Detroit automaker General Motors reported a pre-tax profit of over $9 billion in North America for 2020, despite an industry-wide slowdown of car sales due to the coronavirus pandemic and even a 40-day union strike which cut into the company’s third- and fourth-quarter earnings.
“Despite a year of a pandemic and loss of production in 2020, General Motors reported a solid profit for North America,” said Terry Dittes, CEO of the General Motors Department of the United Auto Workers union in statement. “This is a testament to our UAW-GM Membership, who produce some of the finest and most sought-after vehicles in the world, right here in the U.S.A.”
That’s not just talk – GM sold 6.8 million vehicles globally in 2020, more than any other company save Honda, and made a strong incursion into the market for commercial electric vehicles.
GM, which employs 44,000 UAW members as hourly workers, offers profit-sharing as an employee benefit. For every billion dollars the company makes in North America in a financial year, eligible employees each get a little more than $1,000. In 2019, that meant employees took home a bonus check of $8,000. In 2018, a good year for cars, it was over $10,000. This year, with slightly better terms in the 2020 union contracts, it’s estimated to be above $9,000.
GM made profit-sharing the norm for auto manufacturers in the U.S., and it continues to draw talent to the company. In 2021, the goal is to exceed $10 billion in North American profits again, like they did in 2018, which would again mean a check of over $10,000 for GM’s union employees.
For comparison, in 2019, Ford paid out a profit share averaging $3,600 and Fiat Chrysler employees averaged $7,300, both using the same formula. Both companies have a little catching up to do.
Photo: Trucks come off the assembly line at GM’s Chevrolet Silverado and GMC Sierra pickup truck plant in Fort Wayne, Indiana. Credit: John Gress Media Inc / Shutterstock.com