During the fourth-quarter financial results conference call the largest US automaker unveiled a much-awaited move – to increase dividends by 20 percent.
But, according to the company’s chief financial officer, General Motors might be ready to return even more cash to its shareholders later in 2015, with Chuck Stevens disclosing in a Reuters interview that further capital return might become possible as soon as legal issues surrounding a major recall are settled. Last year in February GM became involved in a massive scandal after recalling 2.6 million cars equipped with defective ignition switches at least a decade later than it should have – with the faulty parts tied now to at least 51 fatalities in related crashes. “As we get more clarity on those open items, I would expect that we would continue to evaluate further return of capital to shareholders and that could happen as soon as the second half of this year,” he told Reuters.
GM currently wants to carry the high end of its targeted cash range of $20 billion to $25 billion and the planned increase, set to increase the company’s yearly outlay for dividends to around $2.4 billion comes as the group had very positive results last year and is forecasted to post an even stronger performance in 2015. General Motors swiftly emerged from government-sponsored bankruptcy back in 2009, managing to catch the wave of the US auto industry rebound. Today, total liquidity of the company has surged to almost $40 billion thanks to high sales of high-margin pickups and sport utility vehicles.