General Motors Company (GM)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	164,037,000	141,330,000	135,754,000	109,126,000	108,813,000
Inventory	US$ in thousands	14,564,000	16,461,000	15,366,000	12,988,000	10,235,000
Inventory turnover		11.26	8.59	8.83	8.40	10.63

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $164,037,000K ÷ $14,564,000K
= 11.26

General Motors Company's inventory turnover has shown a fluctuating trend over the past five years, with values ranging from 8.40 to 11.26. The inventory turnover ratio indicates the number of times the company's inventory is sold and replaced during a specific period, reflecting the efficiency of managing inventory levels.

A higher inventory turnover ratio signifies faster inventory movement and more effective management of inventory levels, which can result in lower carrying costs and reduced risk of obsolescence. In General Motors' case, the inventory turnover has generally been at relatively healthy levels, indicating efficient inventory management practices.

However, the slight fluctuations in the inventory turnover ratio suggest that General Motors may have experienced variations in sales volume, production, or inventory control over the years. It is essential for the company to closely monitor its inventory turnover and make adjustments to optimize inventory levels and meet customer demand effectively.

Overall, General Motors' inventory turnover ratio provides insights into the company's operational efficiency in managing inventory and highlights the importance of maintaining a balance between carrying enough inventory to meet demand while avoiding excessive stockpiling that could lead to increased holding costs.