DETROIT – The General Motors Board of Directors has approved a 3-cent-per-share increase in the quarterly common stock dividend rate beginning with the next planned dividend, as well as a new $6 billion share repurchase authorization.
The company has entered into an accelerated share repurchase program to execute $2 billion of the share repurchase authorization.
“The GM team’s execution continues to be strong across all three pillars of our capital allocation strategy, which are to reinvest in the business for profitable growth, maintain a strong investment grade balance sheet and return capital to our shareholders,” Mary Barra, GM chair and CEO, said in a news release. “We are growing our business thanks to our broad, deep and compelling portfolio of ICE vehicles and EVs. At the same time, we are investing our capital in a disciplined and consistent way to continue generating strong margins and cash flows.”
The company reported last month that capital spending in 2025 is expected to be $10 billion to $11 billion, inclusive of investments in the company’s battery cell manufacturing joint ventures. Spending on research and product development is expected to be more than $8 billion.
The new quarterly dividend rate of 15 cents per share represents a 3-cent-per-share increase from the previous quarterly dividend of 12 cents per share. It will take effect with the company’s next planned dividend, which is expected to be declared in April.
“We feel confident in our business plan, our balance sheet remains strong, and we will be agile if we need to respond to changes in public policy,” said Paul Jacobson, GM executive vice president and CFO. “The repurchase authorization our board approved continues a commitment to our capital allocation policy.”
The share repurchase program, which has no expiration date, will be executed in accordance with applicable securities laws and regulations and may be suspended or discontinued at any time at the company’s discretion, the release states.
Through the ASR program, GM will advance an aggregate of $2 billion to the executing banks to receive and retire GM common stock. The total number of shares ultimately repurchased under the ASR program will be determined upon final settlement and will be based on the average of the daily volume-weighted average prices of GM’s common stock during the term of the program, the release states. The ASR program is expected to conclude in the second quarter of 2025.
Pictured at top: A General Motors logo is displayed outside the General Motors Detroit-Hamtramck Assembly plant in Hamtramck, Mich., on Jan. 27, 2020. (AP Photo | Paul Sancya, File)