General Motors‘ new labour deals, agreed with United Auto Workers union members only after a lengthy US strike, will cost the automaker US$9.3bn even as it outlined $10bn in share buybacks, a 33% dividend increase and “substantially lower” spending at its robotaxi unit Cruise, Reuters reported.

The report said the buyback was the equivalent (at last Tuesday’s 28 November closing price) to nearly a quarter of GM’s common stock. The shares had been down about 14% this year before rising 9.8% to $31.71 on Wednesday. The stock was still below the $33.66 price it closed at just ahead of the UAW strike start on 15 September.

Shares in Ford and Chrysler parent Stellantis, which also were hit by the UAW strike, were up 4.3% and 4.8%, respectively, Reuters added, noting GM lowered 2023 profit expectations after the strike.

The stock price has struggled as GM dealt with the strike and the problems at Cruise, the news agency noted.

“Finally some good news for GM and this was strong outlook and comments from [CEO Mary] Barra & Co [after] the UAW debacle,” Wedbush Securities analyst Daniel Ives told Reuters in an email. “Now it’s about getting the train back on the tracks and this a great start.”

Reuters said the $9.3bn in additional costs to the end of 2028 was for agreements with the UAW and Canadian union Unifor, and works out at about $575 per vehicle over the deals’ life.

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The report said GM’s new guidance reduced expected net income for 2023 to a range of $9.1bn-$9.7bn, compared to the previous outlook of $9.3b-$10.7bn.

That accounts for an estimated $1.1bn EBIT-adjusted impact from the UAW strike, which lasted just over six weeks, primarily from lost production. The total impact in 2023 is $1.3bn including the higher wages and benefits in the deal, Reuters reported.

“Now that we have a ratified contract and a clear path forward that includes greater operating investment efficiencies, we can resume returning capital to shareholders per our plan,” Reuters quoted GM CEO Mary Barra as saying on an investor conference call during which officials set out the automaker’s latest targets.

Barra reportedly also acknowledged the stock price was “disappointing to everyone,” pointing out the shares at around $28 were 15% below GM’s 2010 initial public offering price.

Reuters noted GM had said earlier this year it would cut fixed costs by $2bn by the end of 2024 and followed up last July with plans for another $1bn in cost reductions. In April, GM had said about 5,000 salaried workers had taken buyouts.

GM reportedly said it would cut costs at Cruise, which has suspended all US testing after a crash in California last month prompted state regulators to bar the company from testing driverless vehicles. Cruise lost over $700m in the third quarter and more than $8bn since 2016.

“We expect the pace of Cruise’s expansion to be more deliberate when operations resume, resulting in substantially lower spending in 2024 than in 2023,” Barra told Reuters. GM chief financial officer Paul Jacobson said spending on Cruise in 2024 would be down “hundreds of millions of dollars.”

Barra reportedly said she was “disappointed” with EV production this year due to difficulties with battery module assembly, but GM expected “significantly higher” production and “significantly improved” profit margins in that business in 2024. CFO Paul Jacobson said GM was aiming for single digit pre tax margins on EVs by 2025, including Inflation Reduction Act benefits.

However, Reuters added, GM had also said the new labour deals would add $3 per kilowatt hour to battery cell costs.