GM may consider divided payment in 2014, says CEO

Article by Christian A., on December 18, 2013

General Motors Co. is in a better position to consider a dividend payment in 2014, thanks to improved cash flow and fewer outstanding preferred shares, according to outgoing chief executive Dan Akerson. “We’re producing a fair amount of cash now, too, and we’ve improved our balance sheet by buying back yield-based securities, so I think it does give us more bandwidth to consider it,” Akerson told reporters following a presentation at the National Press Club in Washington D.C.

Harry J. Wilson, a member of the United States auto task force that helped rebuild GM in its 2009 bankruptcy, has remarked that activist investors may press for more dividend payouts or stock buybacks.

Akerson's remarks came after GM disclosed plans to invest $1.3 billion to upgrade five factories in the US, on top of the $1.5 billion already announced this year. The new plan also came following a disclosure that the U.S. Treasury had sold its remaining stake in GM, thereby totally freeing the carmaker from US government ownership.

Akerson also disclosed that he will retire in January 2014, with Mary Barra succeeding him. Akerson has recently been very active in continuing efforts to further build GM. In September, GM announced an effort to buy around half of the UAW retiree health-care trust’s preferred shares that paid a 9-percent annual interest, replacing it with a bond offering. GM also introduced 18 new or revamped models in the US this year, with plans for 14 more introductions in 2014.

Topics: gm, ceo

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