General Motors (NYSE:GM) has extended $3.6 billion under its three-year revolving credit agreement to April 2022, to further strengthen its liquidity position. This complements the extension of the $2-billion 364-day revolving credit agreement to April 2021 that GM and GM Financial renewed earlier this month.
In addition, the car maker has suspended the quarterly cash dividend on its common stock, suspended its share repurchase program and has taken other significant austerity measures to preserve near-term available cash.
"We continue to enhance our liquidity to help navigate the uncertainties in the global market created by this pandemic," said GM Chief Financial Officer Dhivya Suryadevara. "Fortifying our cash position and strengthening our balance sheet will position the company to create value for all our stakeholders through this cycle."
GM remains committed to its capital allocation framework, which is focused on reinvesting in the business at pretax returns equal to or greater than 20%; maintaining a strong investment-grade balance sheet; and returning capital to shareholders after the first two objectives have been met.
Meantime, a story last week in the Detroit Free Press revealed that GM plans to start calling in some workers to its U.S. factories this week to help prepare the sites for vehicle production again.
GM is working with the UAW and government officials on safety protocols to lower the risk of exposure to the highly-contagious COVID-19.
GM’s U.S. plants have been shuttered since mid-March due to COVID-19.
Shares faded 58 cents, or 2.6%, to $21.37.
