NEW YORK (CNNMoney) — General Motors’ third-quarter earnings were hit hard by the shortage of key chips, which are used in nearly all of its vehicles.
The Detroit-based automaker said on Thursday that third-quarter earnings will be significantly below its 2018 third-quarter earnings, which will be $1.40 per share. GM said it expects adjusted earnings to be between $1.00 and $1.10 a share.
GM reported a net profit of $2.3 billion in the third quarter of last year.
The company has been grappling with a shortage of key chips for GPS navigation, audio and the radio, known as the LiDAR system.
“We are seeing customer demand for our customer-focused products and our dedicated dealer networks but this quarter results did not reflect those efforts,” said CEO Mary Barra.
GM confirmed its previously announced guidance of record earnings in 2019.
GM lost a minor ruling in its international trade dispute with China earlier this week. The United States agreed to suspend duties on some Chinese imports after GM agreed to invest $1.2 billion in a subsidiary in China.
The automaker also announced that it’s launching its recall of some of its most popular models, including some SUVs and compact sedans. The vehicles had been recalled last year, but were never actually repaired. GM said more than one million vehicles will be affected.
GMC launched a new SUV, the Acadia, earlier this year and was pleased with its sales but still thought it needed to repair the affected vehicles.
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