Analyst Note
| David Whiston |GM finished 2022 with an excellent fourth quarter and introduced 2023 guidance well above the Refinitiv consensus. We are not changing our fair value estimate but will revisit all modeling assumptions shortly when we roll our model forward for the 10-K. The market’s fears of macroeconomic factors hurting GM’s pricing and demand have not yet materialized, and management said January remained strong like 2022’s performance. The company does expect GM North America pricing to be a negative headwind as 2023 unfolds, which makes sense given the chip shortage has led to incentives and inventory at very low levels that we feel will only rise over time. Volume and mix should net to be slightly positive to adjusted EBIT, with mix being negative on a tough comparable to light truck’s popularity in 2022, and cost recoveries given to suppliers should offset most of the benefit from declining commodity costs.