*

GM raises adjusted pre-tax profit projection for the year

to $13

billion to $15 billion from previous range of $12.5 billion to

$14.5 billion

*

GM shifts focus to next-generation Chevrolet Bolt for

Cruise

self-driving unit

*

GM's China operations face scrutiny, $104 million loss

reported

(Adds stock movement analysis and production changes in

paragraphs 2, 3, 4, 17)

By Nora Eckert

DETROIT, July 23 (Reuters) - General Motors ( GM )

reported second-quarter profit and revenue on Tuesday that beat

Wall Street's expectations, and raised its annual profit

forecast for a second time this year, buoyed by strong pricing

and demand for gas-powered trucks.

The company's shares plunged more than 6%, however.

The selloff could be related to a number of factors,

analysts said, including a shift in the company's Cruise

self-driving vehicle strategy, its continued losses in China and

a broader concern that the auto industry will become less

disciplined on inventory levels and buyer incentives.

"We believe this is just a knee-jerk reaction and the GM

quarter was a robust one which should drive the stock higher

over the coming weeks and months," said Dan Ives, analyst at

Wedbush Securities.

The Michigan automaker is leaning heavily on its

gasoline-engine offerings to fuel its profits through a

slower-than-anticipated transition to electric vehicles.

GM executives say the company has laid the foundation

necessary to meet ambitious ramp-up targets on EVs.

"We're encouraged by the early results we're seeing in EVs

now that we can build at scale," CFO Paul Jacobson said in a

call with reporters.

A report from the Federal Reserve last week showed

motor-vehicle production surged to a nine-year high in June.

GM increased its adjusted pre-tax profit projection for the

year to $13 billion to $15 billion, from its previous range of

$12.5 billion to $14.5 billion.

The company reported adjusted earnings per share of $3.06

that beat Wall Street's average estimate of $2.75, according to

LSEG data. The carmaker reported $48 billion in revenue for the

three-month period, surpassing analysts' consensus of $45.5

billion in the June quarter.

Executives at GM also provided an update on its Cruise

self-driving unit, saying it will focus its development efforts

on a next-generation Chevrolet Bolt rather than its planned

futuristic Origin vehicle that would not have a steering wheel

or other human controls.

GM's stock has outperformed its rivals and the S&P 500 in

2024. The company's share price has increased 38% this year as

of Monday, while cross-town rival Ford Motor ( F ) has notched

an 18% increase, and Jeep-maker Stellantis ( STLA ) lost 11%.

EV INVESTMENTS AND RETREAT

GM received another cash boost from the U.S. government this

summer to support its EV ambitions, although it has walked back

many of its targets during the last year.

The Biden administration said this month that it would award GM

$500 million to convert one of its Michigan gas-engine

vehicle-assembly plants to produce EVs.

GM last week declined to reiterate a target of achieving 1

million units of EV production capacity in North America by the

end of 2025. The carmaker also recently lowered its projected EV

output for the year, now projecting the higher end of its 2024

production to be 250,000 units, down from a prior forecast of

300,000 units.

CEO Mary Barra told investors that GM would delay the

opening of its Orion Assembly EV truck plant by six months,

until mid-2026.

Still, GM executives said the company is scaling up

production of the Chevrolet Equinox EV and plans to launch

several new battery-powered models over the coming months.

"GM seems to be showing that even at lower production

they'll be able to rationally roll out EVs and not overspend on

that," said Tim Piechowski, portfolio manager with ACR Alpine

Capital Research in St. Louis, which owns GM shares.

GM reported a 14% increase in net income over the year-ago

period to $2.9 billion.

Although the Detroit automaker has kept its sights set on

transitioning its lineup to EVs, Barra has said it plans to

introduce plug-in hybrids in 2027. Ford is currently benefiting

from significant increases in hybrid sales.

Ford is set to release its second-quarter results

Wednesday.

The outcome of the U.S. presidential election in November

will also likely affect GM's plans for battery-powered vehicles.

Former President Donald Trump has criticized President Joe

Biden's approach on EVs, which have included significant

government subsidies.

GM is also facing increasing investor scrutiny on its

operations in China, which in the past decade have shifted from

being a profit engine to a drain on the company's finances.

The company recorded a $104-million quarterly loss in China,

a disappointment after executives said they expected to be

profitable in the region for the second quarter.

"It's a difficult market right now. And frankly, it's

unsustainable, because the amount of companies losing money

there cannot continue indefinitely," Barra said.

Jacobson said GM would work with its joint-venture partner

in China to restructure its business and plans to cut spending

there.

"It's clear that the steps that we have taken, while

significant, have not been enough," Jacobson said.

Last month, a leading automotive analyst called on the Detroit

Three to withdraw from China to save cash to spend on costly EV

production.