) reported a 15% year-on-year increase in total revenues for Q1
2011. GM's North America (NA) operations is the largest
contributor to its total revenues, accounting for almost 60% in
Q1. In this article we take a look at major trends that emerged
in the past quarter that affect revenue generation in North
America. GM competes with other global automakers
like Ford (
), Daimler AG (NYSE:DAI), Honda (NYSE:HMC), Toyota
(NYSE:TM), Hyundai (SEO:005380) and Nissan (
We currently have a
price estimate of $34.95 for General Motors's
, implying upside to market price. We estimate that GM's North
American automotive division (cars and trucks together)
contributes about 31% of its stock value.
Vehicle Sales Benefit from Successful Product Launches
and Economic Improvement
Revenues from increased wholesale vehicle sales (up $2.7
billion) contributed to the bulk of increased revenue generation
in North America. An improving economic climate, higher consumer
confidence and recent vehicle launches helped GM's retail vehicle
sales in NA in Q1 grow by 21% year-on-year.
GM's product-engineering and marketing focus on its four core
brands - Chevrolet, Cadillac, Buick and GMC helped drive demand
for products such as Chevrolet Cruze, GMC Terrain, Buick LaCrosse
and Cadillac SRX. Sales promotions as well as leases and loans
offered through GM Financial also contributed to this increase.
New GM vehicles accounted for almost 40% of leases and loans
offered by GM Financial in Q1 2011, a number we expect to
increase over our forecast horizon.
Due to greater vehicle sales volumes, GM recorded increased
revenues of around $0.2 billion from services such as OnStar,
Customer Care and after-sales. This was offset by increased sales
allowances ($0.3 billion increase) to drive vehicle sales.
You can drag the trend lines in the modifiable charts
above to see the impact of these trends on GM's stock value.
See our complete analysis of GM stock here