January 12, 2017: General Motors Co. (NYSE: GM) said it expects its 2017 earnings per share (EPS) diluted-adjusted to increase to $6.00-$6.50, up from its 2016 calendar-year outlook of $5.50-$6.00. In 2017, the company also expects to maintain or improve EBIT-adjusted and EBIT-adjusted margin on higher revenues, compared to 2016, and generate about $6 billion of automotive-adjusted free cash flow.

Based on this strong outlook, the GM Board of Directors approved an additional $5 billion in common stock repurchases under its existing share repurchase program, which was announced on March 9, 2015. The new authorisation, which has no expiration date, brings the total under the program to $14 billion.

Share buybacks for the program’s initial authorisation of $5 billion were completed in the third quarter of 2016, one quarter earlier than planned. In the fourth quarter of 2016, the company also completed $1 billion of the next $4 billion authorisation declared in January 2016. The company expects to meet its prior commitment to repurchase $9 billion of common stock by the end of 2017.

GM also announced a $1 billion increase to its cost efficiency target, raising it to $6.5 billion through 2018, of which about $4 billion has already been achieved through 2016. The increased estimate is based on expected additional savings in material, logistics, manufacturing and general administrative costs.

Chairman and CEO Mary Barra, President Dan Ammann and Executive Vice President and CFO Chuck Stevens shared this outlook with the investors and analysts attending the Deutsche Bank 2017 Global Auto Industry Conference in Detroit.

“We’ve generated consistently strong results the last few years by delivering great vehicles, growing the topline and driving efficiencies while at the same time establishing a leading position in shaping the future of transportation,” Barra said. “We’ll stay focused on executing our strategic plan and generating the profitable growth needed to create long-term value for our shareholders.”

GM’s 2017 outlook is based on expected strong performance in North America and China, growth of GM Financial, continued cost efficiencies, improvement in South America and an ongoing strong vehicle launch cadence.

Specifically, the company anticipates the proportion of its global volume from new or refreshed vehicles – those in production less than 18 months – to grow to 38 percent in the 2017-2020 timeframe, up from 26 percent during the 2011-2016 period. Crossovers, trucks and SUVs as a proportion of GM’s global volume of new or refreshed vehicles in the 2017-2020 period are expected to increase significantly, to 52 percent – up from 38 percent the prior six years.

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Research firm AutoData said that US sales hit an all-time high of 17.55 million vehicles in 2016. The firm also said that December sales came in much stronger than expected, at a pace of 18.4 million vehicles. That figure is well above estimates for about 17.7 million.

Shares of General Motors Co (GM.N) rose 5.5 percent and Ford Motor Co (F.N) stock rose 4.6 percent, far outpacing the wider Dow Jones Industrial Average, which was up only 0.3 percent.

For 2016 sales, Ford reported its best year in a decade while Nissan and Honda said they sold a record number of cars in the US. Toyota and GM bucked the trend, with their total sales in 2016 down from the year earlier.

Light trucks and sport utility vehicles were up 8.3 percent compared to the year-ago period while passenger cars were down 4.7 percent.

The positive increase in auto sales is mainly attributed to strong consumer confidence coupled with low fuel prices. In December, US consumer confidence reached levels not seen in 15 years. Auto sales are an early indicator of consumer spending.

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August 4, 2016: With the passage of the Goods and Services Tax (GST) Constitutional Amendment of Bill in the Upper House of Parliament on August 4, a decade-long wait finally came to an end. Many term it as the next big reform in India after liberalisation in 1991. The GST will unify all indirect taxes and has the potential to transform India into ‘a single common market’, promising huge efficiency gains.

Though there might be a slight increase in inflation levels in the short term, the reform, if implemented prudently, will be positive for investment. “The GST could add 80bp to GDP growth. There will be growth in investments, revenue as the tax net will be widened, foreign inflows as there will be general positive sentiment around business environment and jobs,” says Pranjul Bhandari, chief India economist, HSBC.

R Chandrashekhar, President, NASSCOM, stated: “The passage of the Bill will unarguably usher in the most impactful tax reform this country has seen. The services industry at large was administered under a single authority in the Centre under the service tax regime. The simplicity and certainty that it offered needs to be emulated in the GST law that States and Centre adopt subsequently. The new tax regime should also be future ready and cater to the needs of the emerging digital economy in the country.” Nasscom is the trade association of Indian information technology and business process outsourcing industries.

At present, the effective indirect tax rates on goods and services are 22.5% and 15%,respectively. If the standard GST rate is kept at the 17-18% mark, service producers would face an increased tax burden while manufacturers would see a fall. “The short-term impact on growth, in our view, will depend on the pass-through of tax incidence to final prices and the effective tax rate after accounting for exemptions and input tax credit,” says Dhiraj Nim, an economics associate.

“We have looked at a number of scenarios for pass-through. The most positive scenario could be one where manufacturers pass through tax cuts to output prices while service providers do not pass through the tax increases. However, the opposite scenario where manufacturers do not pass through benefits but service providers pass on costs would lower consumption and overall growth,” says Bhandari.

As far as impact on fiscal deficit is concerned, it is uncertain in the short term but will be a revenue generator in the long run. Although states could have potentially lost out on revenue following GST, as a part of the negotiation process, the Centre has promised full compensation for five years. Over time, however, GST is expected to raise tax buoyancy by widening the tax net, benefiting both the Centre and the states.

However, several hurdles still remain, such as setting of the GST rate, thresholds and exemptions. The draft model law, currently in public domain, requires close collaboration between industry and government to ensure that the GST regime lives up to expectations, including not only maintaining but enhancing the competitiveness of products, services and the internet sector.

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June 3, 2016: Japan’s SoftBank announced that it will sell at least $7.9 billion in shares of China-based ecommerce giant Alibaba to raise capital. Softbank is Alibaba’s largest shareholder. It owns about 32 percent of the shares. The transactions will bring the figure down to 28 percent. The deal is said to boost liquidity and improve leverage ratio of SoftBank.

The largest chunk will come with the issuance of $5 billion in mandatory exchangeable trust securities convertible into Alibaba shares in three years. SoftBank also plans to sell $2 billion in shares to Alibaba, $400 million to the Alibaba Partnership and $500 million to an unnamed sovereign wealth fund.

The move comes amidst the Japanese telecom company’s efforts to cut costs and focus on turning around Sprint, the American cellphone service provider that it controls. Under president Nikesh Arora, SoftBank aims to cut its debt. The company reported holding about just under $77 billion worth of long-term debt as of March 31, 2016, according to Standard & Poor’s Capital IQ, a research service.

SoftBank invested when Alibaba was just a year old. Not surprisingly, Alibaba is one of the most valuable assets in SoftBank’s portfolio.

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