Raphael Stevens

General Motors CEO Mary Barra blamed a supplier of automation equipment for the slow ramp-up of its new electric vehicles.
The automaker produced just 50,000 units through the first half of this year.
Forthcoming EVs will eventually include a next-generation version of the Chevrolet Bolt EV, GM said.

GM Chair and CEO Mary Barra addresses investors Oct. 6, 2021 at the GM Tech Center in Warren, Michigan.
Photo by Steve Fecht for General Motors

DETROIT — General Motors CEO Mary Barra on Tuesday blamed a supplier of automation equipment for the slow ramp-up of GM’s new electric vehicles, after Wall Street criticized the rollout amid bold predictions the company would catch up to industry leader Tesla.
Shares of GM were down roughly 4% in morning trading Tuesday despite quarterly results that topped year-ago performance. Analysts during the call questioned the company’s pricing strategies, EV profitability guidance and ability to hit previously announced targets for the vehicles.

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“We have experienced unexpected delays in the ramp because our automation equipment supplier has been struggling with delivery issues that are constraining module assembly capacity,” Barra said during the company’s second-quarter earnings call Tuesday.
GM produced 50,000 EVs through the first half of this year for North America, in line with internal targets but far slower than many expected. A majority of that production was its outgoing Chevrolet Bolt models, rather than new EVs that utilize the automaker’s “Ultium” batteries and technologies.
Barra, a former plant manager and auto engineer, said she has been “disappointed” with the unnamed supplier and that she has personally been involved with problem solving and updating the automated lines. She said GM was “surprised” how little progress the supplier had made.
The automaker expects significant improvements in production through the end of this year, Barra said, with constraints “primarily” being behind the company by then, if not sooner.
“We’ve already seen a lot of improvement from, I’ll say, you know, the last four to six weeks; we’re going to continue on that path,” Barra said.

Despite the holdup with the battery modules, which house the vehicles’ battery cells, Barra said the company still plans to produce 100,000 vehicles in North America during the second half of this year, leading to 400,000 cumulative vehicles produced by mid-2024.
“We’re not walking away from any of the targets we put out,” Barra said.

Reviving the Bolt

Those forthcoming EVs will eventually include a next-generation version of the Chevrolet Bolt EV, GM said.
In April, GM said it would end production of the mainstream Bolt EV models by the end of this year to transfer production of the plant where it’s produced to electric trucks.

A Chevrolet Bolt EUV on display at the New York Auto Show, April 13, 2022.
Scott Mlyn | CNBC

Barra said plans to build a next-generation Bolt follow increased consumer demand for the vehicles after significant price cuts last year that made the vehicles the least expensive EVs in the U.S.
Barra said GM will be updating the vehicle with technologies from its new battery and software programs, known respectively as Ultium and Ultifi.
GM declined to release additional details about the next-generation Bolt, such as timing, price and production location. More

General Motors is raising its 2023 guidance for a second time this year after the automaker reported second-quarter results Tuesday that were up sharply year over year.
The Detroit automaker also said it is increasing cost-cutting measures through next year and now plans to cut $3 billion in expenditures compared with previous guidance of $2 billion.
GM’s earnings included an unexpected $792 million charge for new commercial agreements between GM and LG Electronics and LG Energy Solution.

Mary Barra, CEO, GM at the NYSE, November 17, 2022.
Source: NYSE

DETROIT — General Motors is raising its 2023 guidance for a second time this year after the automaker reported second-quarter results Tuesday that were up sharply year over year.
The Detroit automaker also said it is increasing cost-cutting measures through next year and now plans to reduce $3 billion in expenditures compared with previous guidance of $2 billion.

GM CFO Paul Jacobson said the reductions will include sales and marketing spending, salary employment, and other costs.
GM shares were initially up following the results but were down by more than 2% in premarket trading ahead of markets opening.
Here’s what GM reported for its second quarter:

Adjusted earnings per share: $1.91. (This is not comparable to $1.85 analysts expected due to one-time items.)
Revenue: $44.75 billion vs. $42.64 billion expected, according to Refinitiv consensus estimates

GM’s earnings included an unexpected $792 million charge for new commercial agreements between GM and LG Electronics and LG Energy Solution. The cost is a result of the automaker sharing costs with the companies for a recall of its Chevrolet Bolt EV models in recent years, which were previously expected to be paid by the LG companies.
Taking that charge into account, the company reported adjusted earnings before interest and taxes of $3.23 billion.

On an unadjusted basis, the company reported net income attributable to stockholders of $2.57 billion, or $1.83 per share, up nearly 52% from a year earlier when it earned $1.69 billion, or $1.14 per share.
Revenue during the quarter jumped 25% compared to $35.76 billion a year earlier.
For the full year, GM is raising its adjusted earnings expectations to a range of $12 billion and $14 billion, up from a previous range of $11 billion to $13 billion. GM also raised expectations for adjusted automotive free cash flow to a range of $7 billion and $9 billion, up from $5.5 billion and $7.5 billion, and for net income attributable to stockholders of $9.3 billion to $10.7 billion, compared to the previous outlook of $8.4 billion to $9.9 billion.
Jacobson said the raise is a result of stronger-than-expected pricing, demand and capital discipline.
However, the guidance raise is contingent on GM successfully negotiating new labor agreements with the United Auto Workers and the Canadian Unifor unions this year without a work stoppage or strike. The UAW has new leadership that has publicly been far more confrontational than prior union officers. The current contracts covering roughly 150,000 union workers for the Detroit automakers are set to expire Sept. 14.
“We have a long history of negotiating fair contracts with both unions that reward our employees and support the long-term success of our business. Our goal this time will be no different,” GM CEO Mary Barra said Tuesday in a shareholder letter. “That’s the best possible outcome for all our key stakeholders, including our team, plant communities, dealers, suppliers and investors.”
A work stoppage would add to the auto industry’s yearslong production problems results from the coronavirus pandemic and significant supply chain constraints such as semiconductor chips.
During the last round of bargaining in 2019, a breakdown in negotiations between the Detroit automakers and UAW led to a national 40-day strike against GM. The automaker has said the strike cost it about $3.6 billion that year.
For GM specifically, a work stoppage could cost it hundreds of millions of dollars a week and delay the production ramp-up of its new electric vehicles, which the automaker has already been slow to produce. Jacobson said GM achieved North American production of 50,000 EVs during the first half of the year, however acknowledged “it’s been a little bit challenging.”
He said the automaker will disclose more about the slow production of its new EVs during an analyst call Tuesday.
Prior to reporting results Tuesday, GM’s earnings beat expectations 86% of the time, according to Bespoke. However, the stock only averages a 0.17% gain on earnings day.
Shares of GM are up roughly 16% this year. They closed Monday at $39.30 per share — off from a 52-week high of $43.63 per share, notched in February. More

The Biden administration wants to push health insurance plans to offer patients better access to mental health care and substance abuse treatment.
A proposed rule would require insurers to add therapists and other services if an evaluation finds they are not complying with the Mental Health Parity and Addiction Equity Act.
Insurance plans often do not provide enough therapists in network, which requires patients to seek care out of network and pay more for their health care.

A young woman sits on a couch with her therapist.
Sdi Productions | E+ | Getty Images

The Biden administration plans to crack down on health insurance plans that discriminate against people who need mental health care and substance abuse treatment.
A proposed rule published Tuesday by the Health and Human Services, Labor and Treasury departments aims to push health insurers to comply with the Mental Health Parity and Addiction Equity Act.

That law, which was passed in 2008, requires insurance plans that cover mental health care and substance abuse treatments to offer the same level of coverage for these services as they do for other illnesses.
White House domestic policy advisor Neera Tanden told reporters in a call Monday that too many insurers are evading the law and making it difficult for patients to access mental health care.
Insurance plans often do not provide enough therapists in network, which forces patients to seek care out of network and pay more. Patients also often have to get permission from their insurer to seek treatment or have their claims denied leaving them with the bill.
“This has meant millions of people who have insurance are paying out of pocket when they shouldn’t have to,” Tanden said.
More than 1 in 5 adults in the U.S., or 58 million people, live with a mental illness, according to the National Institute of Mental Health.

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The proposed rule would require insurance plans to evaluate how their coverage policies impact patients’ access to mental health and substance abuse treatment, Tanden said.
Insurers would be required to take action if they are not in compliance with the law, she said. This could include adding more therapists to the insurance network if patients are seeking care out of network too often, Tanden said.
The proposed rule will undergo a 60-day public comment period before it is finalized.
A survey published in July of nearly 2,800 patients found that people with insurance face more challenges accessing mental health services than other types of medical care.
Nearly 40% of people enrolled in insurance through their employer had to seek more costly mental health care or substance abuse treatment out of network, according to the survey conducted by the research institute NORC. By comparison, 15% of people seeking physical health care went out of network.
More than 50% of patients reported that their insurance denied coverage three or more times for mental health or substance abuse services, compared with 33% who reported the same for physical health care.
And nearly 60% of those surveyed who sought mental health care or substance abuse treatment did not receive any care in at least one instance. More

Biogen said it expects to axe 1,000 jobs, or about 11% of its workforce, to save costs as the biotech company prepares to launch its newly approved Alzheimer’s drug Leqembi.
The layoffs are part of an ongoing cost-cutting plan, which also involves shaving down the company’s research and development pipeline to prioritize Leqembi and other drugs. 
Biogen, in its second-quarter earnings report, said the plan will result in $700 million in net operating expense savings by 2025. 

A Biogen facility in Cambridge, Massachusetts.
Brian Snyder | Reuters

Biogen on Tuesday said it expects to cut approximately 1,000 jobs, or about 11% of its workforce, to save costs as the biotech company prepares to launch its newly approved Alzheimer’s drug Leqembi.
It’s the latest round of layoffs after Biogen slashed nearly 900 jobs last year. Biogen had 8,725 employees worldwide as of the end of 2022.

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The job cuts are also part of the company’s ongoing cost-cutting and reorganization plan, which also involves shaving down its research and development pipeline to prioritize Leqembi and other drugs. Biogen, in its second-quarter earnings report, said that R&D pipeline prioritization is “substantially complete.”
The larger plan is expected to generate approximately $1 billion in gross operating expense savings by 2025, according to Biogen.
About $300 million of those savings will be reinvested into product launches and R&D programs. 
The company also said the plan will result in $700 million in net operating expense savings by 2025. 
Biogen’s stock price rose more than 1% in premarket trading Tuesday. 

The new layoffs follow landmark approvals of Leqembi and the company’s ALS drug Tofersen this year.
Investors are pinning their hopes on the new medicines as Biogen’s blockbuster multiple sclerosis and spinal muscular atrophy treatments face fierce competition from cheaper versions and similar drugs. 
Biogen CEO Chris Viehbacher said during an earnings call that the cost-cutting plan is “an opportunity really to make sure that this year, before we get into the product launches, that we are truly fit for growth.” 
“There are an awful lot of patients who depend on Biogen products,” he said during the call. “There’s a need, obviously, to have a strong investment in our new product launches. It’s important, clearly, to manage costs, but shareholder value is most optimized if we can really make a success of these launches.”
Wall Street analysts were pleased with the layoff announcement.
Wells Fargo analyst Mohit Bansal said in a Tuesday research note that the broader cost-cutting plan is “in line with our expectations and was the reason for our bullish stance on the name.”
“We expect the stock to be up on this news as investors were waiting for this move,” he said.
Biogen on Tuesday also reported second-quarter revenue and adjusted earnings that topped Wall Street’s estimates. 
Biogen posted $2.46 billion in revenue for the quarter, down 5% from the same period a year ago. Analysts had expected second-quarter sales of $2.37 billion. 
The company reported net income of $591.6 million, or $4.07 per share. Excluding certain items, adjusted earnings per share were $4.02 for the period. Analysts had expected adjusted earnings of $3.77 per share.
Biogen also reiterated its full-year guidance. The company is forecasting a “mid-single digit percentage decline” in 2023 revenue compared with last year, and full-year adjusted earnings of $15 to $16 per share. More

Warner Bros.’ “Barbie” tallied around $155 million during its first three days in theaters, the highest opening of 2023.
Universal’s “Oppenheimer” snared $82.4 million during its debut.
Analysts expect this weekend to be the highest-grossing weekend of the year at the domestic box office.

“Barbenheimer” exploded over the weekend, generating more than $235.5 million in ticket sales and reinvigorating the domestic box office.
“Barbie” tallied around $155 million during its first three days in theaters, the highest opening of 2023. Its counterpart “Oppenheimer” made $82.4 million over the weekend, according to numbers released Monday.

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“I don’t think anyone could have reasonably predicted this kind of confluence between ‘Oppenheimer’ and ‘Barbie,'” said Shawn Robbins, chief analyst at BoxOffice.com. “If you’re going to a theater right now, the communal experience is reminiscent of major Marvel and Star Wars films, but without those franchises remotely involved.”

Cillian Murphy in Oppenheimer and Margot Robbie as Barbie
Julien De Rosa | AFP | Getty Images; Stuart C. Wilson | Getty Images

More than 18.5 million tickets were bought for the combination of Warner Bros.’ “Barbie” and Universal’s “Oppenheimer,” 12.8 million for “Barbie” and 5.8 million for “Oppenheimer,” according to data from EntTelligence.
“It was a truly historic weekend and continues the positive box office momentum of 2023,” said Michael O’Leary, president and CEO of the National Association of Theatre Owners. “More importantly, it proves once again that America loves going to the movies to see great films.”
Both films hold a rating of more than 90% “Fresh” on Rotten Tomatoes and inspired moviegoers to dress head-to-toe in pink or don suits and hats during their screenings.
“People recognized that something special was happening and they wanted to be a part of it,” O’Leary said. “Our partners in the creative community and at the studios gave audiences two uniquely different, smart and original stories that were meant for the big screen and movie lovers responded by gathering friends and family and heading to their local movie houses across the nation.”

With additional ticket sales from Paramount’s newest “Mission Impossible” film, Sony’s “Spider-Man: Across the Spider-Verse” and Angel Studios’ “The Sound of Freedom,” the weekend box office is expected to reach $302 million, the highest of any weekend in 2023, according to data from Comscore.
“The unprecedented performance of these two films, and the boost it gave to the overall movie marketplace, solidified the movie theater as a cultural hub and epicenter of social interaction,” said Paul Dergarabedian, senior media analyst at Comscore.
“Barbenheimer” weekend is currently set to be the fourth-highest weekend haul of all-time, just below the three-day stretch when Disney’s “Star Wars: The Force Awakens” arrived in theaters in December 2015 and helped boost the overall weekend haul to $313 million. The second-highest is $314 million from April 2018’s opening weekend of “Avengers: Infinity War.”
Some box office analysts project that Monday’s official weekend numbers could be quite a bit higher than Sunday’s estimates, and push “Barbenheimer” weekend up the charts. However, they won’t come close to the highest-grossing weekend ever, which occurred in April 2019 when “Avengers: Endgame” hit theaters, drumming up $357 million on its own, and leading to a $402 million overall weekend tally.
The success of “Barbenheimer” comes at a time when the domestic box office has faced some hurdles. A slew of adult-aimed blockbusters have underperformed, leading many in the industry to question if consumer tastes have shifted away from Hollywood.
Warner Bros.’ “The Flash” has fizzled, Pixar’s “Elemental” failed to lure in family audiences and even the return of Harrison Ford as Indiana Jones wasn’t enough to pack cinemas.
However, the combination of bombs and blonde bombshells seems to have inspired plenty of moviegoers to leave their couches for the cinema.
“It’s a historic result that showcases the enthusiasm audiences have for a variety of fresh content,” Robbins said. “These films have exquisitely tapped into the cultural zeitgeist. They’ve reignited the summer box office flame, and they’ve proven that studios can be a little more aggressive with counter-programming strategies in the future.”
Disclosure: Comcast is the parent company of NBCUniversal and CNBC. NBCUniversal is the distributor of “Oppenheimer” and owns Rotten Tomatoes.
For more, check out CNBC Select’s story on how to save money on movie tickets. More