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GM suspends 2020 outlook, but 'confident' in its fiscal stability

GM suspends 2020 outlook, but 'confident' in its fiscal stability
Shares of GM climbed by 8 percent in early trading on Tuesday after the announcement. File Photo by Brian Kersey/UPI | License Photo

March 24 (UPI) -- U.S. auto giant General Motors said Tuesday it plans to draw down $16 billion from revolving credit facilities and suspend its 2020 outlook as proactive measures to cushion the impact of the coronavirus outbreak.

The automaker said the money will supplement its cash position of between $15-$16 billion that's expected at the end of March.

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"We are aggressively pursuing austerity measures to preserve cash and are taking necessary steps in this changing and uncertain environment to manage our liquidity, ensure the ongoing viability of our operations and protect our customers and stakeholders," General Motors CEO Mary Barra said in a statement.

"Over the past several years, we have made necessary, strategic decisions and structural changes that have transformed the company and strengthened the business, better positioning us for downturns."

Shares of GM climbed in early trading Tuesday after the announcement.

GM Financial, its financial services arm, had $24 billion in liquidity at the end of 2019 and expects to end the first quarter at a similar level, the company said.

"We are confident that we will be able to navigate the challenges created by this environment," said GM Financial President Dan Berece.

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Due to the outbreak, GM is planning to close its North American factories until at least March 30.

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