*

GM to deliver message focused on stability over aggressive

growth

*

Investors concerned about EV losses and competition from

China

*

Barra: operations in China are "unsustainable" without a

restructuring

*

GM to highlight combustion-engine vehicle profits and new

SUV

launches

*

Shareholders eager to hear how GM intends to bring down EV

costs

By Nora Eckert, Ben Klayman

DETROIT, Oct 2 (Reuters) - General Motors ( GM ) will

assure investors next Tuesday that there is no need to panic

about decelerating demand for electric vehicles and the U.S.

automaker could even improve its profits in 2025, according to

two people familiar with the plans.

The message at the company's investor day is a dramatic contrast

from the one GM CEO Mary Barra laid out at the same event in

2021, when she highlighted ambitious goals that included

doubling revenue to about $280 billion by 2030, fueled in part

by its autonomous unit Cruise and expected EV sales growth.

Investors are worried about automakers' profits as they face

significant losses on EVs, worries about plateauing sales of

gas-engine vehicles and intensifying pressure from Chinese

automakers like BYD.

The slower-than-anticipated EV transition has caused many

automakers to adjust plans, and GM's messaging on Tuesday is

expected to focus less on aggressive growth and more on

stability.

"I'm not going to disclose what we're going to say at

investor day, but if you looked at it, it's a very strong

quarter 3," Rory Harvey, GM's president of global markets, said

of third-quarter sales. "From that point of view, you'd have to

say that that is a positive platform leading into investor day."

However, executives speaking at the Detroit automaker's

operations in Spring Hill, Tennessee, will emphasize that profit

margins have not topped out with internal-combustion engine

(ICE) vehicles and EV profits are closer than investors think,

said the two people, who asked not to be identified.

GM will paint a rosy picture for its ICE models, touting the

launch of eight refreshed SUV models - including the Chevrolet

Equinox, Buick Enclave and Cadillac Escalade - between now and

the end of 2025 as a reason those profit margins can still

improve, the sources said.

GM will not boost its stock buyback or dividend during the

meeting, but it will reduce its cash on hand target - now at $18

billion to $20 billion - by $2 billion, one of the sources said.

The move is meant to signal that the company will look to build

upon its $6 billion stock buyback program.

QUEASY INVESTORS

Shareholders have grown queasier about the broader auto market

in the U.S. too, resulting in GM's stock plummeting even after

posting upbeat earnings results in recent quarters, and raising

guidance.

They want assurances that EV investments will not become a

bottomless pit of losses.

"Shareholders in general want the company to be restrained

with how much capital intensity and [research and development]

intensity they're willing to put into some of these technologies

that don't have a proven business model yet," said Tim

Piechowski, portfolio manager at ACR Alpine Capital Research, a

GM investor.

Morgan Stanley analyst Adam Jonas recently downgraded GM and

cross-town rival Ford's stock, citing climbing U.S.

inventories, stretched affordability and the competitive threat

from China.

For GM, China and Cruise - formerly strengths - have now

become pain points that investors want a clearer direction on.

Cruise last year was embroiled in controversy after a pedestrian

in San Francisco was dragged by one of its robotaxis. Since that

October accident, GM halted use of its autonomous vehicles and

has slowly begun resuming operations with a small fleet of

human-driven vehicles in some parts of the U.S.

Barra has said operations in China, which used to be a profit

engine for the company, are "unsustainable" without a

restructuring. GM recorded a $104 billion loss in the region

during the second quarter.

Shareholders are also eager to hear more on how GM intends

to bring down costs on its EVs as it races against EV giant

Tesla and Chinese rivals.

Last month, GM and Hyundai signaled a potential

collaboration, signing a non-binding memorandum of understanding

to consider ways to "leverage their complementary scale and

strengths to reduce costs and bring a wider range of vehicles

and technologies to customers faster."

GM's Ultium Cells battery technology will be front and

center for the investor event, which will include tours of the

Tennessee plant's battery and EV assembly operations.