GM might have* that is( mortgaged its future last week.

On Wednesday, the automaker announced that it would boost its dividend and buy back $10 billion worth of its shares, effectively erasing this year’s income that is net then some. The move happy shareholders, with GM’s trading and investing about 10percent greater than ahead of the engineering that is financial were announced.

But Shareholders’ delight might be momentary. Earnings from product sales of fossil gas cars are meant to bankroll the change to electric automobiles, GM president Mark Reuss stated year that is last. That doesn’t appear to be the case anymore, in part because the company is desperate to prop its share price up, which can be exactly like it had been 5 years ago.

CEO Mary Barra probably believes industry has been unjust considering that the business features, except for a quarters that are few been profitable for more than a decade. The share buybacks are undoubtedly a ploy to wrench GM out of its rut.

Any boost the buybacks give to the share price will only paper over the reason that is likely tend to be warm on GM: the business does not have the capability to perform on its programs.