deliveries and the respective automotive revenue extracted from the income statements.
The automotive revenue is the revenue recognized from the sales of vehicle and thus should correlates closely with GM’s vehicle deliveries. For this reason, I have put together the vehicle delivery numbers and the respective revenue into the same chart to illustrate the effect of vehicle delivery on automotive revenue.
As seen from the chart, GM’s automotive revenue correlates closely with the vehicle delivery figures, not only in the trend of the plot but also in the magnitude of the slope. For instance, when vehicle deliveries declined to its lowest level in 4Q 2019, so did automotive revenue which was seen dropping to its lowest level at roughly $27 billion.
Similarly, when GM’s vehicle sales rose slightly in 1Q 2020 compared to the prior quarter, automotive revenue follows suit and hit $29 billion in the same quarter which represents a sequential growth of about 7%.
When such a close correlation occurs, GM’s wholesale vehicle deliveries will directly affect the revenue of the company and possibly its quarterly dividends which have been paid out continuously since 2014 if vehicle deliveries were to take a hit.
Furthermore, GM’s automotive revenue has contributed close to 90% of sales to total revenue in most quarters as seen in this article: GM revenue streams. If GM’s wholesale vehicle sales continued to plunge in the coming quarters in 2020, the company’s total revenue will certainly be affected and this may lead to the suspension of the dividends payout which has in fact, occurred when GM has suspended the dividend in Q2 2020.
Chart of GM Worldwide Vehicle Deliveries Sequential Growth Rate
The chart above shows GM’s quarterly growth rate of wholesale vehicle sales for the last 5 years from 2015 to 2020.
The chart illustrates that GM’s wholesale vehicle deliveries have taken a serious hit in both 3Q and 4Q 2019, plunging by as much as -8.5% and -7.8% respectively. However, sequential growth recovered to positive growth rate of 1.5% in 1Q 2020 when vehicle deliveries increased slightly to 966k units in the same quarter.
Other than these quarters, 3Q 2017 was also one of the worst hit period in terms vehicle sales over the last 5 years when the respective quarterly sales severely dropped -22.6%. As mentioned, the vehicle deliveries plunged more than 300,000 units in this quarter alone.
Part of the reason for the huge decline was probably related to the sales of GM European subsidiary to PSA group in 2017.
The average quarterly growth rate for vehicle sales for the last 5 years was -1.4%, indicating that GM’s sequential vehicle deliveries has actually declined throughout the shown period.
Chart of GM Worldwide Vehicle Deliveries Year Over Year Growth Rate
The chart above shows the year over year growth rate of GM’s wholesale vehicle for the past 5 years between 2014 and 2020.
As the chart shows, YoY growth was the worst affected during 2017 and 2018 when YoY figures of more than -20% were reported in 4 consecutive quarters. Subsequently, there has been no positive YoY growth reported for wholesale vehicle deliveries since 2018 which means that GM’s wholesale vehicle sales have continued to plummet comparatively.
In 1Q 2020, wholesale vehicle sales plunged double-digits at -11.8% when vehicle deliveries were lower by more than 100,000 units compared to the same quarter a year ago, illustrating that GM’s vehicle sales has been getting hit not only in 2019 but also 2020. The poor sales will likely continue all the way to the end 2020 and possibly 2021 considering that there is still no end in sight for the COVID-19 outbreak.
In average, year over year growth rate for vehicle sales the past 5 years was roughly -6.6%, which was much worse than the sequential figure of only -1.4%.
GM’s vehicle deliveries data is comprised of two types: (1) Wholesale vehicle sales and (2) Total vehicle sales. The difference between them is that the wholesale vehicle sales correlates to revenue while the latter does not.
The vehicle deliveries data shown in this article are those from wholesale vehicle sales which correlates to revenue recognized in the income statements.
Over the past 5 years, GM’s vehicle deliveries have trended down significantly with the highest figure recorded in 4Q16 at 1,653,000 vehicles and the lowest figures at 952,000 vehicles in 4Q19.
GM reported one of the worst quarters in 1Q 2020 when wholesale vehicle deliveries were only 966,000 units, with GM North America delivering 775,000 vehicles compared to only 191,000 vehicle deliveries from GM International.
The declining wholesale vehicle deliveries has directly impacted GM’s automotive revenue and the dividend suspension will persist if things have not improved in the coming quarters in 2020 and 2021.
References and Credits
1. Financial data in all charts in this article were obtained and referenced from data available at General Motors Investor Relation.
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