GM Shares Soar on Raised Profit Outlook

General Motors shares have soared after the company announced it would be more profitable and return more money to shareholders.

Shares in America’s biggest automaker rose more than 2% after it raised its 2016 earnings forecast by 25 cents to between $5.25 and $5.75 per share.

GM also plans to raise its stock buyback program by 80% to $9 billion and extend it to the end of 2017.

In total it plans to give $16 billion back to shareholders by the end of 2017.

GM executive Mary Barra said: “We made significant progress executing our strategic plan and the results are being demonstrated through our improved earnings.”

Shares in rival automaker Ford fell more than 3.5% after it said US margins could hit a plateau of 9.5%.

Ford said on January 12 it would give a special $1 billion dividend, and that it expects pre-tax profit of between $10 billion and $11 billion in 2015.

However, this figure was at the lower end of analyst expectations.