...May 5, 2021 NEW YORK (S&P Global Ratings) May 5, 2021--S&P Global Ratings today said that General Motors Co.'s (GM; ###/Negative/--) first quarter performance was better than we had expected. Increased pricing and lower costs helped offset the effects of the semiconductor-related production shortfalls. As a result, our base case for the company (after incorporating our estimate for a $2.5 billion decline in its EBIT stemming from the ongoing semiconductor chip shortage) now assumes EBITDA margins remain above 8% and free operating cash flow (FOCF) to debt is positive (after $9 billion-$10 billion in capital expenditures) in 2021 and exceeds 15% in 2022 while the company sustains debt to EBITDA of well under 2.5x (below our 3.0x downside trigger). Some factors that support our forecast include steady progress toward $4.5 billion in transformation savings, as well as a solid product mix with several new offerings across segments and regions that should support improved pricing. Continued...
