General Motors Co. (NYSE:GM)

Inventory turnover

The inventory turnover ratio exhibits fluctuation over the periods analyzed. Starting from 9.53 in March 2020, it declined to lows around 6.33 in September 2022, indicating slower inventory movement during this period. However, a gradual recovery is seen thereafter, rising to 10.37 by March 2025, which suggests improved inventory management and faster stock turnover in the most recent quarters.

Receivables turnover

This ratio shows variability with notable declines and recoveries. It started at 13.52 in March 2020, dipped significantly to around 9.6 to 9.82 in mid to late 2022, which may indicate slower collection of receivables during that timeframe. From late 2022 onwards, the ratio gradually improves back to 13.38 by early 2025, reflecting enhanced efficiency in collecting receivables.

Payables turnover

The payables turnover ratio remains relatively stable, fluctuating within a moderate range between approximately 4.15 and 5.88. There is a slight upward trend towards the end of the analyzed period, reaching around 5.65 to 5.88 by early 2025, which suggests a tendency toward quicker payment of payables in recent quarters.

Working capital turnover

Working capital turnover shows significant volatility. It started at an extraordinarily high level of 107.17 in early 2020, then plunged to much lower levels, fluctuating between 8.36 and 21.98 in subsequent quarters. The declined levels through mid-2024 imply less efficient use of working capital during much of this timeframe. Although some quarterly recoveries occur, the overall trend points to challenges in managing working capital efficiently.

Average inventory processing period

The average inventory processing period fluctuates between 35 and 58 days, peaking around 58 days in late 2022, implying slower inventory turnover during that time. Post-2022, the period generally shortens to mid-30s by early 2025, indicating faster inventory processing and potentially improved inventory management efficiency.

Average receivable collection period

The receivable collection period shows moderate fluctuations, ranging mostly between 24 and 38 days. Higher values, such as 38 days in late 2022, suggest slower collections. However, a pattern of reduction to around 27 days by early 2025 is noticeable, signifying improved collection speed in recent quarters.

Operating cycle

The operating cycle experiences notable variation, starting around 65 days in early 2020 and increasing to the 80-96 day range in 2021 and 2022, indicating a lengthening of the cycle. More recent quarters show a reduction toward the low 60s by early 2025, suggesting better overall operational efficiency and quicker turnover of inventory and receivables combined.

Average payables payment period

The payables payment period generally shows a downward trend from high 70s and nearly 90 days in mid-2022, to around 62-65 days by early 2025. This decrease denotes the company is paying its suppliers faster in recent periods compared to previous years.

Cash conversion cycle

The cash conversion cycle exhibits significant fluctuation, with negative values in early periods (as low as -10 days), implying the company collects cash from customers faster than paying suppliers, which is generally positive. Subsequently, values shift closer to zero and then slightly positive towards the end of the period, ranging between 2 and 8 days, indicating a slight lengthening but overall maintained effectiveness in cash management over the years.

Automotive and other cost of sales

The cost of sales exhibits significant volatility over the analyzed periods, with notable fluctuations in quarterly amounts. A sharp decline is observed in the second quarter of 2020, likely reflecting pandemic-related disruptions, followed by a rebound and general upward trend through most quarters.

From 2021 onwards, the costs generally increase, peaking in several quarters such as late 2022 and mid-2024, indicating rising expenses or increased production activity. However, some quarters witness declines suggesting either cost containment measures or variations in production volume.

Overall, the data shows a pattern of recovery and growth in costs after the initial low, potentially signaling normalization in operations and increased demand or inflationary pressures on expenses.

Inventories

Inventory levels show a mixed pattern with an upward trend noticeable in parts of 2021 through 2023, peaking around mid-2023. This could suggest stockpiling, possible supply chain challenges, or anticipation of higher sales.

After reaching high points in 2023, inventory values decrease somewhat towards the end of the dataset, possibly indicating improved turnover or adjustments in stock management strategies.

Earlier quarters, especially in 2020, show relatively stable inventory figures despite external pressures, reflecting maintained supply chain management amid uncertain conditions.

Inventory turnover ratio

The inventory turnover ratio demonstrates some variability but generally remains within a narrow band between approximately 6.3 and 10.4 over the reported periods.

There is a notable low around late 2020, coinciding with higher inventory values and cost fluctuations, implying slower movement of stock during that time.

Subsequent years show an improving turnover ratio, with spikes in early and late 2024 that suggest increased efficiency in inventory management or stronger sales relative to inventory levels.

Summary

The interplay between automotive cost of sales, inventory levels, and inventory turnover ratios indicates a business adapting through initial disruption in 2020, followed by recovery with increasing costs and inventory builds.

Inventory turnover improvements in the later periods point to enhanced operational efficiency or market conditions favoring quicker inventory movement.

Overall, the trends suggest a company managing cost pressures while improving inventory utilization, reflecting resilience in a fluctuating economic environment.

Automotive Net Sales and Revenue

The automotive net sales and revenue displayed significant volatility throughout the observed quarters. Starting at 29,150 million USD in March 2020, there was a sharp decline to 13,363 million USD in June 2020, likely due to external economic factors. A strong recovery followed, with revenue rising to over 34,000 million USD by the end of 2020. Throughout 2021 and into 2022, the figures fluctuated within the 23,000 to 40,000 million USD range, showing an overall upward trend peaking at approximately 44,735 million USD in September 2024. However, towards the end of the period, revenues saw a decline to 39,861 million USD in March 2025, indicating some volatility towards the latest period.

Accounts and Notes Receivable, Net of Allowance

The net accounts and notes receivable exhibited a general upward trajectory over the timeframe. Starting from approximately 7,536 million USD in the first quarter of 2020, the figure rose to a peak of 14,068 million USD by June 2023. This increase implies an expansion in credit sales or extended payment terms. Despite some fluctuations, the trend remained upward overall, reaching 16,722 million USD by June 2025. The growth in receivables aligns with the increases in revenue but at times shows variance indicating changes in collection efficiency or credit policy adjustments.

Receivables Turnover Ratio

The receivables turnover ratio demonstrates a fluctuating yet somewhat improving pattern. There is missing data in the earlier quarters, but from the available periods starting in March 2021, the ratio oscillated between approximately 9.6 and 15.4 times. A notable dip to around 9.6 times was observed during mid-2022, which corresponds with an increase in receivables, hinting at slower collections during that period. However, the ratio improved to 12.74 times in March 2024, suggesting enhanced efficiency in managing receivables. Towards the end of the observed data, the ratio declined again somewhat, settling at 10.23 times by June 2025, indicating variability in collection performance over time.

Summary of Trends and Insights

Overall, the financial data reveals a pattern of recovery and growth in sales revenue following the sharp downturn in early 2020, coupled with an increase in accounts receivable, which may suggest more aggressive sales or extended credit terms. The receivables turnover ratio, which reflects collection efficiency, shows variability but generally indicates periods of both improvement and decline. The combination of rising receivables with fluctuating turnover suggests that the company may have experienced episodic challenges in collections, potentially impacted by market conditions or strategic credit management decisions. The recent declines in sales revenue towards the final quarters highlight possible emerging pressures or adjustments in the business environment.

The cost of sales for automotive and other segments exhibit significant quarterly fluctuations through the observed period. There was an initial sharp decline in the second quarter of 2020, followed by recovery and rise reaching a peak at the end of 2020. This volatility may reflect the impacts of external factors influencing production and supply chain. From the beginning of 2021 onwards, costs generally increased with some periodic variations, indicating a rising cost environment or higher volume of sales activities. Notably, the cost of sales maintained elevated levels during 2022 and 2023 with occasional dips, but the trend towards the latter quarters into 2024 shows continuation in high cost outlays with minor decreases in specific quarters.

Accounts payable figures, primarily trade payables, display a somewhat upward trajectory throughout the period, indicating increasing levels of short-term liabilities. The amounts rose steadily from 2020 through to late 2021, suggesting either increased purchasing activity or delayed payments to suppliers. In 2022 and into early 2023, the payable balances reached some of the highest points recorded, peaking in mid-2023. However, from mid-2023 onwards, the figures show some fluctuations, including a downtick in certain quarters but remaining generally elevated compared to earlier periods.

The payables turnover ratio, available from the third quarter of 2020, fluctuates within a range that suggests moderate changes in the rate at which the company settles its payables. The ratio shows a general pattern of stability with occasional mild variations, implying consistent payment practices relative to cost of sales. Higher turnover ratios towards the end of 2024 indicate a quicker cycle in paying payables in some quarters, possibly reflecting improved cash management or shifts in credit terms with suppliers.

Cost of Sales Trend

Marked by high variability in 2020 with a notable drop and recovery; consistent rise and elevated levels from 2021 through 2024 with some quarter-over-quarter fluctuations.

Accounts Payable Trend

Progressive increase from 2020 through mid-2023, followed by oscillations but maintaining higher balances relative to the early part of the period.

Payables Turnover Ratio Trend

Relatively stable with minor fluctuations; slight improvement in turnover speed observed towards the end of 2024, indicating changes in payment timing or terms.

Working Capital

The working capital exhibits considerable volatility over the quarters. It starts at 6,407 million USD in March 2020, rises sharply to 9,593 million USD by June 2020, then dips to 8574 million USD in September 2020 before dramatically dropping to 1,014 million USD at the end of 2020. Throughout 2021, it fluctuates between approximately 5,840 and 7,695 million USD, with a general upward trend reaching 14,086 million USD by June 2023. However, there is a notable decline to 7,173 million USD by December 2023, followed by a substantial increase again to 20,473 million USD by June 2025. Overall, working capital shows cyclical increases and decreases but with a long-term rising trajectory toward the later periods.

Automotive Net Sales and Revenue

Automotive net sales and revenue display pronounced seasonality and fluctuation throughout the period. Initial sales start at 29,150 million USD in March 2020 but drop sharply to 13,363 million USD by June 2020, potentially reflecting external market disruptions. Thereafter, revenue generally recovers and increases, peaking at 39,834 million USD by December 2022. Sales figures for 2023 maintain a relatively high level, varying between roughly 36,646 and 41,254 million USD, before showing an upward trend toward 44,869 million USD by June 2025. This suggests robust demand and potentially improved sales execution in the latter periods.

Working Capital Turnover

The working capital turnover ratio, where available, indicates efficiency in using working capital to generate sales. Data begins from December 2020, showing a very high ratio of 107.17, which then rapidly declines to about a range of 8.36 to 21.98 in subsequent quarters. The ratio fluctuates but generally trends downward from above 20 in early 2021 and early 2024 to around 8-10 in mid-2024 through mid-2025. This trend could imply a relative decrease in the efficiency of working capital usage or a strategic shift to holding more working capital relative to sales as sales stabilize at higher levels.

Overall Trends and Insights

The data reveals strong fluctuations aligned with seasonal or external factors, particularly noticeable in the early 2020 quarters—a period marked by extraordinary disruptions. Working capital and revenue both rebound progressively after the initial shocks. However, while revenue growth appears more stable and on a gradual increase, working capital shows greater variability with sharp rises and falls, indicating possible shifts in inventory, payables, or receivables management.

The working capital turnover ratio’s decline suggests that the company may be holding proportionally more capital to support sales, which may reflect strategic inventory builds or credit terms adjustments. The combination of increasing net sales and volatile working capital points to potential operational adaptations to balance liquidity and growth.

Inventory Turnover Ratio

The inventory turnover ratio shows notable fluctuations over the observed periods. Starting at 9.53 in March 2020, the ratio declines to a low of 6.33 by September 2022, indicating a slower rate of inventory conversion into sales during that time. From this low point, there is a clear recovery and upward trend, reaching 10.37 by March 2025. This suggests an improvement in inventory management efficiency, with the company turning over its inventory more rapidly in recent quarters.

Average Inventory Processing Period

The average inventory processing period exhibits an inverse pattern compared to the turnover ratio, as expected. Beginning at 38 days in March 2020, the period lengthens considerably, peaking at 58 days in September 2022. This indicates slower inventory movement and longer holding times during this interval. Since then, a consistent decline is observed, falling to 35 days by March 2025. The decreasing trend in days aligns with the rise in inventory turnover ratio, reinforcing the observation of enhanced inventory processing speed.

Overall Analysis and Insights

The data reveals a period of inventory management challenges around 2021 to 2022, with lower turnover and longer processing times. This might have been driven by supply chain disruptions or changes in demand patterns. However, subsequent periods demonstrate an effective recovery and optimization in inventory handling. The steady increase in turnover ratio coupled with the reduction in processing period towards the latest quarters reflects improved operational efficiency and potentially stronger alignment of inventory levels with sales activity.

Receivables turnover

The receivables turnover ratio shows some volatility over the observed periods. After an initial increase from 13.52 to 15.42 between March and September 2020, it decreased to 14.5 at year-end 2020, followed by a slight rise to 15.36 in the first quarter of 2021. Subsequently, the ratio declined sharply during mid-2022 to approximately 9.6-9.82, signaling a slower collection efficiency during this interval. From late 2022 onward, the ratio demonstrates a gradual recovery trend, reaching values above 12 by the first quarter of 2024. However, this improvement is not sustained consistently, as fluctuations continue, with the ratio slipping below 11 by mid-2025.

Average receivable collection period

The average receivable collection period follows an inverse relationship to the turnover ratio, as expected. Initially, the collection period decreased from 27 days in March 2020 to 24 days in September 2020, indicating improved collection speed. It then slightly increased to around 25 days by the end of 2020. From early to mid-2022, there is a notable increase in the collection period to around 37-38 days, reflecting slower receivables turnover and potential challenges in collecting receivables promptly. Following this peak, the collection period gradually decreases, reaching around 29 days by early 2024, implying an improvement in receivables management. However, toward mid-2025, the number of days extends again, rising to 32-36 days, suggesting some renewed delays in collections.

Overall observations

The data indicates a period of fluctuating efficiency in receivables management over the several years. The mid-2022 period stands out with reduced turnover and higher collection days, potentially signifying operational or market difficulties impacting cash flow. Subsequent quarters show a recovery trend but with intermittent setbacks, which may warrant further investigation to ensure consistent receivables performance. Maintaining a stable and relatively high receivables turnover with a correspondingly low collection period is crucial for optimizing working capital management.

The data reflects quarterly trends in inventory processing period, receivable collection period, and operating cycle over several years. The analysis reveals fluctuations and gradual improvements in these financial efficiency metrics.

Average Inventory Processing Period

This measure shows the number of days inventory remains in the company's possession before being sold. Starting in early 2021 with a period around 38 days, there is an observable upward movement peaking at 58 days in September 2022, indicating slower inventory turnover. Following this peak, the inventory processing period generally declines to 35-37 days by early 2025. This suggests a recent improvement in inventory management efficiency, as inventory is held for fewer days.

Average Receivable Collection Period

The collection period registered modest variability, initially near 24-31 days in early 2021, rising to a high of 38 days during mid to late 2022. After this peak, the period gradually decreases to approximately 27-32 days by the first half of 2025. The trend indicates some volatility in the time taken to collect accounts receivable but an overall recent improvement in collection efficiency.

Operating Cycle

The operating cycle, comprising the sum of the inventory processing and receivable collection periods, reflects the total time between cash outlay and cash recovery. This cycle extends from approximately 65 days in early 2021 to a peak near 96 days in September 2022, followed by a general downward trend reaching around 62-73 days by mid 2025. This shows an initial elongation of the cycle, possibly due to slower inventory turnover and delayed receivables, with recent progress toward a shorter cycle, enhancing cash flow management.

Overall, the patterns indicate that after a period of increasing days in inventory and receivables, the company has made strides in reducing these durations in the most recent quarters. This improvement in operational efficiency could positively impact liquidity and working capital management going forward.

Payables Turnover Ratio

Starting from a recorded value of 4.89 in the first quarter of 2020, the payables turnover ratio exhibits fluctuations over the subsequent periods. There is a noticeable dip to 4.69 in the second quarter of 2020, followed by a gradual increase reaching 5.54 by the end of 2020. The ratio then declines over most of 2021, hitting a low around 4.12 in the third quarter of 2021. From there, a period of relative stability and moderate increases is observed, maintaining values close to 4.5 to 4.6 throughout 2022 and early 2023. Starting in early 2024, the ratio shows a strengthening trend, rising steadily to peak at approximately 5.88 by the first quarter of 2025, before slightly retreating but holding above 5.6 through the middle of 2025. This pattern suggests an overall improvement in the efficiency of payables management towards the later periods after some volatility in the earlier ones.

Average Payables Payment Period (Number of Days)

The average payables payment period inversely mirrors the payables turnover trends, generally shifting between 62 and 89 days. In early 2020, data begins with a payment period around 75 days, increasing slightly to 78 days in the following quarter. The payment period then shortens steadily, reaching a minimum of 66 days at the end of 2020. During 2021, the period lengthens significantly to a high of 89 days mid-year, indicating slower payments. Subsequently, the payment period declines gradually and stabilizes around 79 to 80 days through 2022 and early 2023. From 2024 onwards, the payment period predominantly decreases, falling to a low of approximately 62 days in the first quarter of 2025 and remaining around 65 days mid-2025. The reduction in payment days over the last few quarters aligns with the increase in payables turnover, suggesting a quicker settlement of payables in recent periods.

Overall Observations

The financial data indicates a dynamic but generally improving management of payables. The initial periods exhibit volatility, with fluctuations in turnover and payment period, possibly reflecting adjustments to external factors or internal policies. Later periods demonstrate enhanced efficiency, as indicated by rising payables turnover ratios accompanied by decreasing average payment periods. This trend towards faster payables management could positively impact supplier relationships and cash flow management, although the earlier volatility underscores the need for continued monitoring to sustain the improvements.

The analysis of the financial period data reveals several notable trends related to the company's operational efficiency and liquidity management over the observed quarters.

Average Inventory Processing Period

This metric exhibits some fluctuation but generally remains within a range of approximately 35 to 58 days. There is an observable peak around the mid-2022 period, reaching up to 58 days, followed by a moderate decline to the mid-30s toward the end of the dataset. This suggests periods of slower inventory turnover followed by improvement in inventory management efficiency.

Average Receivable Collection Period

Receivables collection shows variability, with periods where collection days increase notably, such as the second quarter of 2022 reaching 38 days. Following this peak, there is a gradual reduction to the high 20s and low 30s towards the later periods. The company appears to have improved credit and collection policies after mid-2022, resulting in faster cash inflows from customers.

Average Payables Payment Period

Payables days fluctuate significantly, with values generally ranging between 62 and 89 days. The payment period extends dramatically in mid-2022 to near 89 days, indicating an extended timeframe for paying suppliers during this period, which may have been a strategic effort to preserve cash or due to supply chain conditions. Thereafter, the period decreases towards the lower 60s by mid-2025, suggesting a quicker settlement cycle in recent quarters.

Cash Conversion Cycle (CCC)

The cash conversion cycle exhibits wide variation, moving from negative to positive values over different quarters, indicating changes in the company's operational cash flow dynamics. Negative CCC values around early 2020 and 2024 suggest instances where cash inflows from customers come faster than payments to suppliers and inventory turnover. However, there are intervals with positive CCC values (up to 10 days), reflecting periods where the company experiences a slight delay in cash recovery. The overall trend points to an oscillation in working capital efficiency with some improvements toward the end of the observation period but also some recent increases in CCC, which may signal changing liquidity conditions or operational adjustments.

In summary, the company demonstrates a dynamic working capital position, with discernible efforts to optimize inventory turnover and receivables collection post-mid-2022. Payables management shows a deliberate stretching and subsequent tightening of payment periods, likely to balance cash flow requirements. The variation in the cash conversion cycle underscores fluctuating operational efficiency but suggests a focus on maintaining relatively short cycles to support liquidity.