REACTION: The 'right call' to go for price over pickup share
A roundup of what analysts and others are saying about General Motors' first-quarter financial results:
"GM faced a full-court press from Ford incentives and Ram marketing initiatives. But the strong result in North America was largely driven by $1.7 billion of pricing, indicating that GM may have made the right call to go for price over share in that category. In addition, GM enjoyed strong equity income from China on the back of 13 percent unit sales growth, and lower losses in Europe – a trend in both markets that GM expects to continue for the year. There are still uncertainties in the road ahead ... We continue to expect a gradual recovery in Europe, South America continues to exhibit macro risk, and the U.S. large pickup segment remains volatile."
-- Barclays analyst Brian A. Johnson
“Some investors are probably wiping their brow that it wasn’t a loss and thinking this is probably the worst quarter for these issues.”
-- Christian Mayes, an analyst with Edward Jones
“It's unfortunate that General Motors' most competitive product line in decades is being overshadowed by recall headlines. Clearly the ghosts of GM's past haven't all been put to rest. The automaker has made exceptional progress since the restructuring five years ago, but today's ultra-competitive global car market leaves little room for error, and the cost of the recall will have a substantial impact on near-term financials.”
-- Karl Brauer, senior analyst for Kelley Blue Book
"It should be good enough to ease concerns. Expectations were very low. People were just kind of nervous overall about how the quarter would look. The story really here though, in terms of fundamentals, is better performance in the international regions."
-- Citi analyst Itay Michaeli
"While GM set a low bar for 1Q results, something positive to stem the tide of negative news flow is the real value here: The auto industry is a hard enough business without the constant barrage of negative headlines related to high-profile recalls. Like many of its peers, GM faces real strategic challenges as the U.S. cycle peaks, making us sympathetic with the market’s low valuation of the shares. Within GM, there are some great (China, trucks) and recovering businesses (Europe) that can drive some surprises along the way."
-- Morgan Stanley analyst Adam Jonas
Bloomberg and Reuters contributed to this report.