Despite the shock of the semiconductor crisis in the fourth quarter, General Motors on Tuesday forecast a very profitable 2022 based on strong consumer demand in the face of rising inflation.

Profits fell in the final quarter of 2021 as GM saw global car sales plummet. But the big U.S. automaker still managed to make a record $10 billion in annual profits as tight retailer inventories drove up prices.

GM said it expects comparable profits in 2022 despite cost pressures for raw materials, freight services and labor.

Executives cited strong consumer demand for new vehicles, with pent-up demand for “several million” vehicles driving the market, according to chief executive Mary Barra.

“We expect to see high prices and that will continue into 2022,” she said on a conference call with reporters.

“We continue to have low inventories, so those fundamentals are even more important than headline inflation from a vehicle price perspective,” Barra said.

Barra also characterized the semiconductor supply outlook as gradually improving, though she added the caveat that additional Covid-19 outbreaks or other disruption also loom as a possibility.

“That’s our best estimate,” Barra said on a conference call with analysts. “That’s what we think we can do.”

In light of this improvement in semiconductors, GM forecasts a 25-30% increase in automotive production in 2022.

– Higher costs –

The major US automaker posted a profit of $1.7 billion for the quarter ending December 31, down 38.7% from the last three months of 2020, as revenue fell 10.5% at $33.6 billion.

But for the full year, GM reported $10 billion in profit, up 55.9% from 2020 levels.

Faced with chip shortages, GM focused production on its most profitable vehicles, such as full-size trucks and sport utility vehicles.

GM forecast 2022 profits of between $9.4 billion and $10.8 billion.

This outlook is despite a $2.5 billion increase in commodity and logistics costs in 2022.

Chief Financial Officer Paul Jacobson said GM’s earnings guidance range reflects possible fluctuations due to changes in interest rates or commodity costs.

But Jacobson described the current momentum as a “very, very strong business environment.”

– ‘Hello car’ –

Barra also cited recent advances in GM’s autonomous technology and its boost in electric vehicle capability following a series of major product launches and factory announcements.

On Tuesday, GM’s autonomous Cruise business opened a “sign-up page” allowing consumers to take a ride without a driver.

A video on Cruise’s website showed several cyclists in San Francisco staring at the technology as they rode in a vehicle. One of the clips showed a couple waving at the self-driving vehicle as it entered.

“Hello car,” the man said.

“That feels weird,” said another.

Barra was expansive, likening her experience to “riding with an experienced driver who pays attention all the time.”

But following those multi-billion dollar investments, GM chose not to reinstate the investor dividend, she said.

The shares rose 1.1% to $54.68 after hours trading.